Survey reveals scepticism about economic recovery

Scepticism, thy name is Bermuda.

At least when it comes to a prospective economic recovery.

A new survey indicates that more than a third of Bermudians — 36 percent to be exact —  consider a swift economic recovery to be implausible for the next three years.

The results, culled from surveying 400 island residents between March 10 and March 21, indicated that 14 per cent  expect to see positive signs of economic recovery this year, a quarter of those polled expect to see such signs next year, while 20 percent expect  to see positive signs of economic recovery in 2016.

About 6 percent either did not know or did not answer.

Male residents are more optimistic about the near future than females,
according to the survey results. Residents in Pembroke and Devonshire are the most optimistic when compared to the other
parishes.

Peter Everson, an executive board member at the Bermuda Chamber of Commerce,  said he was not
surprised by the findings.

“For an economy to recover from a severe decline it is a long and difficult process,” he said through an email. 

He added: “People will have different views because they work, or want to work, in different areas of the economy and each entered into the recession at different times. If you take the view of a construction worker, they may see potential work arising from the building of new hotels and that may start this
winter and into 2015. An alternative view would be from someone who works in the hotel industry. 

“They will not see new job opportunities until the hotel construction is
complete.”

Craig Simmons, an economics lecturer at Bermuda College, said he disagrees with  the sample’s conclusion that the recovery is at least three years away.

“I’m reminded of the fact that pundits are often as wrong in their predictions as laymen or dart throwing chimps,” he said. “Most pundits think that the
recovery will start before the end of the year.”

The problem, according to Mr Simmons, is that an economic prediction is an example of what is known as a, “low validity environment.”

“Economic pundits don’t have the opportunity to practice their craft or to get feedback from their practices in the way that a doctor, a pianist or a chess player can,” he said. “None of us has experienced a deep recession and even if we did, that would only be a sample size of one — hardly enough practice to call oneself a competent.”

Wild differences in belief can often be chalked up to semantics, said Mr Simmons, such as what is exactly is meant by the term “recovery.”

“Surveys tend to measure people’s perceptions at a point in time, nothing more,” he said. “In five years time, when the recession becomes a distant memory, most people will remember it as ‘not-so-bad’ or as a time of needed correction from the excesses of the noughties.”

He added: “The skepticism over the recovery is the result of a band wagon effect or herd mentality — the tendency to believe things because many other people believe the same.  That’s exactly the kind of thinking that got us into the recession.”

TOTAL RESEARCH ASSOCIATES LTD. provided the Bermuda Sun with selected results from The Bermuda Omnibus©, a syndicated quarterly survey of public opinion. Running for more than 15 years, the Bermuda Omnibus© is conducted quarterly. Results are based on telephone interviews with a randomly selected sample of 400 Bermuda residents (18 years or older). Results are accurate to within plus or minus 4.9 per cent in 95 out of 100 samples. Contact Graham Redford, Managing Director, Total Research Associates Ltd., 295 4558 or email: [email protected]