Employment in Costa Rica’s free-zone regime fell year over year in July for the first time in seven years, ending a long stretch of job growth in one of the most important economic industries. Free-zone companies employed 200,203 salaried workers in July 2026, down from 202,408 in July 2025, according to Costa Rican Social Security Fund data. That represents a net loss of 2,205 jobs, or 1.1%.
The decline was concentrated in business services, a broad category that includes shared-service centers, customer support, finance, technology, and other corporate operations. Employment in that sector fell by 3,034 positions, from 99,517 workers in July 2025 to 96,483 this July.
Business services remain the largest employer within the free-zone system, accounting for about 48% of its workforce. It was the sector’s first year-over-year employment decline since at least 2020, although its rate of job growth had already been slowing since 2023. The overall free-zone decline was smaller than the loss in business services, indicating that other activities continued to add jobs and partially offset the drop.
Manufacturing, which accounts for another 37.3% of free-zone employment, has remained near 74,000 workers for 15 consecutive months. Together, business services and manufacturing represent roughly 85% of all employment under the regime. Economists and business representatives have pointed to several pressures behind the slowdown, including multinational restructuring, automation, artificial intelligence, weaker demand abroad, and uncertainty surrounding international trade.
The strong colón has also increased pressure on companies that earn revenue in dollars but pay salaries, utilities, and other local expenses in Costa Rican currency. The dollar traded at ₡507.17 on July 31, 2025, compared with ₡451.10 on the same date this year. That means dollar-earning companies need more foreign currency to cover the same expenses in colones.
The Association of Free Zone Companies, known as AZOFRAS, said the slowdown should serve as a warning that Costa Rica needs to improve the conditions that have helped attract and retain multinational investment. The group cited electricity costs, infrastructure, flexible work schedules, workforce training, and the exchange rate among the issues requiring attention.
The employment figures come as Costa Rica’s Central Bank expects production growth in the country’s special economic regimes, which include free zones, to slow sharply. The bank forecasts growth of 4.6% in 2026, compared with 12.7% in 2025. The Central Bank has linked the cooling to weaker external demand, slower growth among Costa Rica’s main trading partners, and more moderate exports of medical equipment after an unusually strong performance last year.
Despite the job decline, free zones remain central to Costa Rica’s economy. Companies operating under the regime produced 67.3% of the country’s goods exports during the first seven months of 2026, accounting for $9.31 billion of the national total of $13.82 billion.
PROCOMER’s most recent full-year study found that free-zone companies generated 197,038 direct jobs in 2024 and more than 265,000 positions when indirect employment was included. The regime represented about 15% of gross domestic product and paid an average monthly salary almost twice the national average.
The July data do not show that the free-zone system is collapsing, nor do they represent a confirmed tally of layoffs by individual companies. They measure a net decline in registered salaried employment across the regime. Still, the reversal is significant. Free zones have driven much of Costa Rica’s recent export growth and formal job creation. The latest figures show that continued investment and rising exports no longer guarantee that employment will grow at the same pace.
