Labour Market Forum 2010 - Planning Institute of Jamaica

Labour Market Forum 2010
Jobs for Growth: The Contribution of the Labour Market
in Economic Expansion
Planning Institute of Jamaica
Don Mills Training Room
Thursday, December 2, 2010
Speeches, Presentations & Pictures
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PROGRAMME
9:00 a.m. – 9:10 a.m. Dr. Pauline Knight, CD
Deputy Director General, PIOJ
Welcome and Opening Remarks
Session I
(Chair: Dr. Pauline Knight)
9:10 a.m. – 9:30 a.m. Dr. Reynold Simons
Senior Specialist, Employment and Labour Market Policies
International Labour Organisation
The Global Jobs Pact: Regional and International Perspective
9:30 a.m. – 9:50 a.m. Dr. Gladstone Hutchinson
Director General, PIOJ
The PIOJ Perspective: The Role of the Jamaican Labour Market
in a Contracting Fiscal Environment
9:50 a.m. – 10:20 a.m. The Hon. Pearnel Charles, CD, MP, JP
Minister of Labour and Social Security
Ministry of Labour and Social Security
Main Address
10:20 a.m. – 10:30 a.m. Entertainment by the Kingston Youth Information Centre
Creative Arts Movement
Session II
(Chair: Prof. Neville Ying, CD)
******Coffee Break******
11:00 a.m. – 11:20 a.m. Prof. Rosalea Hamilton
Vice President, Development, University of Technology
The Role of MSMEs in Economic Expansion
11:20 a.m– 11:40 a.m. Mr. Wayne Chen
Chairman
Jamaica Employers’ Federation
Jobs for Growth: The Role of the Private Sector
11:40 a.m. –12:00 p.m. Mr. Danny Roberts, CD
Head, Hugh Lawson Shearer Trade Union Education
Institute, UWI Jobs for Growth: The Trade Union
Perspective
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12:00 p.m. – 12:20 p.m. Mr. Benthan Hussey
Labour Market Consultant
Labour Productivity in Jamaica:
Productivity in Businesses
How to Improve
12:20 p.m. – 12:50 p.m. Open Floor Discussions
12:50 p.m. – 1:00 p.m. Ms. Tanya Francis
LMITAC Committee Member
Closing Remarks/Vote of Thanks
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Profile of Presenters
The Hon. Pearnel Charles, CD, MP, JP
The Hon. Pearnel Charles is the Minister of Labour and Social Security. He was born in
Macedonia, St. Ann in 1936. He attended the West Indies College and graduated from
the City College of New York, after studying Political Science. He is an author, Trade
Unionist and Vice President of the Bustamante Industrial Trade Union.
He served as KSAC Councillor from 1967 to 1976. He was a Senator from 1972 to 1980
and JLP Deputy Leader from 1972 to 1991. Mr. Charles served as Minister of Local
Government from 1980 to 1993 and as Minister of Public Utilities until 1989 during the
two term tenure of the JLP during the 80’s. Mr. Charles served as Member of Parliament
for the St. Thomas Eastern Region in 1995.
He is married to Gloria Hanson, and has three sons and four daughters.
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Gladstone Anthony Hutchinson, Phd
Dr. Gladstone Hutchinson was appointed Director-General of the Planning Institute of
Jamaica (PIOJ) on July 5, 2010. The PIOJ is a national agency under the Office of the
Prime Minister with responsibility for leading the formulation of policy on economic and
social issues and managing external cooperation to achieve sustainable development for
Jamaica. The Institute initiates and coordinates the development of policies, plans, and
programs for the country’s economic, financial, social, cultural, and physical
development and undertakes research on national development issues. It is the lead
agency for the implementation of Jamaica’s national development plan, Vision 2030
Jamaica – “Jamaica, the place of choice to live, work, raise families, and do business.”
(www.vision2030.gov.jm)
Prior to his appointment, Dr. Hutchinson held the post of tenured associate professor of
economics and business at Lafayette College in Easton, Pennsylvania, one of America’s
top institutions for first degree studies. There Dr. Hutchinson, aside from teaching and
research in public finance, economic development and entrepreneurship, coordinated the
College's national and international projects in entrepreneurship studies, and was the
founding director in 2007 of its Economic Empowerment and Global Learning Project
(EEGLP; http://eeglp.lafayette.edu). EEGLP, which quickly rose to leadership and
prominence in higher education across America, uses a public scholarship paradigm
(collaborative knowledge-making and problem solving about, with, and for various
publics and communities) to partner with residents and communities to build their
capacity for business entrepreneurism and self-agency in pursuit of their community's
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economic development and democratic renewal, and of the expansion of the freedoms
they entail.
Between 2001 and 2006 Dr. Hutchinson served as Dean of studies at Lafayette before
returning to the classroom. A particular emphasis during his deanship was the role of the
arts, creative humanities and cultural disciplines in liberal learning and undergraduate
education. While in this post he led a partnership with the University of Michigan and
Stanford University to incubate creative works that were developed into a successful
national performance-art tour (The 51st Dream State), and later into a national curriculum
project.
Between 1996 and 2001 Dr. Hutchinson served as an economic adviser -residential and
non-residential-- to the Government of Jamaica on fiscal policy issues, global capital
markets, and economic development and reform issues, and as a visiting research
associate at the International Monetary Fund. His work on privatization and public policy
is recognized internationally as being among the influential works on the topic.
Dr. Hutchinson was awarded a Wye Faculty Fellowship by The Aspen Institute and the
Association of American Colleges and Universities (AAC&U) to study leadership
challenges in higher education in the twenty-first century, and a graduate fellowship by
the Earhart Foundation to study public finance and political economy. He also holds a
certificate in Higher Education Management from Harvard University.
He serves as a member of the Board of Trustees at Clark University (www.clarku.edu),
where he studied for his masters and doctorate in economics, and until this past May, on
the National Advisory Board of Imagining America, a consortium of over ninety
universities and colleges across America with the mission to strengthen the public role
and democratic purposes of the humanities, arts, and design
(www.imaginingamerica.org). Imagining America began in March 1999 as a partner of
the White House Millennium Council. Dr. Hutchinson is also a director of the Institute of
Economic Policy Studies in Worcester, Massachusetts, and an inductee in the Sports Hall
of Fame at the State University of New York-College at Oneonta, where he studied for
first degrees in economics and business while on a football scholarship from Jamaica.
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Professor Rosalea Hamilton
Ba (Hons), Mia, Llb (Hons), C.L.E., Phd
Professor Rosalea Hamilton holds a number of distinguished positions which allows her
to make a significant contribution to the development of this country.b As President of
The MSME Alliance, a network of 36 Business Associations representing micro, small
and medium-sized enterprises (MSMEs) in Jamaica, she is committed to the promotion of
entrepreneurship and development, which is evident in her on-going advocacy and
creative interventions to assist the development of the MSME sector. In recognition of
her outstanding work, she was awarded professorship for the Scotiabank Chair in
Entrepreneurship & Development in 2008.
At present she is also Vice President of Development at the University of Technology,
Jamaica (UTech), where she plays a critical role in devising strategies; implementing
programmes; ensuring viable cutting edge technologies; business development and
consultancy practices, geared towards enhancing the financial base of the University. She
also recently became a member of the Board of Directors for LASCO Manufacturing
