The Bahamas Brain Drain

The Bahamas needs to improve its educational system to mitigate the brain drain and improve human capital

By Jamal Moss

Nassau, The Bahamas

Employment and Labor Market in The Bahamas

The challenges of Bahamian labor markets comprise various complex issues that affect the strength of its economy.  This article delves into three critical issues: brain drain in The Bahamas, wage employment of foreign workers to Bahamian workers in quality jobs, and measures to build up the middle class in the wake of taxation and inflation.

Thus, these issues are noted, and corresponding gradual commonsense changes are suggested, considering the nature of the Bahamian labor market and possible directions for its development.  First, I wish to focus on the brain drain problem affecting The Bahamas and offer incremental solutions.

Brain Drain in the Bahamas

The Bahamas faces the challenge of brain drain where educated and profound personnel migrate from the country to other developed countries where they are well rewarded.  The issue deprives the government of human capital, which is crucial in the country’s development process.  This situation is critical since high levels of unemployment, particularly among our youthful population, compel such brains to migrate in search of opportunities elsewhere.

The Bahamas has to promote educational opportunities, provide favorable working conditions, improve job procurement services, and encourage those who left to return home.  Our island nation has to retain talented people and attract gifted individuals necessary for the country’s development.

Every year, an average of 5000 students leave high school, and university graduates get to seek higher education in other countries.  Hence, there are not enough jobs or poorly paid according to their education level waiting for them.  The Bahamas should advance educational rights, demonstrate employers’ benevolence, and augment job assistance.  The Bahamas has to keep the human capital and draw skilled people, which is essential for the country's progress.

Incremental Solutions

The Bahamas needs to improve its educational system to mitigate the brain drain and improve human capital.  Financing in higher education institutions and vocational training centers will help provide quality education and training (The Nassau Guardian, 2023).

Having linkages with other institutions worldwide for exchange programs can help learners gain international benchmarks and retain talent by providing the best learning environment within their country.  Such an approach will enhance the quality of learning and place the Bahamian qualifications in parity with the international standards, making Bahamian graduates more marketable within and outside The Bahamas.

It is significant to establish a favorable working atmosphere.  Enhancing working conditions and pay will make local markets for jobs more appealing.

Bonuses such as medical coverage, pension and perks etc increase morale and, thus, worker retention.  This helps in enhancing The Bahamas government guarantee its professionals have access to such crucial benefits (Watson & Gustave, 2022).

By these possible commonsense solutions, The Bahamas can increase the attractiveness and support of its labor force so that it would not be tempted to work in another country.  Focusing on the staff’s growth and encouraging them to participate in various courses and seminars is beneficial and results in a more devoted and loyal human capital.

Another essential strategy is enhancing employment placement services.  Improving job placement and career counselling services will be necessary to match those graduating with appropriate jobs within the country.

People can use technological advancements to develop a central database for employment vacancies.  Encouraging Bahamians living in other countries to return home, tax relief, relocation allowance, and preferential employment would enhance recruiting qualified staff.

Other convincing cases regarding people becoming returnees may also encourage others to do the same, ultimately benefiting the country’s talent pool and overall progress.  We cannot continue to allow our young fresh minds to slip through our hands so easily like sand.  We must be intentional in fixing this leak. 

Source

Foreign Labour versus Bahamian Labour in The Commonwealth of The Bahamas - By Jamal Moss>>>

The Bahamas national unemployment rate increases

Unemployment up

Survey says more than 30,000 without jobs

By KRYSTEL ROLLE-BROWN
Guardian Staff Reporter
krystel@nasguard.com

The national unemployment rate rose from 14.3 percent in May 2014 to 15.7 percent in November 2014, according to preliminary results of the latest Labour Force Survey.

The survey, which has a reference period of October 27 to November 2, 2014, shows that both New Providence and Grand Bahama saw increases in unemployment.

In New Providence, the unemployment rate grew from 15 percent to 16 percent, and in Grand Bahama it increased from 14.7 to 18.6 percent. The Department of Statistics also conducted a survey in Abaco, which recorded an unemployment rate of 20.3 percent.

Cypreanna Winters, the statistician responsible for the Labour Force Survey, said the results of the survey, which covered a six-month period, indicate that the labor force increased by 1.8 percent since the last survey conducted in May 2014.

“The labor force now totals 201,040 persons,” she said during a press conference at the Department of Statistics.

“There was an increase in both the number of employed and unemployed persons; however, the growth in the number of unemployment persons exceeded that of the employed.”

As it relates to discouraged workers, the number decreased nationally from 4,880 in May to 4,560 in November.

“In New Providence, while there was an increase in the number of discouraged workers, 22 percent, the reverse is noted in Grand Bahama where there was a decrease of 55 percent,” Winters said.

Officials believe the increase in discouraged workers in New Providence is due in part to last year’s layoffs.

“You had persons who were laid off during the course of the year and they would have become despondent,” Director of Statistics Kelsie Dorsett said.

In Abaco, where the total labor force was 9,800 at the time of the survey, there was an estimated 320 discouraged workers.

According to the standard definition of the International Labour Organization, discouraged workers are not considered unemployed as they have stopped looking for work because they feel there are no jobs available.

The survey shows that 31,540 people were listed as unemployed –17,145 women and 14,395 men.

A breakdown of those statistics shows that 24,110 people were listed as unemployed in New Providence, 4,725 in Grand Bahama and 1,990 in Abaco.

The results also show that 81,900 women were listed as employed and 87,600 men were listed as employed, for a total of 169,500.

Of that number, 126,545 were employed in New Providence, 20,645 in Grand Bahama and 7,810 in Abaco.

Winters noted that the unemployment rate for people ages 15 to 24 continues to be considerably higher than any other age group.

Youth unemployment nationally stood at 31 percent in November compared to 28 percent in May 2014.

Officials have attributed the high rate of unemployment among young people over the years to a lack of experience when entering a competitive labor market.

Since May 2012, 8,850 net jobs were added to the economy.

The number of people employed in May 2012 was 160,650 compared to the 169,500 employed in November 2014, the survey shows.

January 10, 2015

thenassauguardian

...if the Bahamian economy were to grow at a level of six to eight percent ...we would not be talking about government debt... ...The reason why we should prioritize economic growth over debt reduction is because greater economic activity generates greater revenue for government... ...Greater revenue reduces reliance on borrowing and so, debt would fall over time... ...Further, higher levels of growth usually lead to lower levels of unemployment, more opportunities for individuals to make money in order to pay their mortgages, to pay for college, or to start new businesses... ...But, in order to achieve such levels of growth, we need a plan

A call for a national economic plan

By David Frazer

In the 1960s, Germany experienced one of the world’s most impressive examples of economic growth and development that raised the standard of living for the Germans exponentially.  Its success was due to a number of factors, not least of which was its ability to organize its industries, plan for the future and engage stakeholders at all levels in the work of economic growth.  If one posed the question today where is the economy of The Bahamas headed in the next five to 25 years, it would be difficult to provide a viable answer partly because of the lack of direction in state policy.

