BEC: Give tax breaks to create jobs
Businesses should be given tax breaks to encourage them to keep staff and create jobs as the economy continues to shrink, according to Bermuda Employers’ Council.And Martin Law, the council’s executive officer, says Government needs to gather and make public accurate, up-to-date workforce statistics if it wants to tackle the growing unemployment problem. Mr Law estimates at least 3,000 jobs have been lost in the past two years as the effects of the global recession have been felt on the Island.“It’s anecdotal but it’s anecdotal based on the fact that we have a lot of members who are having to shed staff so we can do reasonable projections on that basis,” he said. “I do not claim that it’s accurate (but) it’s better than a guestimate. It’s an estimate based on experience.”He said everyone in Bermuda needed to accept there had been a “massive shift in our economic reality” over the last two years and engage in a national dialogue on how to meet the challenge.“Job creation and retention is key and the private sector is the only place that this can happen meaningfully,” he said. “So Government needs to incentivise job creation and retention. They could do that by tax breaks for employers who keep staff on or employ young people. Rather than tax them, take the tax away.“For example, if you still have the same number of employees in 2011 as in 2010, then there could be a little bit of tax relief. If you have more employees, it’s a bigger relief.“It’s incentivising employment rather than penalising employers who retain or take on more staff.”Employers will find out on Friday if they will benefit from tax incentives or suffer another payroll tax hike when Government releases the 2011/12 Budget.A clearer picture of the number of jobless and the number of jobs lost in the last year should also emerge, in the accompanying National Economic Report 2010.The only official unemployment figure Government will currently quote is 4.5 percent, or about 1,700 jobseekers, which is based on a Labour Force Survey of 1,400 households conducted between May and July 2009.The Department of Statistics is not believed to have done a Labour Force Survey in 2010 due to the demands of the census and has not yet released any information from last year’s annual Employment Survey.Statistics director Valerie Robinson James told The Royal Gazette: “Unfortunately, the 2010 Employment Survey data will not be released prior to the National Economic Report 2010.”Business leaders have said ever since the 4.5 percent figure was released a year ago that the real unemployment rate is far higher and have urged Government to publish current information based on the number of workers paying social insurance contributions.Economy, Trade and Industry Minister Kim Wilson said last night: “I have gone on record stating that the Government is currently working with the Department of Social Insurance to gain a more current profile of the unemployment figures month over month.“I am hopeful that I will be in a position to release this information in the near future and certainly by the end of the first quarter (of 2011) as compared with that same period last year.“Inkeeping with Government’s objective of providing the public with transparency, I am more than willing to share the results once the data has been accumulated.”Acting Financial Secretary Anthony Manders explained that anyone working more than five hours a week must pay social insurance so the number of contributors could be a better gauge of employment than, for example, the number of employers paying payroll tax.In July, 2009, 37,805 employed persons were registered with the Department of Social Insurance, compared to 38,580 for the same month in 2008.Patree Watts, Compliance Manager at the Department of Social Insurance, said: “This number is not an indicator of the number of jobs or positions held as some people have more than one job and social insurance contributions are liable to be paid by one employer only.”The National Economic Report for 2009 said there were 39,502 filled jobs, compared to 40,213 during 2008.The Labour Force Survey 2009 gave an estimated available labour force of 38,263, with 36,549 people employed and 1,714 seeking work.Mr Law said the sooner fresh statistics were released by Government, the better. “We need to know just where we are. You can’t make good decisions without good data.”A source in the restaurant industry, who would not be named, agreed. “Everybody in Bermuda knows that at a minimum we have lost 3,000 jobs. That’s everybody talking among themselves.“I think Government recognises that they can’t make proper policy decisions not even knowing what facts they are going on.”