JAMAICA had fewer people in formal employment in July, but more working in jobs without formal employment arrangements or protections, according to new figures from the Statistical Institute of Jamaica (STATIN).

Informal employment increased by 2,100 to 797,400 compared with July last year, while formal employment declined by 24,000. More than half of employed Jamaicans — 56.2 per cent — were in informal jobs, up from 55.2 per cent a year earlier.

The increase was concentrated among employees, with 38,400 more in informal employment. Their numbers rose even as informal employment among independent workers without employees and dependent contractors declined.

The findings come as the economy makes up ground following Hurricane Melissa, but remains below its output of a year earlier. According to economist Keenan Falconer, they also reflect a longer-standing difficulty in creating a wider range of employment opportunities.

“Meaningful economic growth expands our range of employment options through the addition of more complex industries, but this process has been slow. As a result, persons are driven to create more opportunities in the informal sector,” he told the Jamaica Observer.

STATIN’s latest economic figures show that output fell by 2.9 per cent in the April to June quarter compared with the same period in 2025. Agriculture, mining, accommodation and food services were among the industries recording substantial declines.

Compared with the first three months of 2026, however, the economy grew by 1.2 per cent after adjustment for seasonal patterns. That improvement meant Jamaica was producing more than in the preceding quarter, though still less than a year earlier.

The July employment survey recorded 21,900 fewer employed people than in July 2025. The modest increase in informal employment occurred alongside a much larger fall in formal employment, raising informal jobs’ share of the smaller employed population.

Asked whether an earlier Ministry of Labour and Social Security assessment linking informal employment to limited formal-sector opportunities and persistent slow growth remained relevant, Falconer said he believed it did.

“I believe the situation is the same, and it becomes especially acute after each economic shock,” he told the Business Week, adding that insufficient economic diversification compounds the problem.

The latest gross domestic product (GDP) figures show how uneven the recovery in Jamaica remains. Agriculture, forestry and fishing contracted by 15.3 per cent compared with April to June last year, reflecting lower production of fruits, yams, and other root crops and vegetables and condiments. Mining and quarrying fell by 26.1 per cent because of reduced alumina and bauxite production.

Accommodation and food service activities declined by 12.3 per cent, driven by a 21 per cent fall in foreign national arrivals and the continued closure of some hotels. Manufacturing and construction recorded small increases of 0.1 per cent and 0.4 per cent, respectively, while financial and insurance activities grew by 3 per cent.

Informal employment refers to jobs that lack formal employment arrangements or protections, such as paid leave, pension or National Insurance Scheme contributions, or written contracts. These jobs can exist even within registered businesses. STATIN counted 93,600 people in informal employment in the formal sector in July.

Employment in informal businesses — those operating without formal registration or accounting arrangements — fell by 12,300 to 671,700. The increase was in informal jobs across the economy, rather than in the number of people working in informal establishments.

Among employees, informal employment rose to 311,500. Meanwhile, informal employment among independent workers without employees declined by 18,100 to 383,300, and among dependent contractors by 9,900 to 52,900.

Falconer suggested that greater use of short-term contracts and the expansion of gig work could be contributing to the changes. These are possible explanations; the survey does not establish why informal employment increased, and a fixed-term contract does not necessarily make a job informal.

“Still further, the increase in contract work could also be related to the recent rise in the gig economy where persons are increasingly performing short-term tasks. While it offers greater flexibility, particularly in doing multiple jobs for different employers, it could also be an indication that this is borne of economic necessity and the inability to find formal employment,” he said.

Meanwhile, the implications for workers include both the protections attached to their jobs and the certainty of their income.

“However, if more persons are holding informal jobs then they will not benefit from certain labour-related protections and potentially have fewer legal recourses during industrial disputes,” Falconer said.

He also pointed to the difficulty of making longer-term financial commitments when work is secured only for short periods.

“This, however, has implications for persons wishing to access long-term loans and credit as it will be difficult to confirm the consistency and certainty of income beyond a specific period in the near future,” he said.

Despite the decline in overall employment, Jamaica’s unemployment rate remained almost unchanged at 3.4 per cent, compared with 3.3 per cent a year earlier. STATIN said many people had moved outside the labour force, with that population increasing by 21,800 to 687,300.

July was the first quarter since Hurricane Melissa in which the full labour force questionnaire was administered in all parishes. It also marked the first official release of formal and informal employment estimates from the revised survey, with corresponding figures for July 2025.