The recently published budget and budgets of past governments confirm this notion.  The 2012-2013 budget proposes short-term bandages on an economic wound that runs deep through society, addressing symptoms of a much larger structural problem.  It is now time to focus our energies and resources on a cure to our economic illness.  It is time for a national economic plan.

Highlights of the government’s 2012-2013 budget

• Expanding the role of the Bahamas Development Bank and the Bahamas Agricultural and Industrial Corporation to go beyond lending money to provide equity, credit guarantees and marketing/accounting support is a promising move to support small business and Bahamian entrepreneurship.

• Tax reform was four pronged.  The government will establish a central tax agency to improve its ability to collect taxes.  It will reform the property tax system including a cap on property taxes.  It will look to reducing leakages in the tax system and to charge international fees for aircraft passing through the country’s airspace.  This effort to raise government revenue is commendable but insufficient; the expected revenue which incorporates these ideas would still leave the country with a massive expenditure-revenue gap of nearly $300 million.

• A debt management committee will be developed to implement a debt management strategy.

• A plan to rescue Grand Bahama includes tax reduction and a Ministry of Grand Bahama.

• The jobs program of the previous government has not been continued.  Described by the current government as “lacking focus”, the jobs program attempted to alleviate the unemployment situation particularly for youth.  The problem is that the new government has not proposed an alternative to reducing youth unemployment.

• A mortgage relief effort aimed at reducing loan payments for distressed mortgage holders has received scathing international criticism.  Standard & Poor’s, a reputable rating agency, responded to the government’s promise to help mortgage holders by suggesting that the government may face lower credit ratings if it continues to spend more than it earns.

• Tax concessions laced the budget and there was an explicit promise not to raise taxes for Bahamians.  This combination of tax reduction and mortgage relief spending has cast doubt on the “government priority” to reduce national debt.

Let’s be smart about debt reduction: Focus on growth

Given the extent of the global economic recession, the government has been forced to play a greater role in economic activity.  As in the United States, government spending grew to supplant the lost economic activity after the recession.  While we must reduce the level of government debt, we must be careful not to damage the economy while doing so.  One can look to Europe for an example of how austerity soon after a recession can be detrimental to economic growth.

At the same time, government must not be frivolous in its spending.  Promises in the budget to help individuals make home repairs on top of aforementioned mortgage relief may be politically successful but do not spur further economic growth.

We hope that political leaders will go through the budget, line by line, and re-allocate/reduce unnecessary expenditure.  As much as is possible, government spending should be guided by the principle that every dollar spent directly increases the Bahamian GDP by more than a dollar and/or increases productivity.  Under this principle, unnecessary spending may be brought to light.

Hypothetically speaking, if the Bahamian economy were to grow at a level of six to eight percent, we would not be talking about government debt.  The reason why we should prioritize economic growth over debt reduction is because greater economic activity generates greater revenue for government.  Greater revenue reduces reliance on borrowing and so, debt would fall over time.  Further, higher levels of growth usually lead to lower levels of unemployment, more opportunities for individuals to make money in order to pay their mortgages, to pay for college, or to start new businesses.   But, in order to achieve such levels of growth, we need a plan.

The need for a national economic plan

Just over 26,000 Bahamians searching for work are unable to find it; thousands more have given up and left the labor force; unimpressive growth levels in the U.S. may dampen growth of tourist arrivals in the foreseeable future, and our own growth projection is stifled at less than three percent for the next few years.  These facts underscore a structural issue in the economy.  In essence, overreliance on tourism has limited the scope of economic growth.  We have failed to use the resources tourism has afforded us to develop other industries as a means to secure future growth.

We should get the largest stakeholders and experts in one room – business leaders, academics, government officials and local/international investors – to search for and implement a national economic plan with an aim to secure high levels of growth into the future.  Such a plan should be medium to long-term in focus and grounded in rigorous research on the potential for local business expansion, export of Bahamian franchises, products and services, and diversification within and across industries.

A plan of such magnitude is important because it provides an industrial framework for growth and will provide a sense of security for local business owners who would be able to plan the development of their own enterprises as a result.  A plan could create a momentum for the growth of certain projects and industries.  Finally, it would enable government to plan other areas of society such as new education and training initiatives, infrastructural projects and immigration policies that correspond with the national plan.

Our current economic realities call on us to make big decisions to secure a prosperous future.  Let us plan our way to economic vitality and growth.

 

• David Geraldo Frazer is a master’s degree candidate at Johns Hopkins University studying international economics and international relations with a bachelor’s degree in economics and business.  He is also a free lance consultant and can be contacted at: dfrazer1@johnhopkins.edu

Jun 13, 2012

thenassauguardian

Caribbean Blog International

...four years after the ‘Great Recession’ commenced, the Bahamian economy continues to struggle... ...the government is challenged with reduced revenues, soaring energy and food prices, high unemployment, rising crime levels and social ills... ...with unemployment at its highest in years and individuals on reduced pay... it seems fair to state that the mortgage sector and housing market in The Bahamas are in a crisis...

Confronting the Bahamian debt crisis pt. 1

By Arinthia S. Komolafe

In the aftermath of the worst recession since the Great Depression, the government is challenged with reduced revenues, soaring energy and food prices, high unemployment, rising crime levels and social ills.  In response to these challenges and in order to stay afloat, the government has resorted to borrowing.  The reality is that imprudent borrowing practices prior to and during the economic downtown have exacerbated the economic soundness of our government.

The story of the sub-prime mortgage crisis and the lessons learned are well documented.  However, four years after the ‘Great Recession’ commenced, the Bahamian economy continues to struggle.  It was reported that the Bahamian banking system was resilient to the crisis and to some extent the economic downturn because of our credit policies as administered by the Central Bank of The Bahamas (CBB).  However, was this assertion truth or fallacy?  One wonders if based upon the facts and looking back in hindsight whether the current mortgage and ultimately debt crisis was an accident waiting to happen.  Could it be that the economic downturn exposed flaws in our monetary policy and credit risk management framework?

Background

A journey down memory lane and history, will show that the CBB in August 2004 in an attempt to ensure that credit expansion was consistent with economic growth, advised banks to monitor borrowers’ creditworthiness by limiting the debt service ratio (DSR) on loans to a range of 40 percent to 45 percent of ordinary income and require a minimum of 15 percent equity contribution on all personal loans with exceptions to those secured with mortgage indemnity insurance.  A short one month later, the CBB temporarily relaxed those policies by eliminating the 15 percent equity requirement and raised the DSR threshold to 55 percent.  It is noteworthy to state that the reason given for this change was to aid in relief due to the effects of Hurricane Frances.  It is unclear, however, how many banks took advantage of this flexibility, the immediate impact on the economy and how long these policies actually remained in effect.

However, some four months later, the CBB reduced its discount rate (DR) from 5.75 percent to 5.25 percent and the prime rate (PR) was consequently reduced by 50 basis points to 5.5 percent.  It is imperative that we examine the aforementioned policy decisions made by the CBB in the context of the Bahamian economy which is primarily consumer driven.