Limited.
Professor Hamilton pursued her undergraduate studies in Social Sciences, specializing in
Psychology, at Middlesex University in England; a Masters in International Affairs at
Columbia University; a Ph.D. in Economics at the New School for Social Research in
New York; and an LLB degree in law at the University of London (External Division).
She has taught extensively at the graduate and undergraduate levels in the USA at
Tuskegee University in Alabama, City University (John Jay College) in New York, Nova
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Southeastern University in Florida, Northern Caribbean University in Jamaica and at the
University of the West Indies, Mona, Jamaica in the areas of Entrepreneurship, Law,
Managerial Economics and International Trade.
Professor Hamilton is also the Founder and Director of the Institute of Law & Economics
(ILE) which was established in 1998. In addition, she has engaged consultancies with the
Ministry of Foreign Affairs and Foreign Trade, the United Nations Development
Programme (UNDP), the Commonwealth Secretariat, the International Labour
Organization (ILO) and other international organizations. From 2006 – 2007 she served
as Chief Advisor to the Prime Minister of Jamaica.
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Mr. Wayne Chen
Wayne Chen is the Chairman and CEO of Super Plus Food Stores, Jamaica’s largest
retailer. He studied Law at the University of the West Indies and has served on the boards
of several Jamaican companies including The National Commercial Bank, The Victoria
Mutual Building Society, and The CVM Television Group.
In the public sphere, he is the Chairman the Urban Development Corporation, the
National Land Agency, the National Gallery of Jamaica and the Advisory Board of the
Caribbean Policy Research Institute.
In 1998 he was the Jamaica Observer’s Business Leader of the Year.
He is the co-author of “Reggae Routes: The History of Jamaican Popular Music”
(Temple University Press 1998).
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Mr. Danny Roberts, CD
DANNY ROBERTS, CD is the Head of the Hugh Lawson Shearer Trade Union
Education Institute at the Open Campus of the University of the West Indies Mona. He
currently serves as a Vice President of the Jamaica Confederation of Trade Unions, and
was a former Vice President of the National Workers Union and a former President of the
Union of Clerical Administrative & Supervisory Employees.
An ACP-EEC scholar, Mr. Roberts is a graduate of the University of the West Indies
with a BA Honours in Communications with Social Sciences and a Master of Philosophy
(MPhil) in Government. He was the recipient of Jamaica’s fourth highest National
Honours in 2009, the Commander of the Order of Distinction (CD), for his contribution
to the trade union movement.
Mr. Roberts is a co-host of News Talk 93 morning radio programme, “Jamaica Speaks”,
a member of the Minimum Wage Advisory Commission, the Labour Advisory
Committee and a Council member of the tripartite Partnership for Transformation. He is
the former Chairman of the Michael Manley Foundation and previously held directorship
on the Boards of the National Housing Trust, the Statistical Institute of Jamaica, the
National Development Bank of Jamaica, Radio Jamaica Limited, the HEART
Trust/NTA, Self Start Fund and the National Council on Technical and Vocational
Education and Training. Mr. Roberts is married with two daughters, Sherice and Sasha-
Kay.
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Mr. Benthan H. Hussey, B.A., M.Sc. (U.W.I.)
Mr. Hussey is a Labour Market Specialist and HR/Organisation Development Consultant.
He has over twenty years of research, teaching, training and writing and advising on
related issues throughout the Caribbean.
Mr. Hussey has done consultancy work with significant national, Regional and
international organisations such as the International Labour Organisation (ILO), Bank of
Jamaica, National Investment Bank of Jamaica, Inter-American Development Bank, the
University of the West Indies, Price Waterhouse, the Caribbean Export Development
Agency (Barbados & Dominican Republic), where he served for two and a half years as
Consultant in Organisation Development, Goddard Enterprises Limited, Barbados
Shipping & Trading Limited, Banks Holdings Limited, Insurance Corporation of
Barbados, (Barbados), Jamaica Promotions Corporation (JAMPRO), Planning Institute of
Jamaica, Guardian Life Limited, the National Housing Trust, The Ministry of Labour &
Social Security in Jamaica, First Caribbean International Bank (Jamaica) Limited,
Jamaica National Building Society, Capital & Credit Merchant Bank Limited, Scotia
DB&G Investments Limited, Jamaica Money Market Brokers Ltd, JMMB.
The subjects on which he focuses include labour market research and information
systems and development, compensation research and planning, productivity
measurement and management, strategic planning, organisation structure & development,
job evaluations, employee share ownership schemes, and performance management.
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Mr. Hussey has published a number of articles and papers relating to human resource
management and development. He co-founded the Caribbean Labour Journal CLJ) and,
at different times, served as Editor and Managing Editor of the CLJ. Mr. Hussey
managed LabCom International Limited, a management consulting firm, which also
published the CLJ and the text "Human Resource Management: A Caribbean
Perspective", Eds. Noel Cowell and Ian Boxill.
His most recent book, the A-Z of Industrial Relations in the Caribbean, co-authored with
Dr. George Phillip, was published by the University Press, UWI, Mona, Jamaica in 2006.
Mr. Hussey has taught with different Caribbean Regional and international institutions.
He did over eight years as a tutor with the Department of Sociology, University of the
West Indies (U.W.I.), Mona, Jamaica, 1983-1991) and, more recently, lectured with the
Institute of Business and the Trade Union Education Institute, also at U.W.I., Mona.
Between 1997 and 2001 he taught with the Centre for Management Development,
U.W.I., Cave Hill Campus, Barbados, and Compensation Management and Research
Methods on the Florida International University Master of Science in Human Resource
Management (MSHRM) degree programme, in Kingston, Jamaica.
He currently lectures Job Analysis and Compensation and Employee Benefits on the
M.Sc. in Human Resource Development programme in the Department of Sociology,
Social Work and Psychology, UWI, Mona, and Human Resource Management and
Organisation Development & Change with the Mona School of Business, also at Mona.
Mr. Hussey is distinguished for having designed and conducted the first national
compensation surveys in Jamaica, on behalf of the Jamaica Employers’ Federation.
His consultancy project activities have spanned a wide range of enterprises, agencies and
associations (directly and indirectly as clients or as participants in client studies),
including significant industry and manufacturing entities such as Jamaica Broilers
Limited, Grace Kennedy Limited, Carnaud Metal Box Jamaica Limited, Red Stripe,
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Jamaica Producers Group, Caribbean Cement Company Limited, and bauxite mining
entities such as Alumina Partners of Jamaica Limited and Alcan Jamaica Limited.
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“The PIOJ Perspective: The role of the Jamaican
Labour Market in a contracting Fiscal
Environment”
Gladstone Hutchinson, Phd
Director General
Planning Institute of Jamaica
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Introduction
In a nutshell the labour market is the fulcrum of
macroeconomic adjustment. Putting an economy on path for
robust output growth through fiscal contraction depends
critically on an accommodating labour market response. My
presentation today is titled “The PIOJ Perspective: The Role of
the Jamaican Labour market in a Contracting Fiscal
Environment” will highlight some aspects of the required labour
