PIOJ Projects Growth Rebound in October to December 2026 – PIOJ

The Planning Institute of Jamaica (PIOJ) says the economy is expected to return to growth in the October to December 2026 quarter, following the devastation caused by Hurricane Melissa.

Director General at the PIOJ, Dr. Wayne Henry, gave the projection during the PIOJ’s hybrid quarterly press briefing on Tuesday (November 25).

He said that the economy is expected to contract within the range of 11 to 13 per cent during the October to December 2025 quarter, with the out-turn for fiscal year 2025/2026 to reflect a decrease in economy activity within the range of three to six per cent.

Dr. Henry explained that prior to the passage of Hurricane Melissa, the economy was poised for strong growth, reflecting economic recovery following the adverse hydrological events of fiscal year 2024/2025.

“Growth of 3.1 per cent was estimated for the first half of the current fiscal year and this was expected to continue throughout the second half,” he said.

He noted that unfortunately, Hurricane Melissa has altered this outlook, as it will place significant downward pressure on most industries during the October to December 2025 quarter.

The category-five hurricane had significant impact on residential and productive assets, including the housing stock, the electricity generation, transmission and distribution network, the road network and water supply infrastructure.

“It is expected that there will be a significant fall in output and demand during the short to medium-term. This out-turn would end the three consecutive quarters of economic growth, which reflected the gradual recovery from the passage following the passage of Hurricane Beryl and Tropical Storm Raphael during the latter half of 2024,” Dr. Henry outlined.

He noted that the damage from Hurricane Melissa is unprecedented and far-reaching, affecting all industries, resulting in increased unemployment, weakened demand and output, with agriculture being one of the most severely impacted sectors.

“The seven most affected parishes account for approximately 74 per cent of total hectares of land devoted to domestic crop production as well as a significant share of animal farming and export crop production,” he pointed out.

Dr. Henry said there was significant damage to farmlands, fishing equipment, access roads, residential infrastructure, transportation equipment, as well as a loss of livestock.

He noted that the accommodation and food services industry is the second most impacted sector, with the seven most affected parishes accounting for approximately 89 per cent of total hotel room stock.

“Infrastructure damage to some properties and impeded access has resulted in the temporary closure of some accommodation sites. There was a temporary closure of all three international airports combined with below full-capacity operations on resumption,” he pointed out.

The impact of the hurricane, combined with the November 2025 United States level-three travel advisory recommending its residents reconsider travel to Jamaica at this time, is expected to adversely impact visitor arrivals.

Disruptions in the electricity, water supply and waste management sector are also expected to contribute to the downturn in the economy.

“There was significant damage to electricity generation, distribution and transmission infrastructure, particularly in western parishes. Full recovery is likely to be significantly delayed given limited accessibility to some communities,” the Director General pointed out.

He said that significant damage was also done to the nation’s water infrastructure.

“Although some progress has already been made with respect to the restoration of water supply to affected communities, the timing of full restoration is partly dependent on the availability of electricity to provide power to the pumping stations,” he said.

Dr. Henry added that the construction sector will also face impacts from lost days of productive activities, as large projects, particularly in the affected parishes, have been temporarily halted.

Additionally, there is expected to be a general delay in disbursements on major capital projects to facilitate assessments of their status.

The PIOJ Director General noted that damage to information and communication infrastructure will lead to reduced customer base and sales in the upcoming quarters, while land, maritime and air transportation services are expected to be curtailed due to the damage to the road network, airports and shipping ports.

Dr. Henry pointed out the sharp downturn expected during the October to December quarter would be the worst quarterly performance since the April to June quarter of 2020, when the island was impacted by the COVID-19 pandemic.