In the absence of an established credit bureau, it is difficult to assess the creditworthiness of Bahamian consumers and almost impossible to assess whether a consumer’s DSR truly falls within the 40 percent to 45 percent range.  Taking a conservative hypothetical approach (and I must emphasize that this may be extremely conservative) and assuming that a majority of consumers had a ‘real’ maximum DSR of 55 percent as opposed to the required maximum 45 percent, it follows that an increase of the DSR to 55 percent would increase the ‘real’ DSR to 65 percent, leaving the consumer with an ultimate disposable income rate of only 35 percent.

In addition to the scenario painted above, a decrease in the DR and PR all things being equal, should further encourage borrowing and expand credit.  This brings into question whether the objective of ensuring that credit expansion was consistent with economic growth was achieved.  In 2004, with the CBB’s policy to restrict credit expansion, the amount of mortgages for new construction of single dwelling homes stood at a mere 894.  To highlight the effect the aforementioned policy change had on the mortgage market, in 2005 and 2006 government revenue on stamp tax for mortgages almost doubled in 2005 compared to 2004 and increased significantly in 2006.

Further, residential mortgages for new construction of single dwelling homes stood at 1,428 and 1,137 in 2005 and 2006 respectively.  The total processed value amounted to approximately $300 million for these years.  It is uncertain how many persons painted a true picture of their DSR and the real question is whether the majority of persons who obtained mortgages during this period should have actually qualified for those mortgages. This is bearing in mind that as at December 31, 2011 mortgage delinquencies stood at approximately $650 million.

Mortgage sector and housing market in crisis

Today with unemployment at its highest in years and individuals on reduced pay, it seems fair to state that the mortgage sector and housing market are in a crisis.  It is not surprising that many Bahamians have defaulted on their mortgage obligations with mortgage delinquencies standing at approximately $650 million in arrears for the entire Bahamas.  In order to appreciate the extent of this debacle, a look in the newspapers will reveal a fraction of the number of foreclosed properties advertised for sale.  It has been argued that the reduction of the DR and PR by 75 basis points in June 2011, although welcomed came too late and that the reduction was inadequate.

The government is being called upon to provide mortgage assistance for those who are losing their homes.  Proponents of this relief effort cite the millions of dollars expended on capital infrastructure by the government in justifying this move as the right action required.  They submit that if the government could spend such exorbitant amounts on infrastructure and the purchase of shares, it is only fair that the government would provide relief to struggling homeowners.  Opponents of any form of mortgage relief efforts by the government argue that in a capitalistic society, the government should not interfere with private enterprise.  After all, opponents submit the free market economy is designed to have minimal government intervention and market forces must be left to control the market.

In the final analysis, there is enough blame to go around; starting with the government, the lending institutions and the consumer.  In the years leading up to the financial and economic downturn, the government benefitted from the credit expansion as a result of monetary policy in the form of increased stamp tax revenue, the lending institutions turned over record profits and consumers benefitted from unprecedented access to credit facilities.

It is only fitting, therefore, that the aforementioned benefactors should come together to bring resolution to this crisis.  In order to avoid further deepening of this crisis, the government on its part, should explore establishing a fund to assist eligible homeowners in retaining their homes.  Adjustments to the DR and PR by the CBB should be stalled until a credit bureau and robust consumer protection agency as a matter of urgency have been established.  The lending institutions should take significant steps to refinance mortgages on more favorable terms for consumers and more importantly consumers should exercise increased prudence in the management of their finances.

 

•Arinthia S. Komolafe is an attorney-at-law.  Comments can be directed at: arinthia.komolafe@komolafelaw.com

Confronting the Bahamian debt crisis pt. 2

Mar 09, 2012

thenassauguardian

caribbean Blog International

Youth unemployment, which is pegged at 34 percent in The Bahamas, is especially a cause for concern if only because many of the young people have not yet had the opportunity to join the labor force... and as such, are being denied access to gainful employment... which is considered by many social scientists as the traditional route to the process of social integration

Youth unemployment

thenassauguardian editorial

The most recent Labour Force Survey, which was released by the Department of Statistics, contained some insightful but at the same time alarming information on the current state of unemployment in The Bahamas.


Apart from the distressingly high unemployment rate of nearly 16 percent overall and the continuing challenges to the Grand Bahamian economy, with an unemployment rate of 21.2 percent, the data on youth unemployment is perhaps the most disturbing.


Youth unemployment, which is pegged at 34 percent, is especially a cause for concern if only because many of the young people have not yet had the opportunity to join the labor force and as such, are being denied access to gainful employment which is considered by many social scientists as the traditional route to the process of social integration.


High youth unemployment is not peculiar to The Bahamas; indeed it is now recognized as a global phenomenon which is adversely impacting both developed and developing economies. Several studies on the subject have suggested that prolonged periods of unemployment among young people tend to lead to a reduction in self-esteem, diminished levels of well-being and a sense of isolation from peer groups.


Over time, youth unemployment could become problematic to the larger society since young people without the means to provide for their basic needs may not only engage in anti-social behavior, they may withdraw entirely from the labor force and by so doing, further reduce the future developmental potential of the economy.


The marginalization and social exclusion of the youth, according to some studies, are even more pronounced during a recession in that young workers are usually the first to be laid off or downsized when firms begin cost-cutting exercises. And those who remain in the labor force are disproportionately represented in the'informal'sector where they have no formal contract of employment, no guarantee of regular work and in some instances, little or no rights under labor laws. The more educated among the youth are often forced to'trade down'or accept employment far below their qualifications, and for the most part, that group is underemployed and often becomes resentful of the society or the environment in which they find themselves.


Many countries, both developing and developed have attempted to address the problem in a variety of ways including providing direct incentives to labor intensive sectors and/or establishing schemes to promote self-employment.


Both initiatives, although useful, are not the solution in isolation and ought to be part of a more comprehensive youth employment strategy which has at the centerpiece, sustained macro-economic growth for the entire economy.


To be sure, the self-employment initiative pre-supposes a widespread possession of the entrepreneurial spirit and acumen which clearly is not present in everyone, nor is it something that can be taught. It has to be recognized that the future growth and development of any society is dependent on the efficiency with which it employs its factors of production: land, capital, labor and entrepreneurial know-how. Of all the factors, it is labor that has to be continuously introduced, engaged, trained and developed at an early stage in order to be most productive.


In other words, we have to regard our youth as an asset that has to be fully integrated into the productive process and good public policy demands that young people be given priority. According to the United Nations, instead of seeing them as tomorrow's leaders, we ought to regard them as today's partners.

Feb 25, 2012

thenassauguardian editorial

Caribbean Blog International

...youth unemployment is up by more than 30 per cent in The Bahamas

Jobless youth up by a third


By SANCHESKA BROWN
Tribune Staff Reporter
sbrown@tribunemedia.net


THE NATIONAL unemployment rate has risen 2.2 per cent in five months and youth unemployment is up by more than 30 per cent, according to the latest labour survey released by the Department of Statistics yesterday.