market response.
For a variety of well documented reasons, Jamaica has long
suffered from economic underperformance and low economic
growth.
Faced with the pressures from an underperforming
economy, successive governments sought to grow the
economy and maintain some semblance of a working social
infrastructure through increased borrowing on the capital
market to supplement the country’s small and inadequate tax
base and low tax compliance. This in turn led to large and
expanding public sector debt, whose financing needs put
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pressure on the exchange rate, distorted the cost of capital,
and crowded out private sector investments. This crowing out
of the private sector is key because under the reforms aimed at
contracting the public sector, the crowing in of the private
sector is key if displaced public sector assets, including workers,
are to find new “abode.”
The global recession, combined with our economic structural
deficiencies and high public debt resulted in inter alia:
• decline in output in most industries resulting in increased
unemployment levels and net private sector job losses of
66,300 since the official start of the recession in October
2008;
• 12 consecutively
quarterly GDP decline since the
October to December 2007 quarter;
• decline in household demand for credit; and
• the loss of wealth and liquidity in the private economy
from the collapse of unregulated financial organisation’s
(e.g. OLINT, Cash Plus), the impact of the JDX on interest
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evenues which led to the ending of GOJ low risk high
return treasury bills.
All together, the downward trend in these key indicators
resulted in both private and public sector operating in a
contracting fiscal and economic environment.
In 2010, this
shrinking fiscal space was exacerbated by further
unprogrammed expenditures associated with the
o May 2010 Security Operations in West Kingston at
$22,5 billion. The total impact represented some 2.1%
of 2009 current GDP and 50.0% of tourism GDP; and
o Tropical Storm Nicole in September 2010 at a cost of
$20.6 billion. The cost of the impact of this storm was
equivalent to 1.9 per cent of current (2009) GDP,
and somewhat similar to the 2.1 per cent of GDP
occasioned by the impact of Tropical Storm Gustav
in 2008, which cost approximately US$214 million,
and
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o As made clear by the now tabled Supplementary
Budget, an assortment of unprogrammed charges
totaling over $11billion or close to 1% of GDP.
Needless to say our reform effort is further compounded by
Jamaica’s economic structural deficiencies, which have
slowed the pace of the recovery efforts.
The structural
deficiency relevant to today’s discussion is:
• The inadequate Labour quality: The quality of the
Jamaican labour force 1 has also negatively affected
Jamaica’s ability to reallocate labourers in areas that are
more viable, thus constraining the country’s ability to
recover from the recession and move into higher forms of
production (In the 2010-11 Global Competitiveness
Report, Jamaica ranked 80 out of 139 in the category
Higher Education & Training. Additionally, the country’s
inadequately educated workforce was tied for the fourth
most problematic factor for doing business).
1 Approximately 67.7% of the employed labour force did not have “Basic CXC or above” qualification in
2008.
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Despite the aforementioned challenges to fiscal consolidation
reforms, the country is seeing some moderation in the
economic decline and some promise of a turn-around. In fact,
for the July 2010 report on the labour market, the economy
created 21,300 positive net jobs since the April 2010 report,
compared to 6,000 net jobs for the corresponding period of last
year, and 17,600 positive net jobs between the January and
July 2010 reporting periods, as compared to a loss of 9,200 net
jobs for the corresponding period of 2009.
In as much as these are steps in the right direction, for the
country to generate robust economic growth that will result in
sustained creation of job, a coordinated effort is needed that
involves a process in which everyone has an important role to
play.
Specifically, with interest rates declining and businesses are
having increased access to capital for productive purposes,
how does/should the Labour Market respond?
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In its core essence labour must be convinced that the reforms
are credible and filled with the promise of a rise in their
permanent income. Otherwise rationality would dictate that
they squeeze whatever gain they can get out of the existing
market structure.
That is, will the private sector utilize the lower cost of capital to
retrain workers, improve firm productivity, expand markets,
grow their production and at the minimum grow their labour
force?
Or, is the economy expanding or expected to expand and
create opportunities for the displaced public sector workers to
be absorbed in productive and income earning activities?
If workers do not rationally anticipate an expansion in their
permanent income through the reforms, either through the
expanding private sector or their rising productivity, then they
will resist the reform effort itself. This is the crux of the challenge
facing labour market reform under efforts to grow the
economy through fiscal contraction.
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Hence, while probably a moral and needs case can be made
for the wage demands being made by public sector workers,
public sector workers and unions must appreciate their
important role in the country’s delicate fiscal balancing act
and economic reform efforts.
Wage demands that push
inflation, worsen public sector debt, or compromise
government’s ability to improve the social, economic and
business environment at the macro level will erode the nation’s
economic and social credibility, raise its risk premium and cost
of capital and doing business, and quickly erode even the
wage gains the workers and unions had bargained hard for.
The labour market must play its role in providing the flexibility
that is required for the productive sector to make use of the
opportunities that now abound, and maximize its efficiency.
This will lead to increased job security and increased wages in
the labour market for the long term.
As the workers’ representatives, the trade unions will have an
essential role to play in this effort. Jamaica has a creditable
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history of tripartite collaboration. And if the desired levels of
economic development, as planned under the Vision 2030 –
National Development Plan is to be achieved, the tripartite
collaboration must not just be continued, but rather deepened.
Thus far, tripartite collaboration in Jamaica has been
somewhat limited to the area of industrial relations, strictly
speaking. The deepening of the collaboration that is required,
would see tripartite agreements include not just issues relating
to collective bargaining agreements, but also include such
issues as employment promotion. A higher level of cooperation
is required, particularly under our current contracting fiscal
environment, where the tripartite partners engage in structured,
meaningful dialogue and decisions are taken with the
understanding that not all parties will see instant short term
benefits, but in the end, the sacrifices endured today, will lead
to a brighter future for all Jamaicans.
In the end all Jamaicans, including workers, face the now
excellent opportunity to look beyond the immediate and invest
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in the brighter promise of the future. The bottom line is clear:
the value of workers’ gains that are achieved through
excessive wage demands are quickly eroded, but not so wage
enhancement that is a result of workers partnering with the
government in fiscal prudence, providing the government’s
commitment is credible.
- End -
24

