WEDNESDAY, MAY 30: “Jobs, jobs, jobs.” The newest mantra. What exactly does it mean? Jobs for Bermudians? Or jobs in Bermuda for Bermudians? There is a crucial difference.
Jobs for Bermudians means the aim is to keep 28,881 Bermudian workers employed. This means all policy and practical decisions taken with the aim of keeping Bermudians in a paying job.
Given that objective, the best way is to monitor the number of Bermudians who lose their jobs. Whenever that number rises, revoke another batch of Work Permits and send another batch of Guest Workers scuttling back to their home countries.
The theory is that unemployed Bermudians can take over the jobs that have been ‘freed up’ by those Work Permit revocations. Doing this means treating the jobs held by Guest Workers as part of a “job bank” or “national reserve” of jobs that Bermudians can always fill.
At its simplest, it works like this: Government learns that there are 500 newly unemployed Bermudians. Government revokes 500 Work Permits thus “creating” five hundred new job openings. Bermudians shuffle about and fill these 500 new job openings.
This theoretical job creation — for Bermudians — can keep happening until all 8,374 (in 2011) Guest Workers have been sent home and there are only 28,881 (26,187 in 2011) Bermudian workers left.
For three decades, that is exactly the way that the previous Government saw, thought about, and used the Guest Worker ‘pool’. They treated it as a ‘national reserve of jobs’.
The way the Guest Worker numbers fluctuated between 1980 and 1994 confirms that. Starting at 5,478 in 1980; up to 8,351 in 1988; down to 6,941 in 1993; back up to 8,270 in 1998. This fluctuation showed a degree of control and management.
But more was happening. The decade 1987 to 1997 was also a period of major economic change because Bermuda was changing its national business model. Bermuda was shifting out of Tourism into International Business.
However, if today, the aim is to keep all Bermudians in employment, then that pre-1998 management theory can be re-applied until Bermuda’s economy shrinks to where there are only 28,881 — or fewer — Bermudian workers left, but with every Bermudian worker still employed. At that point:
• Bermuda’s GDP might be about $2,500m — down about 55 per cent from current levels;
• average employment income might have dropped to $35,000 — down about 60 per cent from current levels;
• Government revenue will have fallen to about $500m - down about 55% from the $910m projected for this year; and
• Government spending would have to fall to match the $500m - $600m revenue level - about half what it is now. (But Debt Service Costs won’t drop. Oh no, they’ll stay well over today’s $115m a year...]
At the 28,881 Bermudian — and no Guest Worker — level, Bermuda will have a severely shrunken Third World economy with all Bermudians scrabbling for a subsistence level existence.
That will be the predictable and absolute outcome of any national policy focusing solely on providing jobs for Bermudians.
The alternative? Provide jobs IN Bermuda. The difference is not subtle. It is huge, like the difference between death and life.
Providing jobs IN Bermuda means taking all possible steps to ensure that Bermuda has an economy and functioning business model that requires 40,000 to 42,000 jobs that are performed ON the island of Bermuda.
Within that pool of 40,000 to 42,000 jobs, those 28,881 indigenous Bermudians can find employment that fits their skill-sets. Those Bermudians then earn incomes that allow them to meet their reasonable aspirations.
A Bermuda economy that employs 40,000 to 42,000 people is an over-size economy. It may seem odd to suggest that Bermuda must have an over-size economy. But, it is not odd. Bermuda has had an over-size economy since the Tucker’s Town development of the 1920’s. Bermuda’s wealth and success is predicated on the existence - ON and IN Bermuda — of an over-size economy. An economy so large and so vibrant that it requires the importation of additional labour and human capital.
Bermuda’s global top ten GDP-per-capita and high average employment income ($80,996 in 2010) are the consequence of a successful over-size economy operating in Bermuda. Bermuda has been that way for over 90 years — since the 1920s.
Instead of jobs FOR Bermudians, the critical objective must be to maintain jobs IN Bermuda. Bermuda needs to protect, sustain, maintain, and nowadays re-grow, its unique and historically over-size economy. Bermuda can only do that by encouraging the on-Island presence of thousands of Guest Workers.
If Bermuda aims solely to preserve jobs FOR Bermudians, Bermuda will — absolutely — commit economic hara-kiri as it overturns its 90-year history and shrinks to a down-sized economy. Strange, but true — Bermuda needs to build-up, not reduce, its Guest Worker pool.
Bermuda needs to maintain and re-build its 90-year-old over-sized economy.
At only 37,399 jobs in 2011, Bermuda has already gone twelve years backwards. Employment has dropped below the employment levels last seen twelve years ago in 1999 when there were 37,849 jobs in Bermuda. In 2012, Bermuda’s economy is still down-sizing. In 2012, jobs are still disappearing.
“Jobs, jobs, jobs.” Yes. But jobs IN Bermuda FOR Bermudians.