The survey, which was conducted in November of last year, shows increases in both New Providence and Grand Bahama, pushing the country's unemployment rate to 15.9 per cent.

In the case of New Providence, the rate increased from 13.2 per cent to 15.1 per cent and in Grand Bahama from 15.4 per cent to 21. 2 per cent.

The last labour force survey was conducted in May of 2011.

Kelsie Dorsett, director of the Department of Statistics, attributed the 2.2 per cent increase in the unemployment rate to a decline in the informal sector and a larger number of young people becoming unemployed.

She said :" The data survey from May showed a number of person sought employment by engaging in informal sector activities. These people, like fruit sellers and phone card vendors, saw their businesses fail a few months later. When that happened they withdrew themselves from the labour force and joined the ranks of the unemployed causing an increase."

In addition to a reduction in the number of persons engaged in the informal sector, which declined by 19 per cent, there was also a decline in the number of self-employed persons. In May, self-employed persons accounted for 14 per cent of the total employment, but in the latest November survey that number decreased to 12 per cent.

Mrs Dorsett said a 34 per cent increase in the number of unemployed young people also contributed to a rise in the unemployment rate.

"In May when the earlier survey was conducted, most students about to graduate from high school and university were unlikely a part of the labour force, however, in November though some of them may have obtained jobs, others were likely awaiting responses from their job applications," she said.

"Also the young people that were working, when businesses started to fail, were the first ones to be let go or laid off. Its usually the last one in that's the first one out and in most cases its the young people who fall in that category."

Mrs Dorsett said this is a trend that will be monitored now that the survey is conducted biannually - in May and November.

New Providence experienced a decline of 13 per cent in the number of discouraged workers while the reverse was the case in Grand Bahama where the numbers increased by 42 per cent.

Mrs Dorsett said that in May Grand Bahamians were more optimistic about finding work but that their attitudes changed in November after months of searching for jobs with no success.
The survey also showed a slight increase - less than one per cent - in the size of the labour force which is now 190,445 persons.

The number of women declined by 1.4 per cent while the number of working men increased by 1.8 per cent.

In New Providence the number of persons in both the labour force and the employed labour force was almost equally distributed among the sexes. In Grand Bahama however, men outnumbered women in both the labour force and the employed labour force and were fewer in numbers among the unemployed.

Mrs Dorsett said the next labour force survey to include some of the Family Islands will be conducted in May 2012.

She said this particular survey will use a more detailed questionnaire, which will allow for the collection of data on the informal sector, training and similar information.

Additionally, a condensed questionnaire will be used with the major focus being the measurement of the labour force and the relevant indicators - participation rate, unemployment rate, and the like.

February 08, 2012

tribune242

caribbean Blog International

The Department of Immigration has decreased the number of work permits issued in 2011 by 24 per cent due to the high level of unemployment among Bahamians

Cut in work permits to help Bahamians


By SANCHESKA BROWN
Tribune News Reporter
sbrown@tribunemedia.net



BECAUSE of the high level of unemployment, the Department of Immigration decreased the number of work permits issued in 2011 by 24 per cent, Deputy Prime Minister and Minister of Immigration Brent Symonette said yesterday.

From January 1 to December 31, 2011, the Department of Immigration issued 7,091 work permits, 2,299 less than the 9,390 issued in 2010 and 1,025 less than 2009.

Mr Symonette revealed these statistics while answering questions posed to him by Opposition members in the House of Assembly.

"We are putting Bahamians first," Mr Symonette said.

"We are not issuing permits to foreigners for jobs Bahamians can do. The department has tightened its level of scrutiny on work permit applications and as a consequence 2,299 fewer permits were issued in 2011 than in 2010. Another reason for the decrease is a lot of the companies that were in the Bahamas are no longer here so their employees went with them. To say the economic downturn is the only reason is not entirely correct but it is one of the main reasons."

Of the 7,091 work permits issued last year 53 per cent or 3,793 were given to housekeepers and handymen - 1,671 and 2,122 respectively.

Mr Symonette said the reason for the high numbers is because Bahamians simply "don't want the jobs."

"More than half of the work permits went to non-skilled labour. Bahamians complain about the number of work permits we issue and the unemployment rate however they refuse to do the jobs. They think its menial and beneath them and they just won't do it. Well, you can't have your cake and eat it too," he said.

"A lot of Bahamian households have Jamaican maids and because Bahamian women rather apply to work in the hotel as housekeepers than in a home. Then you have a large category of Peruvian and Filipino live ins. These people require work permits. You have a large number of Haitian gardeners. I know one man who has had his work permit renewed 20 times because Bahamians just won't do the work."

Work permits for construction workers decreased by 53 per cent, from 565 in 2010 to 291 in 2011. Farm labourers also decreased significantly from 549 to 441. In fact, of the 24 categories of jobs that foreigners were granted work permits in 2011 all but eight saw decreases compared to the same period in 2010.

The categories where increases were seen are listed as follows:

* Cooks: 141 - 145

* Consultants: 51 - 89

* Guest Organisers: 49 - 64

* Maintenance Men: 49 - 59

* Presidents: 0 - 3

* Projects Mangers: 43 - 57

* Surveyors: 25-31

* Attorneys: 0 - 4

Mr Symonette said the government expects more declines in the issuance of voters cards with the introduction of the new training programme, which is designed to provide more Bahamians with skills for jobs now being done by non Bahamians.

Of the 7,091 work permits issued last year. 5,958 were issued on new tamper proof, electronic cards.

February 07, 2012

tribune242

Caribbean Blog International

Continuing budget deficits and the national debt... Bahamas

The mid-term budget
thenassauguardian editorial




The prime minister and minister of finance has presented to Parliament a statement on the fiscal affairs of the country for the six month period ending 31st December, 2010. It seems clear that the country is still being severely challenged on the fiscal front and the economy has yet to emerge from the depths of the global recession.

The most important budgetary item, total revenue, is trailing estimates by $50 million despite the tax hikes and the improved revenue administration announced at the start of this current budgetary cycle.

That outcome is not surprising when one considers that in our economy, our major source of government revenue is customs duties, which are determined by the level of imports, which in turn is determined by employment levels and tourists arrivals.

Unemployment is in the mid-teens, according to the latest available figures which have not been released since 2009, and air-arrivals — the most important tourist category — is seemingly stagnant at 1.3 million; a figure that has hardly changed in two decades.

From a policy perspective, it seems clear that efforts to boost tourist arrivals (by air) and at the same time expand employment opportunities are of critical importance going forward.

Although the budget statement gave a hint of cautious optimism regarding the outlook for economic growth and development over the short term, it is difficult to overlook the ominous threat to that growth also contained in the statement in reference to the almost 24 percent increase in gas prices at the pump and the 37 percent increase in the surcharge applied by B.E.C. to our electricity bills.

It would appear that the consumer, who continues to buckle under the more than $1 billion in loan arrears at the bank (mostly in mortgages), will continue to face serious financial challenges for the rest of the year.