“The Government Perspective: The role of the
Jamaican Labour Market in a contracting Fiscal
Environment”
The Hon. Pearnel Charles, CD, MP, JP
Minister of Labour and Social Security, Jamaica
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As Minister of Labour with portfolio responsibilities for the labour
market, I would like to express my interest and passion for
creating new job opportunities and increasing productivity so
that we can have an efficient and effective labour market in
Jamaica despite the recessionary challenges.
Ladies and Gentlemen, According to the International Labour
Office (ILO) report on Regional Labour Market developments,
economic growth in the Developed Economies and the
European Union fell to approximately 1.4 per cent in 2008, the
lowest since 2002. On the other hand the unemployment rate in
this group of economies increased from 0.7 per cent to 6.4 per
cent in 2008 which by far, is the largest increase of all regions.
It also revealed that Economic growth in 2008 slowed down in
Latin America and the Caribbean to 4.5 per cent and is
expected to decline further.
It was based on these economic and social concerns that the
ILO, Government, Employers and Workers from the ILO member
States came together and adopted A Global Jobs Pact”.
Jamaica, through the Ministry of Labour and Social Security in
collaboration with the ILO Regional Office in Trinidad & Tobago,
and I note the presence of Dr. Reynold Simons, the Senior
Specialist, Employment and Labour Market Policies from that
office, has developed a Jamaica’s Jobs Pact for Economic
Recovery as part of the Decent Work country programme
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which is geared towards creating an enabling environment for
economic and social development with special emphasis on
the areas of job creation, implementation of policies and
social protection.
The Global Jobs Pact proposes a range of crisisresponse
measures that countries can adapt to their
specific needs and situation. It is not a one-size-fits-all
solution, but a portfolio of options based on successful
examples, also designed to inform and support action
at the multilateral level.
The Pact advises governments to consider options such as
public infrastructure investment, special employment
programmes, broadening of social protection and minimum
wages. Particularly in developing countries, such measures can
reduce poverty, increase demand and contribute to economic
stability. Donor countries and multilateral agencies are called
on to consider providing funding, including existing crisis
resources for the implementation of the Pact’s
recommendations and policy options. Therefore, Jamaica
continues to work in tripartite approach to implementing this
Jobs Pact.
Ladies and Gentlemen, let me turn now to the Labour Market
Information System (LMIS) which is managed by our Ministry.
We are pleased to announce that the Ministry of Labour, will be
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e-launching its Labour Market Information System website in
early January to facilitate new employment and training
opportunities for persons with varied skills. The Ministry will
embark on an extensive drive to secure a pool of multi-skilled
persons so I am urging all potential workers and employers to
come on board as soon as these opportunities arise.
The Government is cognizant of the negative impact that
redundancies can cause in a person’s quality of life hence we,
at the Ministry of Labour are working assiduously to address the
rising unemployment problem. Let me categorically state that
the employment figures which are recorded by the Ministry are
those which are officially reported by the Employer. Therefore, I
am urging all employers to report redundancies in a timely
manner or face the penalty of a fine of $250,000 or 3 months
imprisonment or BOTH. We are also encouraging the
redundant persons to invest some of their monies in re-training
themselves in new disciplines.
The Ministry, on the other hand, is strengthening its capacity to
reduce unemployment and produce a more skilled labour
force with the implementation of the Steps-To-Work, Special
Youth Employment and Training (SYEAT) and the Youth
Empowerment Strategy (YES) programmes. The Ministry is also
playing an integral role in the improvement of employment for
persons with disabilities by seeking to create more opportunities
for them or opening more windows in the productive sector.
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Based on empirical data from the latest Labour Market Study,
which was commissioned by the Ministry to determine the
demand and supply of skilled workers in Jamaica, there are
significant changes in the employment landscape.
Some of the major findings were that some 18% of employers
reported that they had at least one vacant position, with the
Agricultural sector recording the highest with 46%. It also
revealed that companies underwent a series of restructuring in
regard to their operations. Among the industries are;
Transportation, Financial and Manufacturing.
The survey also revealed that despite the economic
challenges, most employers are optimistic that they would
increase their employment complement within the next two
years based on expansion plans.
Skills Gaps in the Labour Force
Most significantly, the findings also revealed that there are gaps
in the skilled labour force. 40 per cent of the employers
declared that less than 20 per cent of their employees were
certified in a skilled area, while another 60 per cent indicated
that there is need for ongoing skills training in their
organizations. It must also be noted that the type of skills which
are in high demand are in; customer service, computer
technology and sales.
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Professional Gaps in the Labour Market
There are also career gaps in some key professions which will
have a significant impact on the economy; medical workers,
hospitality and tourism workers, special needs specialists for
health and education, speech therapists, psychologist just to
name a few.
The Demand for persons with Disability
Regarding the matter of persons with disabilities, the Survey
reported that some 21 per cent of employers that at least one
person with disability was employed to their organization and
49 per cent of employers reported that they were not averse to
employing persons with disabilities.
Hence, I would like to express my gratitude to those employers
for their support in providing employment for these special
persons and encourage other employers to get on board and
create employment opportunities for persons with disabilities.
Career Counselling Training Session
The Ministry is cognizant of the importance of proper career
guidance for students and so we have just completed a
training session with Guidance Counsellors across the regions
with a view to educating them about. The findings of the
Survey and thereby assist youths to make better career choices
for the future.
In closing, I have shared all of this empirical data with this
receptive audience, with the hope that we will all join as
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partners in making the Labour Market responsive and dynamic
despite the recession and other challenges given the unique
position that Labour offers to the socio-economic development
of the country.
Finally, let me express commendations to the PIOJ for staging
such an informative forum that allows key stakeholders to
critically examine the issues which have impacted on the
labour market and to arrive at possible solutions to addressing
these issues.
Thank you.
- End -
31

