Island survey puts our jobless count in context

Bermuda has the fourth-highest jobless rate of a series of island jurisdictions examined in a new survey.

The island — with a jobless total of eight per cent — comes in behind the Bahamas, Cyprus and Barbados in the unemployment league.

And the island is singled out as one of the countries that has had to go heavily into the red in a bid to keep afloat financially.

Business rival Cayman is in seventh place in the jobless totals, with an unemployment rate of just over six per cent, according to the Island Monitor report for the first quarter of the year.

And it said that Jersey, Malta, Hong Kong, Singapore, the Isle of Man and Guernsey all have between half and an eighth of the Bermuda jobless total.

Even Iceland — which suffered a “catastrophic” economic crisis after its banking system virtually collapsed — has a lower unemployment rate than Bermuda, coming in eighth with an unemployment rate of less than six per cent and is said to be making a “remarkable” recovery.

The report also stressed that islands need to reduce their reliance on one or two revenue generators and find new sources of income. And it said: “Of the islands analysed in the Monitor, Iceland and now Cyprus have experienced catastrophic financial crises.

“However, it is interesting to note that Iceland is staging a remarkable economic recovery. Other island communities are borrowing to meet public service costs.

“An example is Bermuda, which, for many decades, has enjoyed some of the strongest levels of economic performance of any island in the world.

“However the island is now in its fourth successive year of economic contraction which has led to high levels of unemployment and other social problems.”

But the report — in a nod to the OBA and Finance Minister Bob Richards’ promise to cut debt and boost income — added: “The Bermudian government is now being very proactive in its endeavours to address the decline.”

The report added: “One of the determining factors in an island’s economic life cycle is the ability of an island government to generate sufficient revenue not only to cover operating expenditure but also, and equally as important, how to allocated allocate funds for essential capital projects and for sustainable economic, social and environmental infrastructure initiatives which will benefit future generations.”

The report covers a total of 14 islands, which also includes Malta, Mauritius, and the Australian state of Tasmania.

It highlights the increasing use of Public Private Partnerships (PPP) as islands struggle to deal with costs — particularly in health services — as well as increased borrowing to cover a shortfall between income and expenditure.

And it singles out Malta and Mauritius as examples of islands where governments are spending to diversify their economic bases in the medium to long term.

And the report, prepared by Guernsey-based Island Analysts, warned: “External threats, such as tax transparency, regulation, internet shopping, competition from locations which can offer a cheaper labour supply and better market access are all increasing the pressure on islands to broaden their economic base.

“That in turn also requires an island government to have a broad balance of direct and indirect revenue sources so that there is less reliance on only one or two sources which could be adversely affected by a changing economic profile and performance.”

And the report added: “With the economic, social and political turbulence being experienced by various islands, and possibly still to be experienced by others, island jurisdictions have to remain fully abreast of challenges, potential solutions and initiatives being addressed by islands around the world.”

Mr Richards had not replied to requests for comment by press time. n