Bonds

Puerto Rico enjoys much stronger employment trends than U.S. Virgin Islands

Since the start of the COVID-19 pandemic Puerto Rico’s employment picture has improved much more than that of the U.S. Virgin Islands, according to a Federal Reserve Bank of New York official.

From February 2020 to September of this year, Puerto Rico’s employment has increased by a “very strong” 6%, said Jaison Abel, head of urban and regional studies at the bank. United States employment broke even in September compared to employment in February 2020.

On the other hand, the U.S. Virgin Islands employment is down 15% from the pre-pandemic level, which Abel said was “really, a massive gap.”

Hotels in San Juan. Puerto Rico’s tourist facilities have recovered well from the COVID-19 downturn.

Bloomberg News

Jason Bram, economic research advisor at the bank, said Virgin Islands construction employment had been unusually robust prior to the pandemic due to rebuilding from 2017 Hurricanes Irma and Maria. This employment plunged back to more typical levels during the pandemic.

Since the pandemic, construction employment has been increasing in Puerto Rico while in the Virgin Islands it has been decreasing, Bram said Monday. 

The Virgin Islands economy has been very dependent on visitors from cruise ships, which were suspended for more than a year after the onset of the pandemic, Bram said. The cruise ship visitation was at about 14% of normal in 2021, 28% this year, and is expected to be at 60% next year, according to the travelpulse.com web site.

Tourism has rebounded from the pandemic better in Puerto Rico than in the U.S. Virgin Islands, partly because less of it comes by cruise ships in Puerto Rico, Bram said Monday.

Employment at the St. Croix oil refinery has been limited, Bram said. For many decades the refinery was the Virgin Islands’ biggest private sector employment.

As for Puerto Rico, three factors have helped the island recover from what was a 2006-2017 recession, Bram said. The work of the Oversight Board and the restructuring of government debt has led to clarity on fiscal issues.

In Puerto Rico the rebuilding from the hurricanes has helped it recover from the pandemic, Bram said. The island is also benefiting from federal disaster aid and strength in the pharmaceuticals and medical supplies industry.

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