“Jobs for Growth: The Trade Union
Perspective”
Mr. Danny Roberts
Head of the Hugh Lawson Shearer Trade Union Education Institute
Open Campus, University of the West Indies Mona
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I am obliged to begin this presentation with a brief comment
on the economic philosophy which has created arguably the
worst financial crisis the world has experienced in the last 70
years. In reviewing that philosophy, I am equally obliged to
recognize that it is set on an historical continuum that has
defined our past and today, is threatening to reshape our
future.
This is not to say that we are by any means obsessed
with our historical antecedents, and likely to fall victim to the
impending misfortune against which Edmund Burke warns us of
planning the future by the past. It is rather an appreciation of
our understanding of the past so that we should not, in the
words of Marcus Garvey, be twice defeated in the race of life.
The international renowned economist and Nobel Prize
Laureate, Joseph Stiglitz reminded us that today’s global crisis is
profoundly unfair since those who are suffering most from its
effects were least responsible for its creation. He analyzed the
crisis as being structural, having to do with the imbalance in
global growth and the inequality in income distribution; and
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perhaps most importantly, he argued that the crisis was
produced by an ideology of market fundamentalism – which
he describes as “a belief in the self-regulating properties of
markets and denigration of the role of the state and public
welfare systems.”
On this continuum we can go back to the eighteenth century,
the days of the Industrial Revolution, and recognize that, like
globalization, it too offered opportunities as well as posed
threats. It was to have a positive impact on the growth and
development of European states, but similar to its successor, it
also proved to have very negative consequences for the social
dimension of the development process. The Combination Acts,
for example, which were passed by the British Prime Minister
William Pitt during the period of the industrial revolution,
between 1780 and 1800, were to facilitate the uninterrupted
gestation period of the new and emerging industries for
increasing job opportunities and economic growth, but which
dubiously legitimized the actions of workers to defend their
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ights and the conditions of their employment as criminal
conspiracy in restraint of trade.
British laws then formed part of an Imperial policy, with limited
global impact, forged not by the rules of world trade, but
through plunder and conquest.
It was therefore left to the
West Indian working class to throw off the shackles of Colonial
subjugation which sought to separate human-kind from the
potential benefits of economic growth and development, and
then, like now, to create a marginalized working class who
would find the fruits of their labour too often more bitter than
sweet.
This is the ideological continuum that Stiglitz so aptly describes,
whereas it was in the past, so it is in the present that the
prospects for economic growth seem always to have to be
constructed on the backs of an oppressed working class.
It is this context, I believe, that allows for a much more
enquiring approach to our topic – “Jobs for Growth” – to a
discernment of the kind of quality jobs we need to promote,
35

