Jamaica’s poverty rate expected to fall, says PIOJ

THE Planning Institute of Jamaica (PIOJ) is reporting that while Jamaica’s poverty rate, impacted by the novel coronavirus pandemic, increased in 2021, some improvement is expected when subsequent data are calculated.

It said the prevalence of poverty in 2021 was estimated at 16.7 per cent, reflecting an increase of 5.7 percentage points relative to 2019. The rates were compared with 2019 as no local estimate of poverty was available for 2020.

Speaking at the institute’s quarterly press briefing on Thursday, PIOJ Senior Director, Economic Planning, Research and Policy Logistics James Stewart explained that at the time the poverty rate was provided, the economy was still experiencing the conditions of COVID-19, including lockdowns and job cuts.

“Since then the labour force has recovered and…we expect that in subsequent releases of the Jamaica Survey of Living Conditions (JSLC), we do expect to see improvement in the poverty rate but for 2021 the conditions which prevailed at the time is reflected in the poverty out-turn presented,” he said.

At the same time, PIOJ’s Director General Dr Wayne Henry said Jamaica’s poverty rate is in keeping with expectations and experiences globally, noting that “we’ve seen poverty rates increase globally in many cases way above what we see in here”.

Highlighting the Government’s efforts in terms of the speed of recovery for Jamaica from the pandemic and the social protection programmes to offset the fallout, Dr Henry stressed that “we were very instrumental, we believe in ensuring that the poverty rates were not higher.

“So we are seeing the improvements going forward as reflected in economic performance as well as labour market record performances,” he said.

Providing a further breakdown of the figures, the director general noted that the data were collected over a five-month period from June to October 2021, a little over one year since the first case of COVID-19 was confirmed in Jamaica.

He said that the overall increase in the poverty rate was driven by increases in two regions as the rate in one region was statistically the same. Rural areas registered the highest rate at 22.1 per cent, followed by other urban centres at 15.5 per cent, and the Greater Kingston Metropolitan Area at 10.4 per cent.

“Relative to 2019, the prevalence of poverty increased in the Greater Kingston Metropolitan Area by 5.7 percentage points and rural areas by 7.9 percentage points, but remained relatively unchanged in other urban centres,” he said.

The director general said the COVID-19 pandemic negatively affected the lives and livelihood of persons leaving a legacy of rising poverty and widening inequality. He said that similar to most economies, Jamaica was still recovering from the COVID-19 pandemic in 2021.

He said the World Bank estimated that in 2021 about 97 million more people were living on less than US$1.90 per day because of the pandemic, increasing the global poverty rate from 7.8 per cent to 9.1 per cent. Additionally, 163 million more were living on less than US$5.50 per day. Globally, three to four years of progress toward ending extreme poverty are estimated to have been lost.

“While the Jamaican economy recorded growth of 4.6 per cent in 2021, and employment increased by 8.3 per cent in July 2021 relative to July 2020, real gross domestic product (GDP) was still 5.8 per cent below its 2019 level and employment was 3.3 per cent below what it was in July 2019. These factors explain the higher poverty rate in 2021 relative to 2019,” he said.

In the meantime, the PIOJ boss said that the 2021 edition of the JSLC, which tracks the effects of social and economic programmes and policies, is being finalised and will be made available to the public following its tabling in Parliament later this year, likely by September 2023.