ACCORDING to the recently released World Bank report on World Development Indicators for 2004, Bermuda's per capita income (GNI) is now the highest in the world.

While the World Bank reported that the average Bermudian earns "more than $40,000" per annum, the exact figure "was not made public". However, according to figures released by the Statistics Department in April, the estimated average wage in Bermuda is $53,816 ? far higher than the estimate published by the World Bank.

To put Bermuda's high per capita GNI into perspective, the average wage earner in the US makes $35,400 annually ? $18,416 less than the average salary of a Bermudian worker. French workers post an average income of $22,240 each year, which represents less than half of Bermuda's per capita GNI.

Countries with large overall economies ranked far lower than Bermuda in terms of per capita income: China, which boasts the sixth largest economy world-wide, recorded an average yearly income of only $960, while Saudi Arabian workers make approximately $8,530 annually.

The per capita GNI across the world is listed at $5,120. The typical Bermudian salary is therefore more than ten times greater than the world average, highlighting the great disparity between high and low income nations.

A high-income country is defined as one in which the per capita GNI exceeds $9,076 ? far less than the figure of $53,816 published by the Statistics Department, showing just how wealthy the average Bermudian is in comparison to wage earners in other developed countries. The World Bank listed only 55 countries in which the per capita GNI exceeds $9,076, while 63 countries reportedly post a per capita income of less than $735 each year.

While the average Bermudian earns more per annum than a worker in any other nation, there is a marked disparity in local earnings, with employees of the international business sector ? many of whom are expatriates ? making an average of $123,308 each year. In stark contrast, workers in the hospitality industry, including hotels, restaurants, caf?s and bars, earn an average wage of $26,113 annually.

Calvin Smith, research officer for the Bermuda Industrial Union, sees this vast difference in earnings as a serious problem.

"No matter how you look at it, we are doing well, but we must not forget there are people at the low end of the scale that are outside of all of this," Mr. Smith said. "There are people that are renting houses and may have good jobs but they're in competition with the foreign workers who are coming here and who are in turn subsidised by their employers.

"There are some offsetting factors despite this high standard of living that we need to be aware of. In fact, we need to be doing something about this."

Mr. Smith maintains that the high figure for per capita income, although real, is rather deceptive. "People question the validity of the measure because of the extraordinarily high rents in Bermuda. That's always been the case," he explained.

"I think if you look at some of the social indicators that reflect wealth like the extent to which people travel, the amount of cars per household, the number of telephones, and all of those so-called social indicators apart from income, you'll find that we're right up there, there's no question about that."

According to Mr. Smith, employees of international companies are not the only highly paid workers on the island.

"Bermudians that are working anywhere around computers, if it requires any level of skill, are making far, far more than the average person. Its just economics of scarcity," he explained.

"I'd say that the impact of the international companies certainly affects us because in every society there is what you might say is a leading industry, or an industry that drives the rest. In the case of Bermuda, international business drives the rest.

"I wouldn't separate that out. Part of being a Bermudian is the fact that we have these international company people with high earnings, but if they weren't here, the average earnings in Bermuda would be a hell of a lot lower too!"

Mr. Smith explained that while professionals like lawyers, bankers, and accountants benefit the most from the presence of international companies, other sectors reap the rewards associated with spending by foreign workers.

"What we forget is they require staff at all levels, and the people that are picking up the extraordinary rewards for servicing this sector decide themselves to go build better houses," he said.

Despite the money pumped into the community by international business, there remains a sector of the Bermudian public that does not benefit from the presence of exempt companies.

"I think what we need to be concerned about is that there is a block of people that are not benefiting from this. There's a whole bunch of people that have been untrained or have been trained in things that are not required in great quantities by the international companies," Mr. Smith explained.

"People are trained in the trades, for example. It's true that there's a boom in construction but the requirements of construction in terms of labour are nowhere near what they used to be because of the heavy technology.

"It's common sense. Construction doesn't employ as many people as it used to. The retail stores aren't doing as well as they used to. They employ a lot of Bermudians."

Mr. Smith explained the problem inherent in the local workforce in terms of basic economics.

"We brag about the free enterprise system. According to the price system, when the demand is greater for a product, the price rises and profits rise. What we forget is that it doesn't always work. There are things that stop the price system from functioning, for instance if there are monopolies. Our banks are what we call an oligopoly and therefore it's not going to be working at the banks as strongly as at the retail stores or among small contractors.

"The more people in the market, the more they compete for wages. Although we have the price system, when it comes to the renter's market, for example, we've got a problem. It's not monopolistic elements at work but there's no question in my mind that the influx of foreign residents ? about 25 per cent of the workforce ? puts a hell of a lot of pressure on the rental market. The rental market can't respond, and you can't build a house for people who can't afford it."

Mr. Smith maintains that the Bermuda Government is responsible for solving the current housing crisis. Thus far, it has not lived up to its promises. "That's where Government comes in, just as Government comes in for old people who can't afford health care. They come in to correct those defects. They're not doing that now and they haven't been doing that over the last few years. They've been depending on a price system that can't possibly work for people that are outside of it."

Despite his misgivings, Mr. Smith believes in the legitimacy of the World Bank's findings. However, he sees Bermuda's high per capita GPA as more of a curse than a blessing.

"I think it's real. Because it's real, and high, it doesn't mean we don't have serious problems," he said. "The problems rise out of the reality of these high earnings because there are some people who can't compete in the renter's market because their earnings aren't high enough and they're not being subsidised by businesses. The people who are unfortunate are in trouble.

"If they happen to be in the hotels, that's a declining industry, so they're not going to be faced with growing profits and incomes. The hotels employ a lot of Bermudians. They're not going to be able to compete effectively during this shortage of housing. Government must come in to correct that or face some serious consequences in terms of social unrest. I'm not talking about politics. People get frustrated and angry and do all kinds of crazy things."

Mr. Smith does not see the wage disparity between foreign workers in skilled jobs and Bermudians in low-paying positions as a result of the falling standard of public education on the island. In fact, he maintains that the vast difference in earnings "has nothing to do with education.

"We educate everybody but we can't give them all computer jobs. These people are under severe competition from foreign workers."

Mr. Smith worries that the current situation could cause social unrest if Government does not intervene.

"You only need a half dozen people hitting tourists over the head and that's the end of everything."