The mid-term budget permits, among other things, for Parliament to approve by way of a supplementary expenditure Bill any additional funding that is needed for specific line items in the original budget. In this exercise, an additional $10 million was needed for the e-government initiative; $18 million is earmarked for payment to the utility companies; nearly $4 million for the police; and another $4 million for medicine.

On the Capital Budget side, $5 million went to Broadcasting Corporation and some $8.8 million to the Water and Sewerage Corporation. These cost-over runs are partially offset by under-spending on other items.

What is somewhat surprising about the listing, however, is the absence of any additional funding for Bahamasair, which is usually at the head of the line when it comes to government hand-outs. The expenditure items, both recurrent and capital, are largely within the estimates which were earlier approved by Parliament and given the fixed nature of the major items, Personnel Emoluments (wages, salaries, gratuities and pensions) that is not surprising but it is cause for concern in the face of sluggish revenue performance and the historical stance taken by successive governments not to make any major adjustments to staff levels in the public services sector.

The combination of sluggish revenue performance and rigid expenditure levels, which have become hallmarks of government’s budgets, could only lead to continuing deficits; deficits which are invariably financed by further additions to the national debt, which at an unprecedented 56% of GDP, is approaching a threshold that should be of paramount concern to all of us, especially the younger generation who no doubt would have to pay it off sometime in the future.

2/24/2011

thenassauguardian editorial

Bahamas Blog International

Bahamas Upcoming General Election: It’s [Still] the Economy Stupid!

“It’s [Still] the Economy...”
By Felix Bethel
jonesbahamas



Well might it be as true today as it was some years ago in the United States, “...It’s The Economy, Stupid...”

As we now recall – and quite vividly so - "It's the economy, stupid" was a phrase in American politics widely used during Bill Clinton’s successful 1992 campaign against George W. Bush.

[As we recall] For a time, Bush was considered unbeatable because of foreign policy developments such as the end of the Cold War and the Persian Gulf War. The phrase, made popular by Clinton campaign strategist James Carville, refers to the notion that Clinton was a better choice. And so it seemed to be, Clinton was victorious.

While the times might have changed, the principle inherent in slogan remains.

Indeed, as we look at what passes for political debate in our country; particularly as that ‘debate’ is played out in media and in the House of Assembly, the fact remains, that“...It’s The Economy, Stupid...”

Whether the reference made has to do with Baha Mar and its fate; the public debt – or the level of unemployment and its attendant Misery Index, the fact remains that this conversation is all about the economy.

Evidently, therefore, we can and will extrapolate that –as night follows day – the next general elections will be hard fought; that the outcome of the contest in question will necessarily hinge on what is happening in and on the national economy.

Our current surmise is that this contest will take place –as it were – in the very heart of the nation’s political ring – as each and every candidate fights for a space in the heart of the nation’s electorate.
Here we are suggesting that, precisely because the Great Recession will still be a fact of life, the working poor will have one superlative moment to bend reality in their favor.

Evidently, those who come looking for votes need understand –even now – that they had better come looking better and talking better than they have done heretofore.

We would also suggest that, no matter the name or fame of the party that ultimately prevails; those who come to office in the aftermath of the next general elections should understand that, they will face an unprecedented set of challenges.

As such, therefore, they should know and respect as fact that the road ahead will be especially hard for any and all Bahamians who are not prepared to do more for themselves.

In addition, no matter the name or fame of the party that ultimately prevails in the aftermath of the next general elections; the public is today thoroughly disenchanted with a politics where tribalism and cronyism are seen to pervade things.

And so, while we take it for granted that, the most important sources of economic growth over the medium to long term are likely to be the tourism industry, financial services sector, transshipment services, and other services; we are also persuaded that Bahamians should be actively encouraged and supported when they seek to play large roles in these industries.

Yet again, this principle is grounded in the notion that, "It's the economy, stupid."

Take note that when we recite this pithy piece of political wisdom; we note that reference to the economy and its myriad of implications for the well-being of the Bahamian people, the notion ‘economy’ must be so re-configured that the term “economy” is used to cover the relationships the Bahamas has with its neighbors, the United States of America – and the world far away as in the case of Brazil, Russia, India and China; among other such rising powers.

But, indeed, as America goes, so goes the Bahamas.

So today, it is a fact that, as one order of things ends; and as another is set to be birthed; the Bahamian people and their Caribbean counterparts are set to be called upon to revise some of their accustomed ways of making money.

They may well have no choice but to venture further and further from home, sweet home.

Evidently, these prospects reflect some of the realities of their current relations with a United States where the world-spanning capitalist system is itself currently mired in one of its periodic crises; thus much of the distress now being experienced at all levels in our Bahamas and throughout the region.

By necessary extrapolation and on the basis of sheer logic [and no matter how the proverbial cookie crumbles; it turns out to be quite true that, "It's [still] the economy, stupid."

While we seem to be citing the obvious, there is every reason to believe that, there are still some Bahamians who need to be disabused of the notion that, money can somehow or the other conjure itself up.

When all is said and done; it is only purposeful work that can make any real difference in the life of a people concerned with nation-building.

jonesbahamas

Bahamas Blog International

James Smith - former minister of state for finance says: Any news about the US economy slowing down is really not good news for The Bahamas

More economic woes for The Bahamas predicted
By ALISON LOWE
Tribune Staff Reporter
alowe@tribunemedia.net:


A FORMER minister of state for finance and local business people yesterday expressed concern about the possibility of a “double dip” recession in the United States further prolonging the economic woes of The Bahamas.

Their comments came on the heels of the latest report on Gross Domestic Product, the output of goods and services that indicates the performance of an economy, in The Bahamas’ main tourist market, the United States.

The report showed that the US economic recovery is losing steam, with GDP growth slowing quite markedly in the second quarter of the year, to 2.4 per cent, in comparison to the average 4.4 per cent rate recorded over the past six months, and the greater 3.7 per cent pace recorded for the first quarter of the year.

The slowdown was attributed to what former minister of state for finance James Smith called a key factor for The Bahamas - a fall in the rate of growth in spending by US consumers, from 1.9 per cent in the first quarter to 1.6 per cent in the March to June period.

Even as people in the US continue to suffer from higher unemployment, lower household wealth linked to a decline in the value of stocks and housing, tighter credit lending conditions and the need to reduce debt and bolster savings, many US commentators expressed surprise at the consumer spending figures.

While some international economists said they did not believe the new economic figures suggested the likelihood of a further outright contraction in the US economy - a “double dip recession” - some see this on the horizon. Others suggest that if not a further recession, there remains the potential for an even greater slowdown in the economic growth rate in the United States as the year continues, with all of the implications that will have for The Bahamas in terms of a stagnation or even a further drop off in the visitor arrivals that feed the local economy.

Mr Smith said: “Any news about the US economy slowing down is really not good news for us because it prolongs our recovery but the really important numbers in there relate to consumer spending and consumer confidence. Those really affect The Bahamas and so if they are down that is really not good news for us.

