Output: GDP Versus GNP
Real GDP grew just 0.3% in fiscal 2025 (July 2024 to June 2025), to $103.9 billion in 2017 dollars, according to the Department of Economic Development and Commerce. Real GNP, which counts only income that stays on the island, was $69.9 billion. The gap of more than $30 billion is mostly the profits of multinational manufacturers, chiefly pharmaceutical and medical-device makers, that are booked in Puerto Rico but paid out abroad. For residents, GNP is the better measure of living standards.
The Planning Board and other forecasters expect growth below 1% for fiscal 2026.
Jobs: The Bright Spot
Unemployment averaged about 5.6% in 2025, the lowest on record, and is — now. Payroll employment averaged about 963,000 jobs in 2025, up 0.9%; over the latest twelve months the change is —. The weakness is participation: only about 45% of adults are working or looking for work, against roughly 62% on the mainland, so many adults sit outside the labor market.
Unemployment: Puerto Rico and the U.S.
Monthly unemployment rate, five years.
Structural Forces
Population: about 3.2 million and roughly flat in 2024 after years of decline, which limits the workforce. Federal money: recovery and mitigation funds after Hurricanes Irma and María, projected at about $69 billion, are still being spent on the grid, water, housing and roads. Energy: power is expensive and unreliable, and the electric utility PREPA’s debt has been in court-supervised restructuring since 2017. Manufacturing: about 83,000 jobs, 9% of the total, with pharma reshoring the main growth hope.
The Tax Picture for Investors
Residents generally do not pay federal income tax on Puerto Rico-source income; they pay Puerto Rico income tax instead. Act 60 offers decrees with reduced rates to new resident investors, exporters of services and manufacturers. The island’s government bonds, restructured in 2022 under the PROMESA process, are exempt from federal, state and local income tax for most U.S. holders.
Takeaway. Puerto Rico is a slow-growth economy with a tight job market. Its outcomes depend on how well federal funds are spent and whether the power grid gets fixed.
Figures in copper come straight from FRED and update every weekday; other figures are as of October 21, 2026. For education only, not investment advice.