A man begs for money in front of a closed-down business in Old San Juan, Puerto Rico, earlier this week. Only two of every five working-age people has a job or is looking for one in Puerto Rico. (Ricardo Arduengo/AP)

— Rafael Ortiz returned to Puerto Rico from New Jersey 20 years ago, eager to live the good life amid the sun-splashed beaches and verdant forests of his birthplace.

But more than ever, he finds himself lost in the cloud of uncertainty that grows thicker as this island’s economic problems grow more dire. He is wary of making improvements to his apartment. He hesitates to trade in his 1997 Mitsubishi, because he feels safer knowing he has the money in the bank. That way, he said, he could always opt to join the tens of thousands who flee to the mainland each year to escape the grip of Puerto Rico’s faltering economy.

“I never know when I might have to get out of here,” said Ortiz, 56, a clerk at a car-rental agency.

Ortiz’s doubts only deepened this week when Gov. Alejandro Garcia Padilla startled Puerto Rico and financial markets by declaring that the island’s debt of at least $73 billion is “unpayable.”

A former president of Puerto Rico’s central bank, who spoke on the condition of anonymity because his current employer does not want to anger the government, said Garcia Padilla’s declaration is sowing “a lot of confusion,” largely because, until recently, the administration was pursuing big new loan deals. Also, the governor has always said flatly that the government will pay its debts.

“That was a sudden change of direction,” he said, noting that the island’s three major banks all lost about a fifth of their value in recent days. “The governor put a lot of shock in the system.”

Garcia Padilla’s message was delivered in a televised address to the Puerto Rican people. But it was aimed at both policymakers in Washington and investors on Wall Street, who he hopes will come to the table to help forge a long-term solution.

So far, though, it is not clear that his words are having the desired effect. Many in Congress so far have balked at giving bankruptcy protection to the island’s heavily indebted state-run corporations, a tool that has allowed cities such as Detroit to restructure and get a fresh start. Meanwhile, big investors have shown few signs of being willing to offer more than short-term relief.

Oppenheimer, a mutual fund company that holds $4.5 billion in Puerto Rico bonds, including some that carry a guarantee written into Puerto Rico’s constitution, has said it expects the government to pay in full.

“We expect Puerto Rico to act within the tenets of the law, including the Commonwealth’s Constitution, and are ready to defend the previously agreed to terms in each and every bond indenture,” the company said in a statement.

The ultimate impact on creditors may be uncertain, but for Puerto Rican residents and businesspeople, the effects are as plain as increased taxes, reduced government services and a labor market in which just 2 out of 5 working-age people have a job or are looking for one.

Incentives have gotten so out of whack that a consultant’s report released by the government this week noted that for many Puerto Ricans, it is far more lucrative to stay home and collect benefits such as food stamps, utility subsidies and welfare payments than to get a job. Yet, the same report said, the island needs to find a way to lower its $7.25-an-hour minimum wage and loosen rules mandating paid vacation time and overtime to foster more employment growth.

Ordinary Puerto Ricans will be paying the price until those knotty issues are ironed out. On Wednesday, the island’s sales tax jumped to 11.5 percent from 7 percent. That increase comes after a series of cuts in government jobs, deep reductions in public pensions and steep hikes in utility rates, intended to raise revenue and dampen the need to turn to Wall Street to keep services functioning.

“In one way, we are getting used to it but at the same time, we’re fed up,” Ortiz said. “They keep putting more taxes, and everything is going up, up, up, but we keep hearing that we are deeper and deeper in debt.”

Even with all the new levies and belt-tightenings, government revenue has been lackluster. This week, officials said Puerto Rico’s annual budget deficit would be as much as $740 million — meaning the debt hole is that much deeper. The deficit is more than half a billion dollars more than was projected.

Given the numbers, many businesspeople here feel like a reckoning is inevitable. The debt has to be reduced and government has to be reformed to allow room for economic growth, they say. What worries them is how it all will play out.

“There are certainly a lot of people out there who are concerned about what the transition period is going to look and feel like,” said Federico Stubbe Jr., president of Prisa Group, a development firm. “On the other hand, I see some relief on the horizon. At least now there is a public realization that we will never get out of this without a strong economic plan. If you extend the time, you only extend the pain.”

Housing developer Alejandro Brito is among those surprised by the governor’s declaration that Puerto Rico’s debt is unpayable. Not that he disagrees with the conclusion. What baffles him is that it has taken so long for that reality to be acknowledged.

“The debt has been unpayable for years,” he said.