Discussion Paper

Puerto Rico's Shrinking Labor Force Participation

Abstract: A key concern about Puerto Rico?s prospects is that its labor force participation rate, which is the percentage of the adult population either working or looking for work, has fallen sharply. Looking at the data shows that this decline cannot be attributed to any particular demographic segment. Instead, it is the consequence of an aging population, accelerated by a falling birth rate and outmigration of a relatively young cohort. Expected demographic trends will continue to put downward pressure on the participation rate over the medium term, creating a challenging headwind for the economy to overcome.

Keywords: Labor Supply; Puerto Rico; Labor Force; Participation Rate;

JEL Classification: J00; R1;

Bibliographic Information

Provider: Federal Reserve Bank of New York

Part of Series: Liberty Street Economics

Publication Date: 2016-08-10

Number: 20160810