Puerto Rico Compass ©

Q2 2014: PR’s Demographic Crisis

Impact of population shrinkage on economic indices

Compared with other states in the US mainland, Puerto Rico ranks 38th in terms of GDP. This economy is facing yet another crisis, a demographic time bomb. In 2013 official statistics indicated that the population declined by a record 40,000 people—roughly the population of the Municipality of Vega Alta. PR’s population started falling in fiscal 2005 and is now ageing even faster. More than 17% of Puerto Ricans are already 65 or older. According to projections by the PR Planning Board, the number of PR residents will fall from 3.6m to about 3.3m by 2020. Besides an ageing population, the major cause for population shrinkage is migration. About 97% of PR emigrants go to the US. This demographic outlook presents great challenges for various economic sectors, such as, labor, real estate, retail, banking, pension retirement systems, tax revenues, and the whole economy. Find out how a declining population in Puerto Rico impacts the island’s key economic indicators.

Puerto Rico Economic Pulse ©

June 2014: On Why Millennials Matter

Generation Y plays a key role in the workforce

There is a generation gap in the workforce. Baby boomers, born between 1946 to mid 1960s, resent Generation Y or the Millennials, born since the early 1980s to late 1990s. And Generation X, those born between mid 1960s to early 1980s, is fed up being “stuck in the middle between older workers who refuse to retire and younger ones who are treated far better than they ever were.” Puerto Rico needs to manage these three age groups with such differing attitudes. There is a widespread consensus among educators, marketers, and policymakers that digital technologies have given rise to a new generation of students, consumers, and citizens who see the world in a different way. Growing up with the Internet transformed their approach to work. Puerto Rico’s difficult economic and fiscal situation needs to regain competitive advantage in what it can produce and sell. Innovation plays center stage in this transformation. Can Millennials help?