The Puerto Rico Department of Labor and Human Resources (PRDLHR) published last Friday the results of the monthly Labor Force Survey. Unfortunately, while the agency’s publication included various estimates and analysis, most public discussion has focused only on one element of the publication — the reported unemployment rate of 7.3% for July 2020. Focusing solely on that number understates the real extent of economic hardship caused as a result of the pandemic and is insufficient to ascertain the true effect on the Puerto Rico economy.
Which unemployment rate to focus on matters a lot when we are trying to understand the economy now and the implications of various policy choices going forward. For example, understanding the nature and characteristics of those seeking unemployment insurance support should tell us something about what types of workforce development programs we should be developing to give people the skills they need to rejoin the workforce. Understanding the types of employers who were forced to furlough or even downsize their work staff should tell us something about how to craft the small business support programs funded by the CARES Act funding the Government has received. With these objectives in mind, the Oversight Board will continue to analyze in detail the labor market during the pandemic, and calls on all public, private, and academic stakeholders to similarly engage with the available data. The people of Puerto Rico deserve a policy agenda built upon deep analysis to ensure all have an opportunity to recover from the impact the pandemic has had on our lives.
Click below to read the full op-ed by Ricardo Fuentes, the Oversight Board's Economist as published in Caribbean Business.