By Andrew Laidley
KINGSTON, Jamaica, (JIS) – Jamaica is not in a recession, despite recent economic challenges, says Director General of the Planning Institute of Jamaica (PIOJ), Dr Wayne Henry, speaking at a PIOJ Quarterly press briefing, February 19, at the Don Mills Training Room, addressing concerns about the island’s economic performance, citing a comprehensive analysis of key indicators.
“While we acknowledge the downturn in economic output, our assessment based on the most recent data and information available is that the Jamaican economy is not in a recession,” Dr Henry emphasised.
The determination follows a period of scrutiny prompted by data from the Statistical Institute of Jamaica (STATIN) showing a decline in seasonally adjusted real value added at constant prices for the April to June and July to September 2024 quarters. Dr Henry clarified that while this data initially suggested the economy met one technical criterion for a recession, a more holistic view provides a different picture.
“The use of gross domestic product (GDP) alone to determine a recession has its shortfalls,” Dr Henry explained. “It is often better to consider a wider set of measures of economic activity to determine whether a country is indeed experiencing a recession. Specifically, economic indicators, such as income, employment, and fiscal health, should be taken into consideration to reflect a more comprehensive view.”
One of the most compelling factors supporting the PIOJ’s assessment is the strength of Jamaica’s labour market.
“The unemployment rate for October 2024 is 3.5 percent, and employers have also lamented challenges and shortages in filling some vacant positions,” Dr Henry noted. “This suggests that despite the temporary contraction in output, the labour market continues to remain robust and may be considered a lead indicator of a return to growth in the short term.”
Dr Henry acknowledged the impact of recent hydrological events, including hurricane Beryl and Tropical Storm Raphael, which significantly affected key sectors such as tourism, electricity and water supply, and agriculture, forestry, and fishing. Despite these challenges, Dr Henry expressed optimism about the near future.
“Based on the most recent data and information available, the PIOJ is projecting that the economy will return to positive output performance, that is growth, in the January to March 2025 quarter,” Dr Henry added. “We will continue to monitor and track developments in the economy, and we’ll update our assessment as new data becomes available.”
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