We are at a historical juncture, a very important one to build the foundation for Puerto Rico's economic development in the second decade of the 21st century. It is a unique moment in our economic history. Many economists and businessmen have called this moment the turn at bat and perhaps the only opportunity that Puerto Rico has to create the necessary infrastructure that allows for sustainable development and to be able to transform our business ecosystem into one of sustainable growth.
We need to transform the talent market and create a legislative framework that facilitates labor flexibility, writes Nilda Pérez Martínez. (Agencia EFE)
In order to comply with the payment of the approved debt and achieve the ideal business environment that allows economic growth and the formation of new companies, Puerto Rico needs a state-of-the-art work environment. However, the legislature of Puerto Rico continues to legislate laws based on obsolete paradigms of the industrial age that no longer fit future labor contexts.
An example of this is the P of C 1244. This project aims to repeal Law 4 of 2017, better known as the Labor Transformation and Flexibility Law. The main purpose of Law 4 was to liberalize the labor market in Puerto Rico. What does this mean?
In economics, liberalization is the process by which one goes from an economy subject to State control to a market economy, reducing the capacity of the State to intervene directly or indirectly in the economy of a country. The Labor Transformation and Flexibility Act represented a step forward in improving the regulatory environment that impacts the ability to operate a business in Puerto Rico. Precisely, this Law 4 was approved in 2017 as part of the economic development plan that Puerto Rico needs to be able to comply with the Debt Adjustment Plan. The main objective was to increase the labor supply, encourage the productivity of companies and raise the competitiveness of Puerto Rico. Unfortunately, the catastrophes of hurricanes, earthquakes and pandemics have delayed the desired results that were originally projected with the approval of the labor reform. It must be given the time to generate and make possible the desired results and strengthen entrepreneurship in Puerto Rico.
Approving Project P of C1244 would set back the advances and efforts made to build an environment in Puerto Rico that fosters the creation and maintenance of new businesses. We urgently need to understand the new vision that is dominating global labor markets. Automation and artificial intelligence are advancing at a dizzying pace in the workplace. More and more industrial processes are transformed by technology, requiring less human labor. The new opportunities that will arise will be based on the provision of services focused on the creativity and innovation of human capital. This means that the emergence of small businesses will be imminent and necessary.
This new era represents a great challenge and defiance for companies. Puerto Rico needs to temper its legislation so that it promotes a competitive, dynamic labor market, focused on people and talent. We need to promote laws that encourage the growth of new companies and ecosystems of innovative services. In the near future, the emerging and vibrant economies will be those that enrich and promote the generation of services based on the talent of human capital. We need to transform the talent market and create a legislative framework that facilitates labor flexibility.
We call on legislators to understand that we are no longer in the industrial age, when the focus was on union struggles between employers and employees. We are in the knowledge era, in which innovation, creativity and technology prevail by small companies capable of continuous transformation. Puerto Rico needs cutting-edge legislation that understands the new vision of labor contexts.
This piece was originally published in Spanish in El Nuevo Dia