No More 10 Minute Breaks: What Puerto Rico’s Job Market Looks Like a Year After Hurricane Maria

Puerto Rico lost 35,000 jobs in the month after Hurricane Maria struck. One year later, employment in the storm-battered island still hasn’t recovered.

Maria—the worst storm to hit Puerto Rico in nearly a century—knocked out electricity across the island and ravaged roads and infrastructure. Thousands of small businesses closed, a huge blow to the island’s already suffering economy.

“Most of the jobs are generated by small businesses, and small businesses were hit the hardest by the hurricane,” said Edwin Meléndez, director of the Center for Puerto Rican Studies at Hunter College, City University of New York.

Employment in the U.S. territory had been on a steady descent since 2006. The storm brought on a far starker fall.

In September 2017, when Hurricane Maria made landfall, there were 871,000 jobs. While Puerto Rico was able to recover some of the lost jobs in subsequent months, payrolls clocked in at 855,000 last month, well below prehurricane figures, Labor Department data show.

Though hurricanes don’t permanently dent national economic data, such as gross domestic product and jobs numbers, they can leave lasting scars on local economies.

Hurricane Katrina, which roared across New Orleans in 2005, devastated its economy. Employment in New Orleans still hasn’t returned to pre-Katrina levels.

In Puerto Rico, a mass population exodus with roots in the island’s economic crisis that began more than a decade ago brings into question just how much the job market can regain steam. Research by Jennifer Hinojosa, Nashia Roman and Mr. Meléndez estimates that in the year after Maria struck Puerto Rico, nearly 160,000 island residents relocated to the U.S. mainland. This compares with an estimated 145,000 for the previous two years combined.

Mass migration to the U.S. means there are fewer Puerto Ricans available to look for work on the island. This has helped drag down the unemployment rate in Puerto Rico to 8.4% in September from 10.6% a year earlier. This jobless rate is still well above the U.S. rate of 3.7%.

Some sectors in the island appear to be recovering jobs. Mr. Meléndez points to industries such as pharmaceuticals, in which many companies were running at capacity once energy in Puerto Rico was restored.

Vicente Feliciano, president at Advantage Business Consulting, an economic consulting firm in Puerto Rico, said with disaster-related funding working its way through the economy, jobs have started to come back. The hotel industry, in particular, has reemerged as a bright spot.

“What we see is somewhat of a recovery,” Mr. Feliciano said. But, he added, “certainly not back to the level it was.”

Puerto Rico Governor Raises Hurricane Maria Death Toll to Nearly 3,000 (Aug. 28)

Puerto Rico’s Power Restoration Slowed by Miles of Downed Lines (Oct. 6, 2017)

from Real Time Economics https://ift.tt/2R8UTwh