Since 1994 Bermuda’s economic model has changed and it has become apparent that further clarification of why International Business (IB) and the foreign workforce (white and blue collar) is a vital and integral part of Bermuda’s economy and Gross Domestic Product (GDP). Over the next few articles we will attempt to explain why we need the foreign factor in our economy in order to make it viable and successful.Our current situation is unique to Bermuda, and it is not well understood. Some of the efforts to correct today’s situation are making matters worse. Understanding our economic situation requires a clear understanding of how Bermuda functions today.Shortly after Bermuda’s economy switched from Second World War mode back to tourism, the Bermudian component in the National Workforce [NWF] had to be significantly supplemented by imported labour. Between 1947 and 1993, the ratio of Bermudian workers to imported workers started at two non-Bermudian to 18 Bermudian and rose to five non-Bermudian to 18 Bermudian.Critically, this imported labour was used to supplement Bermudian efforts to cater up to 631,000 tourists sleeping in as many as 10,000 hotel beds spread across 100 properties and with several cruise ships in Bermuda at any one time.The key point? This imported labour supplemented the Bermuda labour. During this tourist era, the Bermudian portion of the labour force grew from 16,898 in 1950 to peak at 28,069 in 1988.Putting the two facts together, the total workforce grew and peaked at 36,420 in 1988. At this peak, the Bermuda section was 28,069 or 77 percent of the NWF. The imported ‘supplemental’ section was 8,351 or 23 percent.In 1994, a fundamental shift occurred — and this shift is still not understood. The proportion of non-Bermudian labour increased:n 1994 — 6 non-Bermudian to 18 Bermudiann 2008 — 9 non-Bermudian to 18 Bermudiann 2008 — 13,033 non-Bermudians and 27,180 BermudiansThis was a major and massive shift in proportion.There was a second simultaneous tectonic shift. This was in the basic nature of the imported labour.In 2008, the International Business sector employed 11,994 workers while the hotel industry employed 4,869 workers. But the tectonic shift was that thousands of the people in this larger 11,994 person group had not come to Bermuda to supplement Bermudian labour. Their reason for being here was completely different.Many of the 11,994 came here as the primary service provider to a global business operation that had chosen to base itself in Bermuda and use Bermuda as a business platform. Having come here, just like our tourists, they needed to be serviced and supported.How did Bermudians serve and support? By providing financial, legal and accounting services. By providing apartments, condos and houses to rent. By providing office buildings, office space and household support service. By providing technical services in the form of dependable air conditioning, electricity supply, smooth roads, adequate private schooling, a crime-free environment and good legislation.Looked at another way, in the tourist era, Bermudians invited Tourists to come into their living room. Once in that “Bermuda living room”, Bermudians hosted and entertained and cared for them. Since there were a lot of tourists (491,000 in 1980) and only a few Bermudians (24,200 Bermudian workers in 1980), we imported non-Bermudians to help us look after those thousands of tourists who had come into our living room.In 1994, that changed. Individually and collectively Bermudians moved out of the activity of hospitality to the activity of servicing and supporting International Business. The tourist staying for five days had been replaced by a working resident who stayed 365 days.That 365-daystayer acted completely differently from the five-daystayer. The relationship between the ordinary Bermudian and the five-daystayer was host and guest. It is completely different for the 365-daystayer.With the change from five-daystayer to 365-daystayer, many things have changed. Bermudians moved out of their living room giving it over to the wave of foreign workforce that began building up. Bermudians did not need to host and entertain these people in the same way that they had hosted tourists. Now Bermudians just needed to keep the utilities functioning, maintain the room, and where and when possible, get jobs that actually resulted in them working in the same space that had once been their showplace living room.This relationship between Bermuda and the foreign workforce needs to be clearly understood and our preoccupation should be on how we can and need to maintain their presence and their effect on Bermuda’s economy and directly on the Bermudian.Next ... looking at a hard reality.This continues to be a collective effort by all Bermudians and we need your support, comments and ideas. For further information or to express your comments e-mail Suzie Arruda at economy@challengerbanks.bm or visit us on Regeneration of Bermuda’s Economy.