FRIDAY, SEPTEMBER 30: More than 150 jobs were lost to Bermuda yesterday following the closure of Willowbank hotel and the decision of Citigroup to relocate a large chunk of its staff overseas.
The closure of the Sandys hotel was formally announced yesterday morning with chairman Fernance Perry confirming 46 jobs would go.
The news got worse by early afternoon when financial services giant Citigroup revealed it was shifting 105 accounting and ‘operations’ jobs to the US and Canada. The Bermuda-based staff will be offered the opportunity to relocate to Columbus, Ohio or Mississauga in Ontario, Canada.
The announcements follow Bacardi’s decision to cut 13 jobs earlier this week.
Economy Minister Kim Wilson said the economic challenges facing the country were ‘indiscriminate’ and were being felt across ‘all sectors of the community’.
She insisted: “I remain steadfast and committed to seeking and implementing solutions which we are optimistic will stimulate an economic turn around.”
The move by Citigroup to transfer jobs overseas in an effort to ‘reduce expenses’ and ‘create efficiencies’ is believed to have significant implications.
Peter Everson, chair of the Chamber of Commerce’s economic division warned: “Large global players have great insight into direct cost comparisons between competing locations and thus their statement of “efficiency” must be interpreted as “we can do this cheaper elsewhere”.
Shadow finance minister Bob Richards insisted the global economy could not be blamed for the defection.
He said: “They are moving whole departments to the US and Canada. I think that is very important because this is not a case of the company downsizing. This is a case of Bermuda being uncompetitive and them moving jobs out of Bermuda.”
He said it was a bad-sign for the island if businesses felt it was cheaper to have staff in Canada, which has some of the highest tax rates in the world.
In an official statement Nina Das, of Citigroup, said: “Citi has decided to relocate some of its functions currently being performed out of its Bermuda office to its Center of Excellence sites in North America.
“This effort is being undertaken to consolidate Citi’s support functions, reduce overall expenses and create operating efficiencies.”
A breakdown of how many Bermudians were affected compared with work permit holders was not available yesterday.
But Mr Everson warned that both had an impact on the island. He said empty apartments and a declining population impacted local residents and businesses, leading to further unemployment.
“My analysis indicates that the “secondary” job losses will be of the order of 20-25 percent or another 25 jobs.”
George Hutchings, chairman of the Association of Bermuda International Companies, said he was unable to comment specifically on Citi’s departure. But he said Bermuda needed to do everything it could to support international business.
“Bermudians, businesses and Government must be as accommodating, efficient, cost effective and friendly as possible at every conceivable touch point with international business.
“The entire island needs to think of international business as our personal clients because those organizations indirectly pay virtually all of our bills regardless of who you may be.”
Ms Wilson said the labour department was reaching out to the management of both Willowbank and Citigroup to lend assistance to employees affected.