Puerto Ricans Flock North Away From Battered Economy

{Los Legisladores del PNP están mudos, salvo José Aponte, Jenniffer, Gary, Soto, Tommy RS, y uno que otro no hablan. Para qué son Legisladores si no escriben en los periódicos o llaman a la radio y participan en programas de televisión? Hay que explicar que desde el 2001 al 2008, Sila/AAV casi triplican la deuda pública de $27 a $67 Billones Sin Obras. Quizás haya que hacer una gráfica de participación de Legisladores, Alcaldes y Dirigentes para que el electorado no los reelija? Para Mudos y Vagos es mejor no tenerlos.}

Puerto Ricans Flock North Away From Battered Economy

Exodus in Past Decade Was the Largest Since the 1950s

By  Arian Campo-Flores

connect

Jan. 6, 2014 7:57 p.m. ET

Juan Alvarez Fernos, an unemployed former taxi driver, lives at a friend’s place and plans to move to Texas. ‘There is no plan B,’ he says. José Jiménez-Tirado for The Wall Street Journal

SAN JUAN, Puerto Rico—Francisco Armstrong didn’t see much of a future for himself on this economically distressed island. A 27-year-old law-school graduate, he faced a job market saturated with candidates but short of opportunities.

So in November, he moved to Reno, Nev., to join his brother, a 24-year-old graphic artist who left two months earlier. Another 10 friends of his have bailed in recent years, he said, and most of his remaining circle are considering it.

«It’s sad how this island is losing most of its young talent,» Mr. Armstrong said one morning before leaving San Juan, sitting in his nearly empty apartment, where only a few pieces of unsold furniture remained. «But sometimes you feel pushed out.»

Seven years into a grinding downturn, Puerto Rico is experiencing a historic exodus of residents fleeing the island’s battered economy and rampant crime. From 2000 to 2010, a net 288,000 people left for the U.S. mainland, according to the Puerto Rico Institute of Statistics. The pace has accelerated in the past few years as the economic situation has worsened, with a net loss of 54,000 migrants a year in 2011 and 2012 on an island of just over 3.6 million people. Preliminary data for early 2013 suggest the outflow is still strong.

The U.S. territory also is grappling with $70 billion in debt, ratings firms have downgraded its bonds to one notch above junk and investors fear it could default on its obligations.

«A country that doesn’t have credit is destined to fail,» said Janette Mondo, a 46-year-old engineer who moved from San Juan to Basking Ridge, N.J., in August.

The financial turmoil figured into her decision to leave, she said.

The current wave of departures is the largest since the 1950s, when 470,000 Puerto Ricans left for the mainland. Back then, they were mostly rural and working-class migrants leaving for jobs at Northeast farms and factories, said Deepak Lamba-Nieves, research director at the Center for a New Economy, a nonpartisan think tank in San Juan. Because Puerto Rico’s economy wasn’t generating sufficient jobs, the government encouraged them to go, he said.

Today, many of the people leaving are young professionals the island wants to retain, said Mario Marazzi, executive director of the Institute of Statistics. Those who left in 2011 spanned a wide range of occupations, including roughly 2,700 food-service workers, 2,000 teachers and 180 lawyers, according to institute estimates. They moved to states across the U.S., with Florida, New York and Texas topping the list.

The exodus, combined with a declining fertility rate, has caused Puerto Rico’s population to slip to 3.62 million in 2013 from a peak of 3.83 million in 2004—a larger percentage decline than that of any U.S. state during that period. It is projected to drop to 2.98 million by 2050, according to the U.S. Census Bureau—about the same population the island had in 1975.

That could have profound effects on the territory, which already is struggling with a 14.7% unemployment rate. The population decline will shrink the island’s tax base, lower demand for goods and services, and reduce investment, economists say.

In addition, «if we’re losing young professionals, people at their most productive ages, we may have a huge problem trying to support the elderly population,» said Sergio Marxuach, public-policy director at the Center for a New Economy.

Some argue that the flow of people to the mainland has potential benefits.

«We’ve been migrating for decades,» Mr. Lamba-Nieves said. «Many of those will probably come back at some point.» And when they do, he said, they could bring new skills and entrepreneurial energy to invigorate the economy.

