Dearer Food, Fewer Formal Jobs

Jamaica's consumer prices rose 8.6 per cent in the year to September, the Statistical Institute of Jamaica (STATIN) reported on 15 October. Food and non-alcoholic beverages rose 12.4 per cent over the year and transport 14.6 per cent. In September alone the index went up 1.5 per cent. Most of that came from food, and within food from vegetables, tubers, plantains, cooking bananas and pulses, up 10.5 per cent in one month, with tomato, carrot, lettuce, pumpkin, Irish potato and sweet potato among the produce STATIN named. Bank of Jamaica targets inflation of 4.0 to 6.0 per cent a year. On the Bank's own monthly series, September was the fourth month running above the top of that range.

The shortfall starts on the farm. STATIN's national accounts, released on 30 September, show agriculture, forestry and fishing producing 15.3 per cent less in April to June 2026 than a year earlier, mainly from lower output of fruits, yams and other root crops, and vegetables and condiments. The whole economy produced 2.9 per cent less than in the same quarter of 2025, though it grew 1.2 per cent on the previous quarter after seasonal adjustment. When Bank of Jamaica's Monetary Policy Committee met on 24 and 25 September, it blamed drought and the El Niño weather pattern for poor crop yields, and higher world commodity prices for dearer petrol. It voted unanimously to raise the policy rate by 50 basis points to 6.0 per cent from 29 September. Core inflation, which leaves out farm food and fuel, was 5.2 per cent in August against 4.2 per cent a year before. The Bank reads that as early, still limited, second-round effects on processed food and some services. Firms surveyed in July expected prices to rise 7.3 per cent over the next 12 months, up from 6.7 per cent in June, and businesses indicated likely wage pressures. The Bank projects headline inflation rising further in the near term and back in its target range by mid-2027, depending on how long the conflicts abroad last. Its next decision is due on 18 November.

The jobs figures look steadier than they are. STATIN's July 2026 Labour Force Survey, released the same day as the national accounts, puts unemployment at 3.4 per cent, against 3.3 per cent a year earlier. Over the same year employment fell by 21,900 to 1,419,200, while 21,800 more people were outside the labour force, 687,300 in all. A person without work counts as unemployed only while looking for it. Someone who leaves a job and stops looking drops out of the rate, so the rate barely moves. Employed women fell by 13,300 and employed men by 8,600. Youth employment fell 6.4 per cent to 169,500, and STATIN puts the rise in people outside the labour force largely down to 14,800 more young people leaving it. July is the first quarter since Hurricane Melissa in which the full survey ran in every parish, which makes it the first since the storm to allow every standard comparison with a year earlier.

The same release carries Jamaica's first official estimates of formal and informal work under the latest international standards, and two of its measures point different ways. Counted by the kind of business, the informal sector lost more workers, 12,300, than the formal sector, which lost 6,900. Counted by the kind of job, formal employment fell by 24,000 to 621,800, while informal employment rose by 2,100 to 797,400. That lifted the informal employment rate from 55.2 per cent to 56.2 per cent. Even inside the formal sector, 93,600 people hold informal jobs. Informal work is more common among men, at 63.1 per cent of employed men against 48.0 per cent of employed women. Under the international definition, an employee's job usually counts as informal when no employer contribution to social insurance is paid on it. In Jamaica that is the National Insurance Scheme, so a shift of this size thins the contribution records on which later pension and benefit claims rest.

Households meet both sets of numbers at once, and STATIN's release gives no breakdown of inflation by income. The Bank's statement says high and rapidly rising prices "disproportionately affect vulnerable Jamaicans", and it names weaker consumer purchasing power as one force that could temper price rises. September added costs that are hard to put off. Electricity and household rents lifted the housing division 0.7 per cent in the month, and private primary school fees for the new term raised the education index 4.0 per cent. The policy rate of 6.0 per cent now equals the top of the target range, and both sit 2.6 percentage points below September's annual inflation of 8.6 per cent.