In the previous article we explained the shift in our economy from Tourism to International Business and the requirement for foreign workers. In this and subsequent articles we will explain why we needed and will continue to need the foreign factor in our economy and workforce.Since 1960, Bermuda’s National Workforce has relied heavily on foreign workers. Both of Bermuda’s economic models - the old Tourism and the new Business - rely on the presence of a large number of non-Bermudians.An inescapable but sometimes hard-to-accept reality, is that Bermuda’s economic success is predicated on the continuing presence of a significant number of non-Bermudians.From 1947 to 1993, that foreign presence was as supplemental labour working in support of Bermudian efforts in Tourism. From 1994 to now, that foreign presence is mostly as primary human capital for International Business (IB). This difference creates a unique and complex social dynamic and economic relationship.Either way, foreigners are a key component for Bermuda’s economic success and regeneration. It has been that way for over 90 years.A reason why we need foreigners is that there are not enough Bermudians to service Bermuda’s existing and traditionally over-sized economy. It has been that way since the 1920s. Between 1950 and 1980, Bermuda dealt with that by drawing Bermudian women out of the household into the workplace. Between 1950 and 1980, the female component in Bermuda’s National Workforce rose from 31 percent in 1950 to 45 percent in 1980. In 2011, it was 49 percent.Between 1960 and 1988, Bermuda’s National Workforce went from 19,498 to 36,420 - adding 16,922 workers. But the Bermudian component only went from about 16,700 (1960) to 28,069 (1988). So 16,922 more jobs, but only 11,369 additional Bermudians to fill them.The shortage was made up by importing 5,553 foreigners - adding an average 198 foreign workers per year in the years between 1960 and 1988.This meant that by 1960, Bermuda had already grown an over-size economy that was much too big for the slow-growing population of native Bermudians.By 1980, every Bermudian who wanted to work and was able to work had been sucked into Bermuda’s National Workforce. From 1981, Bermuda became increasingly reliant on imported labour. The proportion of imported labour rose from around 15 percent in 1960 to hit 23 percent in 1988.After 1988, strange things began happening with the Bermudian component in the National Workforce. The all-time peak was 28,881 in 2000. It has since fallen to the 2011 low of 26,187. So from 2000 to 2011, Bermuda has actually lost 2,694 Bermudian workers. These are not just unemployed Bermudians, these are also Bermudians who have emigrated or who have not returned to Bermuda.Between 2000 and 2008, Bermuda’s economy boomed with GDP growing 74 percent. Bermuda’s economy added 2,196 workers but, at the same time, Bermuda’s economy lost 1,701 Bermudian workers, for an average 212 Bermudians who were lost each year. With the Bermudian economy still actually growing, each lost Bermudian worker was being replaced by a foreign worker.Result? Between 2000 and 2008, Bermuda’s economy added 2,196 foreign workers who came here to feed Bermuda’s economic growth. The economy also grew by adding 1,701 foreign workers who came here to replace the Bermudians who had disappeared from the National Workforce. Overall, in the booming economy between 2000 and 2008, Bermuda added 3,897 foreign workers - an average 487 foreign workers added each year. Compare that to the average 198 per year from 1960 to 1988.The pool of Bermudian labour is stuck at a figure that is less than 28,881. Since 1978, Bermuda’s economy has always required more than 29,000 workers. At peak in 2008, Bermuda’s economy required 40,213 workers. In that year, there were only 27,180 Bermudians. So the 13,033 difference was made up by foreigners.Twist, turn, flip, leap through fire; the answer will always be the same. Bermuda’s over-size economy requires the presence of non-Bermudian workers - as it has for over 90 years.There is an additional factor. Bermuda is now Business Bermuda. Business Bermuda especially requires the on-Island presence of ‘human capital’ as well as persons who come here to supplement Bermudian labour working in infrastructure support (blue collar worker).Specifically:Ÿ Bermuda has an over-size 40,000 person economy (what we had at peak in 2008)Ÿ There are only 27,000 Bermudian workers (but this number is dropping).Ÿ Bermuda has to have 13,000 non-Bermudian workers working in Bermuda.Ÿ If Bermuda’s economy shrinks, work can still be found for 27,000 BermudiansIn 2012, Bermuda’s economy is still shrinking. Non-Bermudians are leaving. Bermudians are also leaving or not returning. The loss of non-Bermudian IB ‘human capital’ creates the largest negative. The loss of supplemental (blue collar) labour creates a lesser negative. All three losses shrink and damage Bermuda’s economy.The economy is Business Bermuda. Business Bermuda must regenerate. Tourist Bermuda must not die.Sending non-Bermudians home is the wrong solution because it perpetuates and strengthens the overall economic decline. The answer lies in re-inviting ‘human capital’ back to these shores. That returning ‘human capital’ will stop Bermuda’s economic shrinkage. It will provide and re-create new jobs and fresh job opportunities for Bermudians.Next.........Too Few BermudiansThis continues to be a collective effort by all Bermudians and we need your continued support, comments and ideas. For further information or to express your comments email Suzie Arruda at economy@challengerbanks.bm or visit us on FACEBOOK - Regeneration of Bermuda’s Economy.