The state government recognizes that Yucatán is going through an economic crisis in different sectors

The main sectors of the Yucatecan economy experienced a dramatic collapse in the first six months of the year due to the Covid-19 pandemic, an official report from the state government recognizes.

In this period, almost 20,000 formal jobs were lost and income from tourism and commerce, the great generators of employment in the state, fell seriously.

In the trade sector, the authorities foresee a very difficult recovery for the coming months, not only due to the increase in unemployment but also due to the drop in the purchasing power of the population.

As if that were not enough, public resources also fell sharply.

According to the Quarterly Report on Public Finances April-June 2020, the collection of state taxes fell 67.9 percent and federal participation in the state fell 572.3 million pesos. In this regard, the decrease is expected to reach 1.5 billion pesos by the end of the year.

Likewise, for the first time in several years, the Gross Domestic Product (GDP) of Yucatán experienced a fall. This time it was 0.8% in January, compared to the previous quarter, when a negative growth of 0.62% was recorded. (In 2018, GDP growth amounted to 3.7%).

According to the Quarterly Report, as a consequence of the collapse of economic activity, in the first six months of the year, 19,007 jobs were lost, which represented a decrease of -321.5% compared to the 8,579 jobs generated in the same period of 2019.

Although the report does not give figures on unemployment in the informal sector, it does say that “during the first quarter of 2020 the informality rate in the state registered a figure of 58%.”

The document adds that the repercussions of the contingency on the economy are not restricted only to employment, and highlights that the tourism sector has been one of the most affected, derived from the closing of borders between countries and the cancellation of massive events.

During the first five months of the year, the arrival of overnight tourists decreased 48.6% compared to the same period in 2019.

This, according to the report, had a direct impact on hotel occupancy, which registered 27.9% occupancy, a figure that decreased 29.1 percentage points compared to the previous year.

Visitors by sea also decreased. The number of cruises that arrived in Progreso, with data from June, fell -31.3% and in particular, as of March, the arrival of a single cruise was not registered. This obviously implied a decrease of -42.3% in the number of “cruise passengers” compared to 2019.

In the same sense, the arrival of passengers by air had a decrease of 46.8%, although, in June, the report indicates, a slight recovery was observed with an increase in passengers of 122% compared to May.

The arrival of visitors to the archaeological zones of the state, which represent one of the main tourist attractions, has also been affected by contingency measures. During the period from January to May, the arrival of national and international tourists to these sites registered a decrease of 41.2%

Regarding the commerce sector, the Quarterly Report indicates that the companies in this sector showed a decrease in the income generated, with wholesale commerce being the most affected by the contingency, presenting a 9% decrease in their income compared to the same period from the previous year. The retail trade, on the other hand, experienced a decrease in its income of 3.8%.

The Report emphasizes that “the outlook for the commerce sector is negative since although the results presented for the month of May show a negative difference with respect to income in 2019, this gap is expected to become even greater due to the reduction in the purchasing power, derived from unemployment, from the decrease in the arrival of visitors to the entity and from the decrease in the number of companies created ”.

The report indicates that another sector affected by the crisis is exports.

In the first quarter of 2020, a value of 236.03 million dollars was registered, which meant a decrease of -0.9% compared to the same period of 2019, when it had a value of 238.11 million dollars.

And finally, in the same period, Foreign Direct Investment registered a decrease of -16.5% compared to the same period of 2019.