“We need not to hope not just for a recovery in the US but in terms of how the US consumer perceives himself against the economy,” said Mr Smith, also chairman of investment and financial services company, CFAL.

He said that even if the growth rate does not drop any further, the decline that has been registered in the US in this quarter will be felt in The Bahamas.

“I think it does have very serious implications for us,” said Mr Smith. “It would be a delayed affect because one begins to make travel plans three, six months in advance, so someone who intends to come here this winter may cancel that or forego it even if you have fourth quarter (economic) growth.”

Meanwhile, Mr Smith noted that The Bahamian economy is facing its own issues going forward as local businesses deal with the widely-publicised increases in a number of taxes within the 2010/2011 budget.

“The budget was crafted against certain realities like growing debt and unemployment and an attempt to reduce the deficit. That would be in right direction except in my view it was too much ... I think a lower dose over longer period of time might have been the better option,” said Mr Smith of the budgetary measures introduced by the Government in July and their potential impact on Bahamian economic activity.

Chamber of Commerce President Khaalis Rolle told The Tribune that he views the latest figures coming out of the US as a “real concern” for The Bahamas.

“I keep saying you need almost simultaneously both consumer confidence and investor confidence to come back to get this economy back on track. Investor confidence fuels jobs, consumer confidence is fuelled by the prospect of employment and there hasn’t been any major indicator to suggest they were coming back strongly,” said Mr Rolle.

Given that the majority of The Bahamas visitors from the US are “middle class Americans” who usually save or borrow to go on vacation, Mr Rolle said he sees the potential for “our (tourism) numbers to begin to be impacted again” based on the latest economic indicators coming out of the US - yet another reason, he added, to diversify the Bahamian economy away from its dependence on the US tourist market.

Meanwhile, speaking of a potential double dip recession, Mr Rolle said: “The second time round usually isn’t as bad because people won’t react with level of panic they did when crisis first hit.

“We saw at the beginning of the crisis how all of major resorts started to lay off people so if there is a double dip recession it may not be as hard as initial hit can guarantee you there will be some impact.”

A Government economic source, speaking off the record, said that in his opinion the figures do not likely herald another recession but just another indicator that the US economic recovery, and hence The Bahamas, is going to be slow and protracted in comparison to others historically.

He added that it may be too early to say if the economic figures presage a further recession, as they only represent economic activity in one quarter of the year.

“On the path to recovery there are many ups and downs. The key thing to realise is the reality is what you had is a financial collapse. In 2001 the recession lasted six or nine months, so you’re looking at least a year or two longer than that,” he suggested.

Asked whether in his view the 2010/2011 Budget was crafted with the potential for a double dip recession in the US in mind, the source said: “I think the budget reflects fact that the recovery period is uncertain, it’s a move towards fiscal consolidation.”

August 03, 2010

tribune242

Bahamas Blog

Brent Symonette - Minister of Immigration: Bahamians "cannot continue to employ non-Bahamian labour and complain at the rate of unemployment."

Deputy PM: we cannot employ non-Bahamian labour and complain about unemployment
By ALISON LOWE
Tribune Staff Reporter
alowe@tribunemedia.net:



BAHAMIANS should take a hard look at the realities behind the immigration of foreigners into their country and accept that their own behaviour and choices sometimes play a part in the situation about which many complain, the Deputy Prime Minister suggested.

Deputy Prime Minister and Minister of Immigration, Brent Symonette, said that Bahamians "cannot continue to employ non-Bahamian labour and complain at the rate of unemployment."

"We either have to accept that there are certain jobs Bahamians are unwilling, unable or are not being suitably paid to do or else we have to move on," he said.

"A Bahamian will work in a hotel, but yet we're importing maids to work in private homes. What's the difference between them? Why are we prepared to do one and not the other?" asked the Minister and MP for St Anne's.

Under Bahamian immigration law, a foreign person can get a work permit from the Department of Immigration to fill a job in the Bahamas if no suitably qualified Bahamian can be found to do the job. In some cases, this may mean those who apply for the job are not necessarily holding the skills or qualifications the position demands, and in others, foreigners are able to gain legal authorisation to work in The Bahamas when no Bahamians actually apply for certain jobs when they are advertised.

He suggested that not only does the level of foreigners employed to do these jobs in The Bahamas mean some Bahamians remain unemployed while jobs exist that they could do, but "you have to ask the question what other burdens do (immigrants) put on the system."

Meanwhile, Mr Symonette said there has been a "gradually growing" number of cases of suspected sham marriages between Bahamians and foreigners seeking "papers" in The Bahamas - primarily Haitians and Jamaicans.

"A number of persons of non-Bahamian citizenship come to the Bahamas, overstay their welcome, when caught get deported and coincidentally marry a Bahamian the next day in a country south of us then come back as the spouse of a Bahamian. The cases are far too common to be real. And that's an issue we all have to face. There are a number of marriages that we question," said Mr Symonette.

He said that where the Immigration Department suspects that a marriage is one of "convenience", lacking authenticity, it has denied the right to the usual work and residency related benefits that extend to the spouses of Bahamians and some fraudulent cases have been prosecuted. However, he added that the situation is a tricky one as the government must extend these benefits to the spouses of Bahamians or else face the likelihood that Bahamians who go abroad and marry will not return home. Referring to the employment of foreigners, mainly Haitians and Jamaicans, in relatively unskilled jobs such as housekeeping and gardening -- thousands of permits are approved each year for foreigners to work in posts like these when Bahamians cannot be found to do the work -- and the fact that there is "on a daily basis a demand for skilled labour at the Department of Labour." Mr Symonette said the Bahamas needs to "start looking at the whole immigration policy in this country."

"Do we have enough skilled labour in the Bahamas or don't we have enough? Are people applying for work permits with job descriptions that don't necessarily fit the job in hand? These are issues I think we need to get out for public discussion," said Mr Symonette.

June 16, 2010

tribune242

Bahamas Blog International

Bahamas Government Debt To Worsen

GOVT DEBT TO WORSEN
By CANDIA DAMES ~ Guardian News Editor ~ candia@nasguard.com:


A rising government deficit and persistent revenue vulnerability will continue to drive government debt up in the near future, according to international credit rating agency Standard & Poor's, which says in a report that government debt as a percentage of gross domestic product (GDP) will climb to more than 50 percent by next year.

The report fleshes out the details of the agency's initial assessment of the Bahamian economy and the fiscal and monetary conditions revealed late in 2009.

While the expanded report points to increasing debt levels — as did the initial assessment — all the news is not so gloomy.

As it regards unemployment, the agency projects that joblessness will drop from 14.5 percent this year to 12 percent next year. A further decline to 10 percent is projected in 2012.

But S&P said foreign direct investments will slow further this year, and it repeated previous projections that the economy will likely decline by 0.5 percent in 2010 and grow in 2011 for the first time in three years. The growth next year is expected to be 2 percent.

