Data: PR ‘brain drain’ rate picked up

Data: PR ‘brain drain’ rate picked up

By CB Online Staff

cbnews@caribbeanbusinesspr.com; cbprdigital@gmail.com

The exodus of college-educated people out of Puerto Rico picked up pace even as the overall rate of islanders leaving slowed slightly in 2012, according to a new report from the Puerto Rico Institute of Statistics.

The latest Migrant Profile, based on data from the U.S. Census Bureau’s Puerto Rico Community Survey, shows that roughly 75,000 people left the island in 2012, about 1,000 fewer than in 2011.

However, the number of people moving to the island dropped by nearly 3,000 to a total of around 20,000.

That means net migration was roughly 55,000 in 2012, the highest registered since the launch of the Puerto Rico Community Survey almost a decade ago.

The net migration of 55,000 people represents about 1.5 percent of the island’s population, the Puerto Rico Institute of Statistics report noted.

The median age of those leaving held at just under 30 years old (29.3), while the median age of people moving to Puerto Rico rose to 33.4 years old, contributing further to the rapid aging of the island’s population.

The percentage of people leaving who had some post-secondary education surged to 52 percent in 2012, up sharply from the 43 percent registered in 2011.

Much attention has been paid to Puerto Rico’s so-called “brain drain” problem that has seen tens of thousands of professionals and other working-age adults leave the island for the U.S. mainland amid the ongoing economic doldrums.

Progreso Económico, a quarterly report published by the island’s largest bank Banco Popular, says stemming the flow of human capital from Puerto Rico is key to the island’s economic recovery.

The percentage of people leaving who were outside of the labor force dropped to 45 percent in 2012 from 50 percent the previous year.

Broken down by job category, people working in services were the single largest group who left Puerto Rico in 2012 at more than 10,000. That was followed by sales and office workers (22 percent) and managers and professionals (20 percent).

The median income of people who relocated from Puerto Rico in 2012 was up slightly to $12,506. The medium income of those moving to the island decreased to $9,598.

Women accounted for 52 percent of the people who moved away from Puerto Rico in 2012.

Census data issued last week shows that the downward trend in Puerto Rico’s population shows no sign of slowing as the island’s economic downturn stretches into a ninth year.

The numbers shows that more than 3,000 people per month pulled up their stakes and left the island over a one-year period between July 2012 and July 2013.

The data also shows a sustained drop in the number of births in Puerto Rico, which totaled 38,846 between July 2012 and July 2013. There were 29,541 deaths during the period, resulting in a natural population increase of just 9,305 during that time.

By comparison, there were 59,542 births in 2000 balanced against 28,847 deaths.

Four of the island’s 78 municipalities already post more deaths than births, and demographers say the rest of Puerto Rico is heading in the same direction.

The latest data add to a mountain of evidence on Puerto Rico’s plunging population amid an ongoing recession, which economists and demographers warn will pose increasingly greater challenges to the island and efforts to shore up the government’s shaky finances.

The population loss and shifting demographics represent a range of challenges for the island, including the prospect of less federal funding, a shrinking tax base and increased budget pressures, lower demand for goods and services, reduced investment and a dramatically aging population with fewer financial resources.

Just over 11 percent of the population was at least 65 years old in the 2010 Census. That percent had risen to 15.6 percent in 2012 and projections show it doubling by around the middle of the century.

The population issue is also increasingly raising red flags on Wall Street regarding the island’s economic and fiscal future. All three credit rating agencies – Standard & Poor’s, Moody’s and Fitch – rate Puerto Rico credit one notch above investment grade and have warned of potential downgrades to a junk rating. They all have cited the population decline in recent reports on Puerto Rico’s credit.

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 and data show the outflow is still strong.

The pace of Puerto Rico’s population loss will pick up over the remainder of the decade and will decline by more than 8 percent overall by 2020, according to the latest projections from the island government’s Planning Board.

