Puerto Rico’s economy shrank 0.8 percent in March relative to the same month of last year, a notable improvement over the 2.5 percent annual contraction the island posted in February, the Government Development Bank for Puerto Rico said.
The March decline was the smallest since January 2013.
Even so, the U.S. commonwealth’s economy suffered an accumulated drop of 3.4 percent from July 2013 to March 2014 compared to the same period of the previous fiscal year, according to the GDB-PR’s latest Economic Activity Index, released Friday.
The index Puerto Rico uses to measure economic performance is based on four indicators: non-farm payroll employment (which fell 0.5 percent in March compared to March 2013), electric power generation (which was unchanged), gasoline consumption (up 20.2 percent), and cement sales (down 2.2 percent).
The employment drop in March was due to the elimination of 9,500 public-sector jobs, the GDP-PR noted.
The bank said public-sector employment fell 3.5 percent last month while private-sector employment edged up 0.8 percent thanks to the creation of 5,300 new jobs.
Non-farm payroll employment fell 1.7 percent in the first nine months of the current fiscal year compared to the July 2012-March 2013 period, while electric power generation declined 3.2 percent, gasoline consumption was down 0.6 percent and cement sales plunged 14.2 percent.
Puerto Rico’s economy has been mired in recession for most of the past seven years and its debt was downgraded to junk status by the Big Three credit rating agencies - Standard & Poor’s, Moody’s and Fitch - earlier this year.