and the equity considerations which must underpin the
prospects for growth if we are to truly realize the full meaning of
development, with all the attendant positive benefits for the
people of Jamaica.
When we examine the empirical evidence coming out of the
experiences of the workers of the world, the marginalized, the
poor and dispossessed, globalization has created more misery
than hope, and a deep sense of despair. It is primarily through
the labour market that the effects of globalization have been
felt particularly by the working class.
The manifestations of
increased import penetration, export sales, competition in
services, foreign direct investment and exchange rate
fluctuations prompted by international capital movements
have all had an impact on employment and labour earnings.
The common concern, of course, is that “cheap” labor and the
“race to the bottom” may well be the flip side of globalization.
To become more competitive, countries are told to dismantle
their trade barriers, abolish their legal monopolies, privatize their
36

state-owned enterprises and reduce over-staffing in their
bureaucracies. These reforms have lead to the massive loss of
“good jobs” and boost unemployment rates. The
macroeconomic fluctuations resulting from short-term capital
movements have also increase job insecurity.
On the other hand, the delocalization of production to
developing countries in sectors such as food processing, textiles
or garments could also increase the demand for labour, thus
expanding employment opportunities and raising workers’
earnings. New jobs in export industries, however, might not be
as good as the privileged jobs lost in protected sectors.
The billionaire, Sir James Goldsmith, once said that “the mass
movement of manufacturing and services offshore not only
creates unemployment, but move at great speed to where
labour is cheapest.” Under globalization, workers have much
less ability to stand up to the dictates of capital than in the
past. This is quite often pitched as the argument against any
attempt by a government sympathetic to the workers’ cause
37

to break with the system. It is equally an argument about the
futility of workers fighting even for the most minimal of reforms
within the existing system
whether welfare reforms or
improvements in wages or working conditions from the
employer. Any attempt by workers to impose their demands
on capital will simply lead to it ignoring them and, if necessary,
decamping elsewhere in the system.
This was the effects of globalization prior to the world recession.
At its essence it proves to be both the cause and the
consequence of unfettered market excesses that prize, not
opportunity, but opportunism and risk equality and social
welfarism.
How therefore we approach the recovery from the global
economic fall-out to create the jobs which will lead to
sustainable growth becomes the crucial question. I want to
approach it by examining three critical issues which I believe
would be useful in guiding our considerations.
38

In the first place we have to arrive at some sort of
determination of what constitutes a good job versus a bad job
in our economy, and to link that to the conditions for
sustainable growth. In the second place we have to try and
identify those areas in which job growth would be essential to
driving productivity and competitiveness; and the third
consideration would have to focus on the kinds of policy
prescriptions that takes us beyond the recovery into
sustainability and ensure that the economy does not fall,
through weak policies, into a double-dip recession.
It is well known that a return to the pre-crisis level of
employment may take much longer than the obvious signs of
recovery.
But more importantly, for Jamaica to be on a
trajectory for sustainable growth, then the quality of the jobs will
undoubtedly have to be an important consideration.
The ILO’s Director-General Juan Somavia said that “the crisis
has again put before our eyes something we all know: good
39

