Correlation Between Unemployment Rates and Socioeconomic Factors in the Municipalities of Puerto Rico

Abstract

This study examines the relationship between municipal unemployment and three socioeconomic indicators, poverty rate, educational attainment, and broadband subscription, across Puerto Rico's 78 municipalities from 2019 through 2024. A custom .NET data pipeline ingests data from the Bureau of Labor Statistics Local Area Unemployment Statistics and the Census American Community Survey 5-Year Estimates, constructs a balanced municipality-year panel of 468 observations, and applies Pearson correlation, Spearman rank correlation, and Ordinary Least Squares multiple regression. The poverty rate emerges as the dominant correlate of municipal unemployment, with positive and highly significant coefficients in every annual cross-section and in the pooled model. Educational attainment shows a substantial bivariate correlation but loses joint significance when collinear with poverty. The broadband coefficient increases monotonically over the study window and becomes significant in the pooled specification. Findings support geographically targeted policy investments in the southern and southwestern municipalities with the weakest socioeconomic profiles and the highest unemployment rates.