Puerto Rico Economic Dev’t Bank confirms 169K local workers are self-employed
The Puerto Rico Economic Development Bank confirmed over the weekend that close to one-sixth of the island’s workers, or about 15.8%, are self-employed.
The data was provided at a press conference during the United Retailers Association’s (CUD in Spanish) convention, when EDB President Luis Alemañy said that as Pandemic Unemployment Assistance (PUA) benefits come to an end, the government is “ready to implement strategies to boost and protect employment in this new stage that we can predict will be beneficial for the island’s recovery from the pandemic.”
The PUA provided financial aid to 79,354 people in Puerto Rico who according to the program’s guidelines, lost their jobs because of the COVID-19 pandemic.
The Puerto Rico Department of Labor and Human Resources said that 169,500 people were self-employed in July, which represents a reduction of 11,000 self-employed, or 5.8%, when compared to the same month last year, Alemañy said.
However, the official added that “in cumulative terms, there is an increase in self-employment. Fiscal year 2021 closed with an average of 173,200 self-employed employees, 5.5% more than the 164,300 than during the same period in 2020.”
The US Internal Revenue Service defines self-employed individuals are those business owners or independent contractors who provide services to other businesses, are members of a society that exercises or operates a trade or business, or individuals who otherwise do business on their own. They are people who work for themselves, not for an employer or company.
Self-employed workers, in accordance with applicable local laws and regulations, and except for certain exceptions, are subject to paying income taxes, municipal taxes, and merchant registration, among other responsibilities.
“An argument that explains the upward trend in this category of employees is that as restrictions were implemented to prevent COVID-19 infections, as of March 2020, a considerable group of people chose to undertake self-management projects, reinvent themselves and operate on their own, since many of the main industrial sectors reduced their workforce, restricted operations or even resolved to close, temporarily or permanently,” Alemañy said.
The emergence of different niches of opportunities, such as the design, sale and manufacture of personal protective equipment — like cloth face masks and plastic face shields — or the manufacture, installation and maintenance of transparent acrylic separators, plexiglass or glass for commercial sites and offices also fostered this type of entrepreneurship.
“In addition, employees from other industries, such as construction, gardening and decoration, decided to work on their own, since the high demand for this type of specialized worker made it more lucrative for a self-employed person to set their own rates and hours versus earn a certain salary within a traditional worker-employer structure, public or private,” Alemañy said.