There is salvation to avoid a negative economic impact after the end of the PUA

The arrival of federal funds to alleviate the burden on the unemployed due to the COVID-19 pandemic prevented the economic collapse of the island and yielded its effect of achieving stabilization during the last year and a half, demarcated the Secretary of Labor, Carlos Rivera Santiago.

Now that the aid ends on September 4, will the economy go bankrupt?

“This is the concern, how are we going to keep the economy afloat?” The official agreed in an interview with First Hour.

The greatest impact of economic aid for unemployment was on an increase in the acquisition of goods and services by part of the beneficiary population. The sale of boats, carts and bicycles, the construction of swimming pools and even aesthetic tweaks, such as enlarging the bust, increased significantly during the pandemic.

For this reason, the economist Joaquín Villamil, of the firm Technical Studies, has detailed that the greater impact of the purpose of the Program of Unemployment Pandemic (PUA, in English) and of the contribution of $ 300 to the regular unemployment, will result in “that the level of consumption will drop significantly and this is the most important consequence.”

He estimated that the preliminary impact is around a 3% drop in consumption.

Villamil commented that he hopes that now that the start of the works with the federal funds that have arrived for the reconstruction after the impact of Hurricane Maria is predicted, this consumption will resurface. .

“I think at least what is going to have a big impact in the next two years is the CDBG-DR (Community Development Grant Block Program for Disaster Recovery) and CDBG mitigation funds. There will be a lot of money that went into the economy and that is going to make up for the fall in the completion of the PUA, mitigating the impact of the end of the PUA, ”he argued.

They rely on staff recruitment

For his part, the Secretary of Economic Development, Manuel Cidre, said he was convinced that the return of the unemployed to the workforce would prevent an economic collapse in the face of the end of federal unemployment benefits that occurred during the pandemic. .

“What do I see in the short term? I see a reinventing industry, accelerating automation processes, an increase in self-employed and job applications relevant to all this change that will happen. It is on our side to replace this money, which you would be surprised at the size of this money, about $ 10 billion we have distributed in funds. So we need to look at how we replaced this impact on the economy, “he told Primera Hora.

He said job vacancies are available to succeed in replacing the economic impact. As an example, he commented at present that the company Medtronic is looking for 280 workers and the company International Restaurant Services, owners of Chili’s, Roman s Macaroni Grill and PF Chang ‘s, has 800 places available.

“Puerto Rico, today more than ever, must be inserted in a dynamic of productivity, first, before the arrival of federal funds (for reconstruction after the passage of Hurricane Maria) and, second, that a country which is not productive does not go ahead. So, again, there is no one or anything to replace employment above any other consideration, ”Cider said.