Yet the toll the departures are taking on Puerto Rico already is apparent. Nearly 320,000 housing units were vacant in 2012, up from 186,000 in 2005, according to census data. «For Sale» signs dot every block in some neighborhoods.

Each week, some of the island’s most talented professionals head to the airport with a one-way ticket to the mainland. Data from the University of Puerto Rico’s School of Medicine show that roughly 30% of its residents leave the island once they complete their training. In some specialties, such as family medicine or obstetrics and gynecology, the percentage is much higher.

The departures of doctors threaten to create shortages of certain specialists, like orthopedic surgeons and anesthesiologists, according to a 2012 study commissioned by the Puerto Rico College of Physicians and Surgeons.

School districts in the U.S. eager to hire bilingual instructors regularly scoop up Puerto Rico’s teachers. And employers like Boeing Co. and Lockheed Martin Corp. snag many of the island’s freshly minted engineers.

Those leaving include plenty of nonprofessionals as well. Juan Alvarez Fernos, 45, a former taxi driver, said he hasn’t been able to find a job for six months and has racked up about $20,000 in debt.

He said he plans to move to Austin, Texas, as soon as he receives an expected settlement check for a neck injury he sustained in a car accident. He already has sent more than 100 résumés for restaurant jobs there, and shipped 10 boxes of belongings to a friend in Dallas. «I’m just waiting to leave,» he said. «There’s no plan B.»

Gov. Alejandro García Padilla is trying to stem the flow by wooing investors, promoting tourism and stimulating agricultural production. He recently announced that since taking office last January, more than 25,000 jobs have been created—halfway toward his goal of generating 50,000 jobs in 18 months.

«This is not the first time our people have confronted big problems and managed to overcome them,» said Ingrid Vila Biaggi, the governor’s chief of staff.

She and others argue that migratory flows have always been tied to economic cycles. «If the situation starts to improve and the gap between the U.S. and Puerto Rico stabilizes, then the migration will taper,» said Vicente Feliciano, president of Advantage Business Consulting in San Juan.

Some Puerto Ricans are determined to stay on the island. Raúl Santiago-Bartolomei, 28, an engineer who got his undergraduate degree at the University of Puerto Rico at Mayagüez and a master’s degree at Cornell University, could probably have his pick of jobs on the continent. But he and his wife, a lawyer, said they plan to stay put.

«I guess it’s more of a national-pride thing,» Mr. Santiago-Bartolomei said. «It kind of saddens you to see that the country is crumbling. I have a sense of duty to stay.»

Write to Arian Campo-Flores at arian.campo-flores@wsj.com

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The scary thing about Puerto Rico’s population: It’s leaving the island for good

By Roberto A. Ferdman@robferdman3 hours ago

To the US! Reuters

Times are tough in Puerto Rico. The financial crisis has left the island buried in $70 billion in debt, and it’s on the verge of seeing its bonds downgraded to junk.

And people are leaving the island at a near record rate. The mass exodus seen in the 2000s is the worst since almost half a million people left in the 1950s (paywall). After growing gradually (but at a slowing pace) up to 2009, Puerto Rico’s population has since dropped by nearly 10%, according to US census data. In 2010 alone, the island’s population fell by over 6%, if the data are correct (that was also the year of the last census).

And that seems to be due to locals packing up and shipping off (mostly up north to the US). Migration to the US has long outpaced the number of people making the opposite trip, but in 2011, the most recent year for which data are available, the gap widened sharply.

All this bodes poorly for the island’s future. A shrinking population means a shrinking tax base, which the island’s massive debt and government’s appetite for spending can ill afford. It also means the economy is likely to experience further dips in demand for goods and services, and investment not only from within but from abroad as well.

Worst of all, there doesn’t seem to be any end in sight. If Puerto Rico’s financial troubles persist its people will continue to flee north. Couple that with the island’s quickly declining birthrate, and it’s population will keep falling. In a report released in 2011, Puerto Rico’s statistics institute estimated that its population would shrink to a mere 2.3 million by 2050 (pdf in Spanish), a 40% decline from 2000.