jobs, quality jobs, decent work are, everywhere, central to the
lives of women and men.”
What then are the criteria to be used to determine quality jobs
or good jobs?
The Global Public Policy Network has outlined the indices to be
used to promote good jobs, which is what Jamaica needs if it is
to recover from this economic crisis and reverse the trend of
negative growth in GDP. The Global Public Policy Network said
that the index is used to measure the ‘progress of a country in
promoting good jobs, or jobs that offer fair opportunities, social
security and respect for the rights of workers.’
The index would measure a country’s progress in five areas: (1)
Equal opportunities for women; (2) a living wage; (3) job
security; (4) access to social security; and (5) respect for core
labour standards.
We have done very little to promote the right of workers to join
trade unions in Jamaica. There still exist far too many practices
40

of discrimination against women in our workplaces, and
workers no longer enjoy a sense of security in their jobs since
employment contracts are now fixed term, and they are largely
removed from the protection of statutory provisions and trade
union protection. We no longer need a law to prohibit the
combination of workers to defend their rights and interests; we
simply change the nature of the employment contract to
obtain the same effect.
The vast majority of our employed labour force is without any
form of social protection and the precarious nature of our
employment relationship is adding to that number.
Barbados has had Unemployment Insurance Benefits since
1982 and is the highest ranking Caribbean country on the
Global Competitive Index.
Brazil, Argentina, Germany and
Japan all introduced Unemployment Insurance coming out of
an economic crisis they faced during a period.
In the Global Competitive Report for 2010-2011, Jamaica ranks
poorly in the area of labour-management co-operation and
41

pay and productivity, important factors in determining quality
jobs.
And while our Vision 2030 Development Plan is
recognizing redundancy payments as one of the rigidities in our
labour market, a restrictive labour practice which affects our
ability to be competitive, the Global Competitive Report noted
that of all the factors that are most problematic for doing
business in Jamaica, “restrictive labour practices” scored a
mere 1.4%.
The Centre for Entrepreneurial Studies in Babson College, USA
conducted a research which results showed that job creation
in small and medium size firms is a necessary requirement for
economic growth.
But to ensure that the turbulence which
results from workers moving from job to job will not have a
negative impact on the labour market, and by extension
economic growth, the study points to appropriate policy
measures which should be
put in place to maintain the
flexibility of the market. These policy measures, according to
the study, should include unemployment compensation for
42

short term unemployment, fully vested and portable pension
plans and retraining programmes.
The PIOJ recently announced that 21,300 new jobs have been
created between April and July of this year. More than 60% of
these new jobs were in the wholesale and retail trade. This may
be seen as welcome news; however, it is not the sector
recognized by Vision 2030 National Development Plan as the
main sectors to generate increased productivity. The emphasis
as outlined in Vision 2030 should be placed on agriculture,
construction, the creative industries and sports, information and
communication technology, manufacturing, mining and
quarrying, services and tourism.
In a Study done by the Inter-American Development Bank in
2006 on the Informal Sector in Jamaica, it noted that
enterprises in the informal sector are concentrated in low
productivity, labour intensive activities. The study showed that
approximately 60% of these enterprises are in the
wholesale/retail trade, 70% of the employees are without
43

formal contracts and work is usually part-time as against full
time. This is the sector in which the majority of jobs occurred in
the last quarter in Jamaica, the sector – defined by the IDB as
the informal sector - where workers are fearful of exercising their
right to union representation; where virtually no pension
benefits exist; where women are discriminated against, and
there is no job security.
We could well see the exponential growth in the informal
sector, which presently constitute about 50% of the Jamaican
economy.
Under the new global economic orthodoxy of
greater marketization, investment patterns tend to favour
capital and disadvantage labour, especially lower-skilled
workers who cannot migrate easily. Forced to conform to the
rules of global trade, we have seen the radical restructuring of
production and distribution in the Jamaican economy that is
characterized by outsourcing and subcontracting through
global commodity chains.
44

In such countries as Egypt, El Salvador, India, Russia and South
Africa, a study done on Labour Markets and Informal work
revealed that the absence of jobs in traditional wage
employment could lead to the growth of informal employment
where working conditions are poor, no statutory provisions for
social security are provided and protection of unions are
absent.
Finally, what we need to do to ensure recovery. If more and
better jobs are to be created then we must see the
introduction of social policies and employment integrated with
macroeconomic policy strategies to ensure that the economy
grows rapidly to meet the demands of the new entrants into
the labour market and reverse the unemployment caused by
the global crisis.
We are yet to see the kind of fiscal and
monetary policies to support aggregate demand, the provision
of short-term work programmes and accelerated job recovery
through subsidies.
45

The rise of new Keynesian thinking is surely expected in
circumstances where the economic crisis has led to a serious
contraction of the economy. It is argued that the requirement
for increased government spending is essential for building the
framework for strong economic growth. There is as well the
need for government intervention, as is now evident in the
banking sector, to correct market failures and ensure stability if
we are to avoid a double-dip recession.
The Australian economy is doing pretty well, credited as having
one of the most robust stimulus packages, and providing over
106,000 jobs in the July to September quarter, the highest
increase in four years.
In fact, Prime Minister Kevin Rudd is
reported to have said that the government’s infrastructure
spending on roads, rail and education far outweighs any
concerns about Australia slipping into a budget deficit. Bob
Herbert in a New York Times article said that the US
infrastructure must improve. “Ignoring these problems imperils
public safety, diminishes our economic competitiveness, is
46

penny-wise and pound-foolish, and results in tremendous
missed opportunities to create new jobs on a vast scale.
Active labour market measures need to embrace workforce
protection measures as well as workforce development
schemes. In the book ‘Good Jobs, Bad Jobs, No Jobs’, Martha
Chen and Joann Vanek argued that “active labour market
policies need to address demand-side structural constraints
that discourage the creation of formal jobs, encourage
informalisation of employment relations, and undermine the
competitiveness of micro-entrepreneurship and own-account
producers.”
I believe the telling lessons of the last two years and the
experiences of other countries should serve us well in
understanding the policy prescription Jamaica has to take in
order to survive.
- End -
47

