Dr Wayne Henry, Chairman and Director General of the Planning Institute of Jamaica (PIOJ), has warned the nation to brace for a major hit to the economy with a possible shrinkage of between 11 and 13 per cent for the October to December quarter due to Hurricane Melissa.

He said it would be the worst fallout since the COVID-19 pandemic.

Henry disclosed the figure during his presentation at PIOJ’s Quarterly Review on the Economy and Outlook on Tuesday.

He said the Jamaican economy recorded fairly robust growth in the review quarter, reflecting the recovery from the impact of Hurricane Beryl in July 2024. However, going forward, the economy will face significant challenges arising from the catastrophic impact of Hurricane Melissa on Tuesday, October 28. 

“It is anticipated that the economy will record a sharp downturn during the October to December quarter, the worst quarter performance since the April to June quarter of 2020, when the island was impacted by the COVID-19 pandemic,” Dr Henry said.

He said the frequency of weather-related and other shocks has hindered the country’s ability to realise sustained economic growth. This highlights the need to re-examine and prioritise plans and initiatives to address the challenges that have hindered the country’s ability to foster more robust and sustained growth. 

Dr Henry said the impact of Hurricane Melissa has been far-reaching and is expected to push up unemployment and weaken spending across the island.

He said the damage to homes, the electricity grid, roads, and water systems is a major factor behind the expected slump.

For the full fiscal year ending March 2026, the economy is projected to decline between 3 and 6 per cent. Henry said the estimate could change as assessments continue.

Seven parishes that were hit hardest by Melissa produce most of the island’s agriculture and livestock and nearly all of its tourism infrastructure.

Before Melissa struck on October 28, Jamaica had been on track for strong growth of 3.1 per cent as the country recovered from Hurricane Beryl in 2024 and Tropical Storm Raphael.

Gross Domestic Product (GDP) grew 4.6 per cent in the July to September quarter this year compared with 2024. Growth was seen in both goods and services. Damage from Hurricane Beryl last year had reached $56.7 billion across several key sectors.

From January to September 2025, the economy grew 2.4 per cent. Goods grew by 5 per cent and services by 1.6 per cent. Unemployment stood at 3.3 per cent, one of the lowest levels on record.

Price increases are also expected after Melissa. The Bank of Jamaica said inflation is likely to rise above its 4 to 6 per cent target band. The BOJ expects inflation to return to normal levels by 2027.

Current estimates place the damage from Hurricane Melissa at US$9 billion.