Stark contrasts: Many expatriates in business enjoy six-figure salaries while others come to Bermuda from developing countries to do menial work at pay rates Bermudians find unsustainable. *iStock photos

Stark contrasts: Many expatriates in business enjoy six-figure salaries while others come to Bermuda from developing countries to do menial work at pay rates Bermudians find unsustainable. *iStock photos

Ordinary Bermudians are caught in the middle of an immigration cycle that keeps wages low and rents high, a Bermuda Sun Labour Day report shows.

International business has brought thousands of well-paid ‘money-no-object’ renters, often buoyed by large housing allowance payments, keeping rents among the highest in the world.

And a second wave of ‘wage no object’ immigrants from developing countries has priced Bermudians out of unskilled work and even some trades.

Businesses, particularly in the construction and restaurant fields, are accused of hiring cheap foreign workers in preference to Bermudians, to keep labour costs down.

There are estimated to be roughly 1,000 Filipinos working in Bermuda — many of them in unskilled jobs, some earning as little as $5 per hour.

Some migrant workers have complained that they are working long hours with no overtime pay and being asked to do work outside the terms of their contract.

But most keep quiet for fear of having their work permits pulled by employers.

Despite poor pay and working conditions they are earning many times more than they did in the Philippines, where the average annual salary is between $1,000 and $3,000.

One Filipino woman, who earned $11 per hour as a nanny, told us she was able to get by because she shared a small apartment with three other women, saving enough cash to send a small amount home each month.

At the other end of the spectrum, the influx of highly skilled, well compensated white-collar workers for the international business sector means the cost of living is now higher than ever in Bermuda.

The Bermuda Sun revealed in March that executives at an island based insurance firm were receiving payments of $40,000-a-month to cover housing costs — almost half-a-million dollars annually.

Industry insiders say those kind of payments are rare — but it is not unusual for exempt companies to cover the cost of rent for their employees, on top of six-figure salaries. According to a Government employment report, 1,439 guest workers received housing allowances in 2007.

And a HSBC worldwide survey, published this week, showed that for expatriates in professional jobs, Bermuda is among the world’s most lucrative destinations, with more than a quarter earning $250,000 annually.

Few dispute that international business has been good for many in Bermuda. But analysts, like Cordell Riley, suggest it has also contributed to a higher cost of living and a widening wealth gap.

In the midst of a recession, the effects are being felt more acutely than ever.

Reginald Harvey, a 46-year-old Bermudian carpenter, has been out of work since February.

Despite 25 years experience in the trade he has been unable to find a job. He has bills to pay, a daughter to support and insists he is willing to do any job available.

Mr. Harvey is one of roughly 1,600 Bermudians out of work as Labour Day approaches.

There are more than 12,000 non-Bermudians performing every type of job, from stacking shelves in a supermarket to carpentry on construction sites. So how is it that so many locals are jobless?

Louis Somner, of the Bermuda Industrial Union, believes firms are specifically targeting foreign workers because they are easier to exploit.

He is compiling a dossier of complaints from both foreign workers and Bermudians at job sites.

According to his files, one restaurant boss boasted: “All I have to say to keep my workers in line is ‘work permit, work permit’.”

A construction boss allegedly told employees: “Bermuda is great — it would be even better without Bermudians.”

Employers claim some of Mr. Somner’s allegations are exaggerated and unsubstantiated. But even industry insiders accept that some rogue employers do make unfair demands of foreign workers.

Frustrated

Alex DeCouto, who runs Greymane Contracting, said honest firms were equally frustrated. In a guest column today he calls on the Labour Ministry to do something about it.

“There are a lot of companies,” he writes, “going above and beyond to hire, train and promote Bermudians, and I can tell you that they are sick and tired of playing on the same pitch as these other firms.”

But he insisted a clampdown should be combined with concerted effort to address the skills and training gap across the construction industry.

Richard Powell, a Bermudian who has taken up the cause of Filipinos on the island, said exploitation was a common complaint.

He said many were afraid to speak publically for fear of having their permits taken away.

But he said the typical response to those who complained about working conditions, pay or being asked to do work outside of their permit was “if you don’t like it, go home”.

One Filipino waitress told us she had made a commitment to send $100 per week back to her family in Manila to pay college fees for her brother and sister and accepted long hours without overtime because she needed the money. She claims to have worked 60-hour weeks at $5.25 per hour.

Mr. Powell said most workers who came to Bermuda from developing countries were in similar situations — dependent on the job to help their families in desperate situations back home and prepared to accept any working conditions.

Those who do protest, he said, were quietly ushered out the door, with a host of others from all over the world ready to take their place.

More than 100 nationalities are now represented in Bermuda’s workforce — including some of the poorest countries in the world.

The difficulty in Bermuda’s affluent society, say experts, is that while many locals have benefited enormously from the influx of international business, those who don’t have the skills are left out in the cold.

Many can’t afford to accept the same jobs as someone from a less developed part of the world— $100 per week won’t pay for their children’s education.

Charles Brown, of the Government’s Sustainable Development unit, said the pattern was troubling.

“How many Bermudians do you see in restaurants taking out the trash or washing the pots?”

He said wages in unskilled jobs that might be tempting to a single expatriat from overseas were not affordable to many Bermudians.

“If you grow up in a country where washing pots pays $75 a week and you can do the same work in Bermuda for $600-a-week, you would gladly accept that.”

But while $600 per week (just over $31,000-a-year) might provide a living wage for a single expatriate sharing a small apartment, it’s a different story for someone with a family to support.

The ‘low-income threshold’ — sometimes called the poverty line — for a single person is classified as $27,000 per year. For a family with two children it is $76,000 per year.

It’s not a question of pointing blame; Mr. Brown says international business has brought great wealth to Bermuda and migrant workers are an essential part of the workforce.

But he believes that long-term, Bermuda needs to look at the bigger picture of how much and what type of economic development it can sustain.

He said there were already more than 40,000 jobs in Bermuda, with only 27,000 Bermudians employed.

“Even if those 1,600 people who are out of work were all employed we would still need a significant amount of imported labour.

“When we talk about job creation we need to think about how many jobs we can sustain. We need a discussion about how much economic growth Bermuda can take.”

Labour Day special report

As Labour Day approaches, the Bermuda Sun takes a look at the island’s immigration trends. We examined the influence of a reported influx of low-wage unskilled labour from overseas combined with the more familiar faces of the well-paid international business workers and asked — where does this leave regular Bermudians?