Question

How has the fact that thousands of people from Puerto Rico have moved to the United States to search for jobs likely influenced Puerto Rico's official unemployment rate? Explain your reasoning.

Short answer

Large firm sales now provide more to these shocks, implying that these scares have bigger magnitudes than when their involvement was minimal in the past.

Step-by-step solution

Step: 1 Unemployment:

Large companies have grown in importance in the economy, notably in terms of the proportion of their total sales in real $GDP$, which has climbed in recent years. Connect this to the idea that these huge corporations are better at protecting exports and imports from currency depreciation or appreciation.

Step: 2 Reason:

This has improved the economy's ability to withstand collective supply shocks. As a result, the fact that major enterprises' sales now contribute more with these shocks implies that these events have larger magnitudes than in the past, when their involvement was less.