Michael Fahy on Employment Statistics

July 10, 2010

dream_job_next_exit[Written by Michael Fahy] The inappropriately named “highlights” are hardly surprising. These statistics demonstrate that all is not well with Bermuda’s economy. A loss of 693 jobs in the local labour market is frankly very bad. It is also unsurprising that the release cited the reason for this plummet as the global recession. Whilst it is certainly fair to say that the global economic down turn has been a major contributor to the decline in jobs in Bermuda through 2009, it would also be more fair to say that poor leadership and poor decisions leading up to the downturn has likely exacerbated the problem.

International business posted the largest share of job losses with a 7% decline. Whilst Bermudians are often protected from job losses due to guest workers leaving and permits not being renewed, it is fair to say that in the international business sector guest workers more often than not create jobs for Bermudians, particularly in the servicing of international business. Lack of growth in this area means less Bermudians employed. Lack of growth essentially means there has been more than a 7% decline since such a sector should increase year on year. We in the BDA have been saying for a while, as has international business, that there is a quiet job loss in this sector, with more and more companies not seeing Bermuda as competitive as we believe it to be.

Our information is that the payroll tax increase has seen a number of well known high profile international companies seriously consider looking elsewhere to relocate their operations. We are literally on a knife edge in terms of flight. Such a flight would not be one mass exodus – rather a continuing trickle which has already begun in many companies with the moving of IT professionals back on-shore. Just because a company owns a building or has a long lease does not mean they need to stick around.

These statistics will only get worse through to the end of 2010. As the construction industry shrinks, watch for unemployment to go way up in that industry, an area where vast numbers of Bermudians are employed. Employment in tourism is also unsurprising and will only get worse – it is hardly a platinum period. The Department of Immigration can only do so much to protect Bermudians in a down turn through work permit non renewals.

Again this is not scaremongering. Ask around. Look around. How many of your friends have been made redundant? How many people are leaving the island? We can only hope that the electorate will listen to this message and push for real change before it is too late.

Read More About

Category: All, News

Comments (1)

Trackback URL | Comments RSS Feed

  1. Jade says:

    There is only one reason to increase complexity taxes in a period of recession and job loss, it’s the only cash flow the government has left. Ever used to submit payroll taxes for your company and be stunned how long the cheques took to clear? Those days are long gone; our last two payments zoomed through our bank in 2 days (and using “zoom” to describe a government process is unprecedented)… ever submit an invoice to a government department recently? Timing is everything – invoices approved in early December were sat on with “do not pay orders” until after the Jan 15 payroll tax cash came in (unless you had connections, as many do, to expedite your payments). The only payments that were made regularly, on time, were payroll… ordinary payroll – not amounts for contract workers.