Island suffers third straight year of job losses
The Bermuda Government yesterday confirmed what The Royal Gazette has been reporting for months now hundreds of people in Bermuda have lost their jobs.
Nearly 700 people in all lost their jobs in Bermuda last year, according to the Government, marking the third straight year of job losses for the Island. The vast majority of those made redundant were expatriates.
According to the annual Bermuda Job Market report, released by the Department of Statistics yesterday, there were 698 fewer jobs in 2011 than there were in 2010, a decline of two percent.
The report said the number of filled positions reported in 2011 was 37,399 compared to 38,097 in 2010. Of those 698 people who lost jobs, 691 were non-Bermudians and 60 were Bermudian, offset by spouses of Bermudians who gained 30 jobs and permanent resident certificate holders who gained 23 jobs.
My initial reaction is that this survey further exemplifies the need to change gears, said Buddy Rego, President of the Bermuda Chamber of Commerce. Relax employment restrictions, give incentive to the business community to create new business and job opportunities.
After reading the report, Doug Soares, a partner at Expertise, Bermudas largest management consulting and outsourcing company, said employees in the private sector seem hardest hit.
The level of austerity felt by private-sector employees has not yet been felt by Government employees. For the 12 months ending August 2011, Public Administration shed only 12 jobs and increased compensation by 1.5 percent over the annual inflation rate, he said.
The Government seems committed to preserving the size of the public service. This is only sustainable for as long as we continue adding to the public debt. Government has instituted a hiring freeze so downsizing will occur but too slowly to avoid the eventual need for reductions in the public sector payroll. At some point, job losses or reduction in hours of work, pay or benefits, or a combination thereof, will be required to match payroll costs with shrinking tax receipts.
The Governments report is based on a census of all businesses on the Island. The survey was conducted during the week of August 28 to September 3, 2011.
Mr Soares said unemployment figures are likely to get worse before they get better. It is important to note that the statistics published in the 2012 employment brief are already dated. They represent a snapshot of the job count in August 2011, Mr Soares said. So the question is, has the unemployment situation gotten better or worse over the past seven months? Unfortunately, the answer is worse.
The hardest hit sector was construction, which shed 493 jobs, a fall of 16 percent. Also hard hit were real estate, which lost 14 percent of its workforce due to a slumping housing market. The number of jobs in international business dropped five percent from 4,287 in 2010 to 4,077 in 2011, down 210 jobs.
Mr Soares points out that in some sectors, the losses might not get too much worse but for others, there could be greater issue at hand. For example, job losses in construction have slowed in recent months, he said. What is not well understood by the average Bermudian is the cause of the job losses. It is widely presumed that all job losses are caused by the recession. Not so.
For example, while a construction job is lost due to a lack of demand for building in the economy, most international business job losses are actually job relocations. This means that the job is just moving from Bermuda to another jurisdiction. So the question should be: what must we as a jurisdiction to retain international business job in Bermuda?
One of a handful of sectors not cutting positions was the hotel industry, which added 131 jobs last year. Restaurants, cafes and bars added 53 jobs. And 270 positions were added in education, healthcare and social work.
Those who managed to stay employed are likely earning more money. The median annual salary for jobholders in companies with ten or more employees increased three percent from $57,915 to $59,364.
For the third year in a row, women, on average, earned more than men. The median annual income for women was $59,677 and for men, it was $59,081. The report points out that the increase in womens earnings exceeding those of men is attributable to the decline in construction jobs, primarily held by men. Of all the jobs lost in 2011, male workers held 90 percent of them.
There was no change in the number of jobs filled by black workers however, there were significant job losses among workers who classified themselves as white, mixed and other races.
The highest average salary was in the international business sector at $111,938 while the lowest averages were in the retail ($42,000), hotel ($35,898) and restaurant ($35,664) sectors.
Non-Bermudians with no spousal ties to Bermudians were heavily employed in the professionals occupation group. Positions in that category include actuaries (123 jobs), lawyers (103) and certified accountants (490). They were also some of the better jobs with median salaries of $189,263 for actuaries, $184,902 for lawyers and $98,229 for certified accountants.
Other positions with large numbers of work permit holders, which also paid above the national median salary included junior accountants (174 jobs, $96,346), secondary school teachers, (153 jobs, $85,500) and registered nurses (490 jobs $67,598).
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