While debt levels are projected to remain pressured in the immediate future, the agency made the point that current government debt levels temporarily provide some space for fiscal weakening compared to similarly rated countries. Compared to many of its peers, The Bahamas' debt levels are in a favorable position, the report noted.

"We project debt levels to rise, but domestic markets will provide most of the financing," said S&P.

The agency projects that general government debt — which stood at 32.8 percent in 2006 — will climb to 49.5 percent this year, move up to 51.9 percent next year and increase further to 52.4 percent in 2012.

Minister of State for Finance Zhivargo Laing noted last night that the new report provides a more comprehensive story on what had been published by Standard & Poor's late last year.

Regarding the debt projections, Laing said the government will be able to comment more fully on what its views are on where the country will likely be when the budget communication is presented next month.

Asked whether there is cause for concern as it regards debt levels, he said, "Any sound fiscal management program rests on wanting to control debt to the extent possible. In fact, nobody would borrow if they didn't have to, but where it is necessary it has been a part of the government's fiscal program for some time.

"In an extraordinary economic climate there's some extraordinary borrowing. We now have weathered the worst of it so we're now seeking to return to levels of borrowing and deficit spending that are more in keeping with what has been our objective in times past. So to the extent that we have no difficulty servicing our debt there is no concern. To the extent that we want to ensure that we don't continue to grow the debt to a place where that could be a problem one is always concerned to do that."

According to the report, the general government deficit rose sharply and likely will average 4.7 percent of GDP in fiscal year 2009/2010 and 2010/2011. General government deficits averaged 1.4 percent of GDP from 2000 to 2007.

The report explained that increased spending against a narrow revenue base, which has declined amid the economic recession, led to larger deficits.

S&P said the higher deficits reflect government policy to alleviate the social impact of the economic recession and to support growth. The report points to the government's unemployment benefit program, the temporary jobs program and accelerated capital works projects.

The agency said, "Deficit financing comes predominantly from domestic sources, a credit strength for The Bahamas. The structure of the debt remains favorable, though it has recently relied more on foreign debt. Domestic debt accounted for 90 percent of total debt in 2007, which declined slightly to 88 percent in 2008 and further to 80 percent in 2009."

S&P pointed out that the government had hoped to receive between US$200 million and US$300 million in proceeds from the sale of a 51 percent stake in the Bahamas Telecommunications Company in the first half of 2010 to alleviate financing needs.

"However, the government has once again postponed the privatization following seemingly disappointment with the bids and prices offered at the end of 2009," the report said.

The ratings agency said it expects foreign direct investments (FDI) to remain low in 2010.

"FDI totaled US$600 million during the first nine months of 2009, compared with US$1 billion in full-year 2008," S&P said. "We expect FDI to slow further in 2010 as tourism projects progress slowly."

The report said FDI projects that appear to have staying power are those that eventually will serve high-end customers or a niche group of tourists, as well as those that will provide residential tourism products.

The agency said, "Once buoyant prospects for a major expansion of tourism projects, totaling more than US$10 billion over the next five to 10 years, are more subdued."

In the report S&P repeats a controversial statement it made in a previous report.

It said, "After posting real GDP growth of 5.7 percent in 2005, momentum slowed sharply and then the economy contracted. In 2007, the increase in real GDP was a mere 0.7 percent as growth was interrupted, first by the elections and then by the new administration's protracted period of reviewing contracts after it came into office in May 2007.

"The review of $80 million worth of contracts and the eventual cancellation of a $23 million public contract for the straw market negatively affected investor sentiment and brought substantial disruption to the contracts' activity."

It noted that the straw market project did not move back on track until December 2009, when the government signed a construction contract.

As noted in its summary release at the end of 2009, the agency placed The Bahamas' sovereign credit rating at BBB+/Stable/A-2. This compares to the A-/Negative/A-2 rating it gave in November 2008.

Regarding the December 2009 rating, S&P said, "The stable outlook reflects Standard & Poor's expectation that the government will gradually reduce its fiscal deficit and will maintain a generally stable external financing profile. We do not expect The Bahamas' tourism product to improve sharply until the U.S. economic (and U.S. consumer) recovery has consolidated."

April 30, 2010

thenassauguardian

Bahamas Blog International

PLP Deputy Leader Philip "Brave" Davis claims Prime Minister Hubert Ingraham's appointing of political figures to bench undermining crime fight

By ALISON LOWE
Tribune Staff Reporter
alowe@tribunemedia.net:


PLP Deputy Leader Philip "Brave" Davis yesterday claimed the appointment of political figures to the judicial bench by the Prime Minister is undermining the fight against crime.

Essentially accusing Hubert Ingraham of master-minding the resignation of Malcolm Adderley from the PLP and politics this week, Mr Davis accused Mr Ingraham of playing political games with the country when there are more pressing matters like crime and unemployment that he should be addressing and called on Elizabeth constituents to use the upcoming by-election to "send a message" to the Prime Minister and the FNM that "enough is enough."

Mr Davis said: "Hubert Ingraham just this week spoke about new crime fighting initiatives. We need a new direction. Yet the man talking one thing and doing another! In order for the fight against crime to be effective there must be a well oiled, functioning and Independent judiciary! Since returning to power Hubert Ingraham has engaged in the most blatant politicisation of the judiciary!

"In the last 12 months he seen to it that at least two judges appointed to sit on the Bench of the Supreme Court came directly out of the belly of the FNM. At the same time he has done all in his power to rid the courts of any judge who he even dreams may have voted PLP at least once before!

"We have judge after judge after judge who due to political affiliation has to excuse themselves from hearing certain cases. How does this address the back log in our courts? It doesn't!" said Mr Davis.

Mr Davis made his charge as he addressed a PLP Rally at Doris Johnson High School in the Elizabeth constituency in the wake of Malcolm Adderley's resignation from the PLP and as MP for the area.

Speaking as he announced his resignation as the Elizabeth MP on Tuesday in parliament, Mr Adderley blamed his decision on his deteriorating relationship with PLP party leader, Perry Christie, throughout his seven and a half years as an MP.

He suggested Mr Christie's poor leadership and behind-the-scenes efforts to undermine him as a representative had left him with the belief that Elizabeth constituents "deserve better." Mr Adderley is rumoured to soon be set to take up an appointment as a Supreme Court judge, on the recommendation of Mr Ingraham.

Cat Island, Rum Cay and San Salvador MP, Mr Davis, proposed that the move was orchestrated to look like it was about dissatisfaction with PLP leader Perry Christie when in fact it is an attempt to get Bahamians to "forget the misery they are experiencing daily" under his government's leadership

Mr Davis charged that it is irresponsible to precipitate a costly by-election when government revenue is down and people are suffering in bad economic times.

"People are hungry! Lights are off! Some of our schools are like war zones! People are in pain! And yet this Government can only find money when it is time to play political games and pursue selfish agendas!" said Mr Davis.

"They think you are blind! They think that you cannot see what they are doing! They think you cannot see the games!" he added.

