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Jobs and education

Government's annual Jobs Survey for 2007 showed a number of trends continuing for the Bermuda economy.

Some of the news contained in Wednesday's report had already been well flagged. Finance Minister Paula Cox said in her February Budget that jobs growth had been slow in 2007, and she repeated the statement more recently.

So it was no surprise that the total number of jobs edged up by just 0.04 percent to 39,851 compared to 2006.

That is not necessarily a bad thing. In many ways, Bermuda's economy cannot handle more jobs, given that new employees add to an overburdened infrastructure and can cause further overheating of the economy.

The real issue is what kind of jobs are being created, who holds them and whether the community as a whole is benefiting from a full employment situation.

One of the key points to note here is that the number of jobs held by Bermudians is shrinking, both as a number and as a proportion of the number of jobs held. In 2003, 73 percent of jobs were held by Bermudians. That has now fallen to 68 percent. Even when non-Bermudian spouses of Bermudians and permanent residents are added to the mix, the trend remains.

This does not necessarily mean that Bermudians are being overlooked for jobs that are then being offered to non-Bermudians.

Instead, the primary reason is demographic: Baby boomers are retiring in greater numbers while fewer young Bermudians are entering the workforce. As a result, even if the number of jobs available remains static, there are going to be more non-Bermudians taking up vacancies, barring a change in the retirement age or a sudden return to the Island of Bermudians who have emigrated. And any jobs growth will necessarily expand the share of jobs held by non-Bermudians.

This has important long term ramifications for the economy and society generally, as it is a trend determined by birthrates over the last six decades. It is not going to be reversed for some time.

Another clear trend shows the movement from employment in hospitality, the retail and service sectors to, broadly speaking, white collar and office jobs. That puts a higher premium on skills, meaning at the very least that even more effort is needed on retraining.

That's no bad thing. Skilled jobs generally result in higher incomes, and if Bermudians are to benefit from the success of international business and its related sectors, then more and better skills are essential.

One change in the report is the slight reduction in employment in construction, which suggests the Island's long building boom is slowing. While this sector has seen a massive increase in non-Bermudian employment in recent years (and this means that jobs held by non-Bermudians are likely to go first as work permits are not renewed in the event of a construction downturn), people in lower skilled construction jobs may now face the prospect of having fewer new job opportunities.

The greatest area of concern remains the gulf in earnings between blacks and whites, which actually widened between 2006 and 2007, with whites earning a median of 29 percent above the median salary and blacks nine percent less. In 2006, blacks also had a median of nine percent less than the overall median and whites earned 27 percent more.

However, when median salaries for Bermudians and non-Bermudians are compared, Bermudians earned six percent less than the median income of $53,298 while non-Bermudians earned 21 percent more. This suggests that white and black Bermudians' earnings are much closer than the overall black-white divide shows, although past studies have shown there is still an earnings gap.

None of this means that the gap should not be narrowed, and this remains an area of deep concern. But it also reflects the nature of the economy and especially international business, where very highly paid senior executives still tend to be both white and non-Bermudian.

So what's the answer? While it is critical that the Department of Immigration and the Human Rights Commission ensure that blacks particularly and Bermudians generally are treated equitably and fairly, the real answers are still the words given in 1996 by the soon-to-be British Prime Minister Tony Blair when asked what his top priorities for government were: "Education, education, education."