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Manufacturing Industry Hopeful Of Economic Recovery In FY 2004
Gross National Product Still Growing At Less Than 2%
By MARIALBA MARTINEZ
September 11, 2003
Two years after 9/11, the economic state of Puerto Ricos manufacturing industry remains pretty much unchanged, with everyone waiting for a recovery which experts now say will take place in fiscal year (FY) 2004.
"For the 2003 fiscal period [ended June 30], it seems likely that the growth rate of real gross national product fell short of the 2% mark; it was likely around 1.5%," said the Puerto Rico Manufacturers Association (PRMA) in its "Econews" analysis, prepared by local consulting firm Estudios Tecnicos. "With the expected sharp increase in government construction, growth is seen to accelerate to about 3.2% in fiscal year 2004 and may be as high as 3.5%. As the U.S. recovery picks up steam, the local manufacturing industry should strengthen, contributing to overall economic growth."
Economic Development & Commerce Secretary Milton Segarra is confident about the islands economy. "Employment in manufacturing gave the first signs of increase, with 4.2% growth, during July 2003 after showing a reduction of 12.7% and 1.9% during FY 2002 and FY 2003," he said. "Its important to emphasize that the construction industry as well as the manufacturing industry had been showing a tendency to decrease before the terrorists attacks, and that [the attacks] only accentuated the intensity of the economic difficulties.
"Nevertheless, at the start of FY 2004, we can see an improvement in manufacturing jobs," added Segarra. "Average manufacturing wages have increased 1.4%."
The Puerto Rico Industrial Development Co. (Pridco) recently announced the job statistics for FY 2003. They show a 3% decrease in the number of companies opening, from 73 in FY 2002 to 71 in FY 2003. The number of jobs created rose by 68%, from 1,188 new jobs in FY 2002 to 1,997 in FY 2003.
Company closings fell by almost half, from 77 in FY 2002 to 38 during FY 2003. Puerto Rico lost 2,988 jobs during FY 2003, compared with 5,542 jobs lost during FY 2002, a 46% decline. Most of the job losses and new-job creation occurred in the same manufacturing sectors, namely apparel & textiles, electric & electronics, and chemicals.
Before leaving as Pridco executive director in June, Hector Jimenez Juarbe had identified 128 projects with the potential to generate a total of 9,400 new jobs. Final FY 2003 statistics show the agencys promotions generated 11,069 possible job commitments, a slight decrease from FY 2002s 11,790 commitments. A total of 123 new companies and companies with expansions made up the bulk of the job commitments (5,946).
Job Creation Statistics
Openings: 71 (FY03) / 73 (FY02) / % change: -3%
Closings: 38 (FY03) / 77 (FY02) / % change: 50%
Promotions: 210 (FY03) / 154 (FY02) / % change: -36%
Openings: 1,997 (FY03) / 1,188 (FY02) / % change: -69%
Closings: 2,988 (FY03) / 5,542 (FY02) / % change: 46%
Promotions: 11,069 (FY03) / 11,790 (FY02) / % change: 6%
Job Statistics by Industry Sector
Electric & Electronics 369
Rubber & Plastics 140
Apparel & Textiles 115
Apparel & Textiles 1,068
Electric & Electronics 968
Miscellaneous Manufacturing 361
Source: P.R. Industrial Development Co.
This Caribbean Business article appears courtesy of Casiano Communications.