While the PLP has yet to announce who its candidate will be in the by-election, or to specifically confirm if it will nominate a candidate to contest the seat under its party's banner, Mr Davis told those at the meeting that the party is "ready".

"Stand strong and brave with the Progressive Liberal Party!" he added.

Mr Davis told The Tribune on Thursday that he firmly believes the party should contest the seat, although other senior party members are said to be unsure.

No date has yet been publicly announced for the election to take place however it is expected to occur sometime in February.

The Bahamas Democratic Party is the only political party to so far officially declare that it will be contesting the seat, with party president Cassius Stuart the intended torchbearer. President of the Bahamas Medical Council Dr Duane Sands is rumoured to be the FNM's preferred candidate for the area, although this has not been confirmed.

January 09, 2010

tribune242

Bahamas Blog International

Joblessness is A Pressing Concern for Bahamians in The Bahamas

STRAIGHT UP TALK

THURSDAY MAY 20^TH, 2004

By Zhivargo Laing

Nassau, The Bahamas

 

The Bahamas 2004/2005 BUDGET MUST DELIVER JOBS

Prime Minister Christie, who is also the Minister of Finance, is set to make his third budget communication since assuming office.  While he will undoubtedly have much to say on May 26^th during that communication, the one thing that thousands of Bahamians want to hear him say and provide evidence of is that they will find jobs within the next fiscal year.  Thousands graduated and graduating from high school and college, thousands of construction workers, thousands of unemployed or underemployed hotel workers and others have painfully endured over two years of joblessness.  They look to the upcoming budget for help and hope.

The Prime Minister will have a positive global economic outlook with which to work.  The world economy appears to be in full and sustained recovery.  The US economy is expected to grow at rate of 4.7%, with some 3.4% growth forecasted for the 30 richest economies that make up the Organization for Economic Cooperation and Development (OECD).  This robust growth is not expected to produce high inflation.  This is good news for The Bahamas, which according to IMF estimates will grow by some 2.5% in this year and 3% in 2005.  The question is: will this be jobless growth for The Bahamas, that is, will the economy grow but not produce much jobs in the process?

The economy of The Bahamas has grown positively for the last two years, in line with the economic recovery in the USA that began in November of 2001.  Despite this growth, however, unemployment over the period has grown, reaching about 10% according to the last published figures from the Department of Statistics.  The Household Labour Survey presently being conducted by the Department is likely to reveal that unemployment has remained unchanged or reduced only slightly.  It will certainly not reveal any strength in the labour market of The Bahamas.

This picture is likely to improve over the next twelve months but only slightly.  The best prospects for creating jobs over the next twelve months rest primarily with Kerzner International’s third phase and strong performance in the hotel sector.  Kerzner’s Phase III is the only approved foreign investment announced by the government that appears to have the ability to generate a significant number of jobs over the next fiscal period and these jobs will be primarily in the construction area.

According to its SEC filing dated May 4^th, 2004, Kerzner International expects to commence development of its 65,000 square feet Marian Village and the Expansion of its 200 2-bedroom Units in the Harborside at Atlantis between April and June of 2004 and complete it between October and November of 2005.  This will create a few hundred-construction jobs in the period.  The company gives no firm dates for other elements of its $1 billion Phase III but did reveal that it expects to complete the development in the Christmas of 2006.

The favourable global economic picture should translate into strong tourism performance for The Bahamas.  However, this performance is not likely to create many new jobs.  Rather, it is likely to secure the jobs of presently employed hotel workers over the next fiscal period and help hotel owners pay off arrears accruing from the horrible stagnation in the hotel industry for much of the last two years.  There is nothing to indicate any extraordinary growth in tourism within the next year that will create a large number of new jobs high school graduates, college graduates and large numbers of unemployed hotel workers.

What is particularly sad about the job prospects over the next twelve months is that they are extremely limited in much of the Family Islands.  The best prospects exist in Exuma, Abaco and Grand Bahama, and even these islands will at best experience only slight improvement in their employment pictures over the next year.  The other Family Islands will have to wait a little longer to see if any significant improvement will come to the economic situation.

Undoubtedly, the government will be tempted to generate jobs through its own hiring machinery.  While it claimed to have maintained a hiring freeze over the last two years, it would not be surprising to see the records show an increase in public sector employment over the period.  This stealth increase in employment in the government sector will continue over the next fiscal year and to some degree will be accelerated.  This notwithstanding, budget constraints will press the government to do less hiring than it would like.

The bottom line is that despite the positive economic forecast for the 2004/2005 fiscal period, joblessness will remain a pressing concern for Bahamians and for the Christie-administration.  If there is any significant relief to come, it will occur either two years out or by some miraculous development beyond the control of the government within the year.

LET’S BE WISER IN THIS ECONOMIC EXPANSION

There is no telling how long this global economic expansion will last, though positive growth is estimated into 2005.  There remain some significant uncertainties that could put a damper on this positive financial picture, most of all, the war on terrorism and the situation in the Gulf.  Another significant terrorist attack in one of the major economies, especially the US, or a bad turn in Iraq will have serious negative consequences for the world’s economy.

With this in mind, it is important for us to be wiser and more prudent that we were in previous periods of economic expansions.  Private businesses must not consume themselves with making profits in the short term.  They must focus on the long term-picture, focusing on productivity, human resource training, reinvestment, global alliances and readiness for trade liberalization.

The government must focus on fiscal discipline, public sector reform, privatization and investment in education and training, among other things.  The government should have a strategic approach to inward foreign direct investment, attracting investments that are tied to long-term development and sustained economic opportunities.

SOME PEOPLE JUST CAN’T HANDLE THE TRUTH

Readers will recall that during the 2002 general election, the PLP had a little boy on a campaign ad thanking the PLP for all it had done for The Bahamas.  Frankly, it was a cute ad.  “Thank you PLP for Independence,” the little boy enthusiastically and smartly said.  “Thank you PLP for National Insurance,” he continued on and on.  The PLP’s reference to history then during that political season did not seem to bother certain people.  Today when one reminds Bahamians in a non-political season that Sol Kerzner had a five-phase development approved by the FNM administration, of which, the current third phase was one, those same people suggest that there is something wrong.  Well too bad too sad for them!  History is history, facts are facts and the truth is the truth!  Those who want to live in the “Never Never Land” can do so.  We live in the real world where reality is as stubborn as a mule.

This column reminded Bahamians that Kerzner International’s third phase was approved prior to the PLP coming to office not to lay claim to it for the FNM but to point out that the PLP was being disingenuous in its politically-timed re-announcement of it and that it had an about face on the question of Kerzner International that bordered on hypocrisy.  One doesn’t get over the truth; one embraces it.  One does, however, get over multiple and sizable chips that jaundice one’s view of the world.  It seems that some people’s near-hatred of the FNM makes them feel that the Party should never remind the public of its accomplishments though they try to conjure up some for the PLP.  We leave them to their ill-fated path. 

 

THOUGHT FOR THE WEEK

 

“Truth is as impossible to be soiled by any outward touch as the sunbeam.”  John Milton