FRIDAY, MARCH 16: Having studied both economics and finance, I understand that debt can be either viewed as good or bad. Those that oppose the Government will say that the debt level is unacceptable and they will preach that this means doom and gloom for future generations. Conversely, those who support the Government will argue that the debt level is sustainable and was accumulated through investment.
The facts on our debt are that Bermuda’s debt to GDP ratio remains within the 0-30 per cent range. At this debt ratio range, the level of debt is deemed by economists to be very sustainable. This is due to the fact that at this debt ratio range a country’s debt has no bearing on the ability of its economy to grow.
The fact that Government revenues in Bermuda are directly linked to the growth of Bermuda’s economy and that our current debt has no bearing on the country’s growth, means that it does not influence the Government’s ability to collect revenues to repay debt. Research by Carmen Reinhart and Kenneth Rogoff purports to show that economic growth slows dramatically once the gross-debt-to-GDP ratio crosses the threshold of 90 per cent.
This article attempts to change the mindset of the readers to realize that the current level of debt has no bearing on the many opportunities that still exist in Bermuda. I do believe that the current debate on debt has dragged on long enough and we now need to begin to look at opportunities in our local economy.
The hotel and restaurant industry is an area within our economy where many opportunities still exist for those looking for employment. According to figures from the Department of Statistics, roughly 46 percent of the over 4000 jobs in our hotels and restaurants were held by non-Bermudians. This creates opportunities for Bermudians who are unemployed. Job categories that are filled by a majority of expat workers include: Waiters/waitresses, chefs, porters, maitre d’s, pot washers, beauticians.
If individuals prepare their selves for jobs in these categories, they have a high probability of finding one.
In addition, Bermuda’s total visitor arrivals in 2011 was the second highest in our history, only surpassed by the level recorded in 2007. The island saw 655,236 visitors arriving for the year, representing an increase of almost 12 per cent. I find it strange when I hear people saying that the tourist industry in Bermuda is dead, the numbers certainly don’t reflect that.
With 655,236 visitors arriving on our shores, when are we going to realize that this creates some sort of opportunity for us? Some will say that the majority of the visitors are cruise visitors and they do not spend any money. I say let’s find ways to get their money.
If you have a good or service that they want, they will most likely spend money for it. Understanding our customers and providing goods and services will translate into increased job opportunities for all.
Let’s replace the pessimist state of mind when it comes to jobs and let’s seize the opportunities in our midst.
• Jason Hayward is First Vice president, BPSU.