The new forecast projects Puerto Rico’s population (currently just over 3.6 million) will be under 3.36 million by 2020, down by more than 300,000 from the current population of roughly 3.61 million. The potential 8.3 percent decline would far outpace the 2.2 percent drop registered between the 2000 and 2010 census counts.

Puerto Rico’s population declined by nearly 37,000 people over the past year and continues to fall at a pace that would put it below 3.6 million next year, according to the latest U.S. Census Bureau data.

Puerto Rico’s population of 3.61 million is down from 3.72 million in the 2010 Census. The data show the estimated population fell to 3.86 million in 2011 and then again to 3.65 million in 2012 before declining to 3.61 million last year.

If that pace continues, the island’s population will drop into the 3.5 million range in 2014. It is projected to drop to 2.98 million by 2050, according to the U.S. Census Bureau — down from a peak of 3.83 million in 2004 and about the same population the island had in 1975.

The Puerto Rico Planning Board has also issued a special report on the island’s rapidly falling birthrate, as the government ramps up its study of population loss and its potential impact on economic development.

The number of live births on the island dropped from roughly 60,000 in 2000 to 42,000 by 2010, representing a reduction of nearly 30 percent or an average reduction of 1,700 live births per year.

That downward trend has continued amid an ongoing flight of young adults to the U.S. mainland during the local economic downturn.

Puerto Rico is among just two dozen national statistical areas around the world that lost population between 2005 and 2010, according to the United Nations.

As the global population topped 7 billion after an unprecedented surge of 1 billion over the past 12 years, Puerto Rico and 23 countries actually saw declines.

They are mostly former Soviet Republics and Eastern European countries. According to the latest U.N. count, of the 24 nations that registered population falls between 2005 and 2010 only Puerto Rico, Germany and some small island nations were not from this region.

A recent Wall Street Journal report noted that the current wave of departures is the largest since the 1950s, when 470,000 Puerto Ricans left for the mainland seeking farm and factory work in the Northeast.

The island government encouraged the mostly rural and working-class migrants to leave because the economy wasn’t generating nearly enough jobs.

Today, many of the people leaving are young professionals the island wants to retain, Mario Marazzi, executive director of the Institute of Statistics, told The Wall Street Journal. They moved to states across the U.S., with Florida, New York and Texas topping the list.

“If we’re losing young professionals, people at their most productive ages, we may have a huge problem trying to support the elderly population,” Sergio Marxuach, public-policy director at the Center for a New Economy, told The Wall Street Journal.

Some see a potential silver lining in the flow of Puerto Ricans to the mainland.

“We’ve been migrating for decades,” Deepak Lamba-Nieves, research director at the Center for a New Economy, a nonpartisan think tank in San Juan, told The Wall Street Journal. “Many of those will probably come back at some point.”

And when they do, he told The Wall Street Journal, they could bring new skills and entrepreneurial energy to invigorate the economy.

Still, the toll of the plummeting population is readily apparent around Puerto Rico.

Nearly 320,000 housing units were vacant in 2012, up from 186,000 in 2005, according to census data. Data from the University of Puerto Rico’s School of Medicine show that roughly 30 percent of its residents leave the island once they complete their training.

Puerto Rico’s public school rolls also continue to drop, with roughly 415,000 children spread throughout some 1,500 public schools. Public school enrollment peaked at nearly 713,000 students in 1980, but that number has been in decline as more parents send their children to private schools and the overall population falls.

The administration of Gov. Alejandro García Padilla is working to jumpstart the economy and curb the population loss through efforts to lure investors, spur the tourism industry and beef up agriculture.

“This is not the first time our people have confronted big problems and managed to overcome them,” La Fortaleza Chief of Staff Ingrid Vila Biaggi told The Wall Street Journal.

Vila echoed the argument by economists that the economy is key to stemming the outflow of islanders.

“If the situation starts to improve and the gap between the U.S. and Puerto Rico stabilizes, then the migration will taper,” Vicente Feliciano, president of Advantage Business Consulting in San Juan, told The Wall Street Journal.

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