“The Role of MSMEs in Economic Expansion:
What is Required of Us?”
Prof. Rosalea Hamilton
President, MSME Alliance
VP, Development, University of Technology, Jamaica
48

OVERVIEW
⇒ The Development Challenge to be addressed in
Economic Expansion (Transformation)
⇒ Role of “Entrepreneurial MSMEs” in Economic Expansion
(Transformation)
⇒ What is required of “US”?
o MSMEs, Government, Academics, Consumers
THE DEVELOPMENT CHALLENGE
Lewis’ Dual Economy Model
One of the most comprehensive & enduring theory of
development
Key concepts of the development process:
Existence of surplus labour in subsistence sector - creates low
productivity, low wages & low standard of living
Capitalist sector has insufficient capital to employ labour
NOTE: Capital is mostly viewed as imported equipment &
material, knowledge, finance & the capacity for innovation
49

Development seen as the process of eliminating the duality by
accumulating imported capital to absorb surplus labour into
the capitalist sector
“Industrialisation by invitation” – reliance on foreign investment
An Updated Lewis Model
Development by Prof. Vanus James
⇒ Abandon the traditional Duality assumptions
⇒ Cheap labour available at a constant wage is a thing of
the past, accounting for

Accumulation of capital (domestic and imported) on different
terms suggest direct competition with the traditional importedcapital-intensive
sector…but there is also complementarity
Development no longer depends on an unlimited supply of
workers in a subsistence economy that can be attracted to the
capitalist sector at a price above subsistence
For James (2007), development now depends on:
A large flow of externalities from investment in domestic
capital, especially education to embody commonly available
knowledge (tacit knowledge), development/acquisition of
new/novel knowledge and the skills to use both forms of
knowledge
This is consistent with the Vision 2030 proposal for a new
paradigm for economic prosperity that focuses on developing
our knowledge resources and our institutional, human, cultural
and other forms capital
Production of domestic capital with both labour and capital, as
distinct from production of domestic capital with labour alone
as was assumed by Lewis (1954)
51

Growth of domestic capital at a faster rate than GDP and all
other economic variables
Developing the domestic capital sector generates externalities
and internal linkages that enables:
⇒ Growth of employment
⇒ Growth in innovative goods & services
⇒ Diversification of our economy
⇒ Enhanced capacity to attract & benefit from FDIs
⇒ Savings of foreign exchange
⇒ Increasing export competitiveness
⇒ Improvement in our Balance of Payments
⇒ Reduction of our Debt Burden
WHO will drive the growth of domestic capital?
It is here that we can identify the pivotal role of MSMEs in the
process of economic expansion
52

ROLE OF MSMEs IN ECONOMIC EXPANSION/TRANSFORMATION
“Entrepreneurial” MSMEs
It is the “Entrepreneurial” MSMEs (“E”MSMEs) who innovate and
add value that will drive the growth of domestic capital and in
turn, economic expansion and transformation
⇒ Most meaningful way to think about “MSMEs” and their
role in economic expansion (transformation) is to focus on
what they do and NOT their size
⇒ It is the ENTREPRENEURIAL ACTIVITY of the MSME that is the
most important feature of what they do in the economic
expansion process
Global competitiveness requires “E”MSMEs to have
business/managerial competencies derived mainly from:
⇒ Education/training; and/or
⇒ Experience and tacit knowledge (i.e., knowledge based
on habits and culture that we often are not aware of… or
the “natural” way we do things)
This tacit knowledge is important since much of the operating
knowledge of “E”MSMEs is TACIT
53

⇒ It is this tacit knowledge that is the major driver of
innovation among “E”MSMEs
⇒ We therefore argue that it is the innovative capacity
and competence to transform tacit knowledge into
commercially viable goods and services that is central
to “E”MSMEs driving the development of domestic
capital and, in turn, expanding & transforming the
economy.
⇒ This is taking place in the creative, cultural industries
and the copyright sector
Constraints to Development
James (2008), however, highlights two constraints limiting the
development of domestic capital:
1. Lack of resources in the hands of “E” MSMEs who wish to
innovate while creating capital (abundant labour with
tacit knowledge) while those with resources are not
innovating
⇒ Risks involved in innovation must be managed
⇒ Need access to financing and other resources
54

2. The shortage of foreign exchange
3. These constraints must be eliminated through investment
to unlock the power of tacit knowledge that drive
entrepreneurial innovation among MSMEs and accelerate
related domestic capital production
4. Such investment should include an Enterprise-Wide Risk
Management Programme that assists “E”MSMEs to
manage and mitigate the risks inherent in the creation of
capital
Benefits of Focusing on ‘E’MSMEs
⇒ Redistributes income in favour of owners of domestic
capital (local creative entrepreneurs) & enables poverty
alleviation
The self-employed typically earns about 4-8 times
more than the individual poverty line depending on
their parish
Importantly, it addresses the unemployment problem
⇒ Improves effectiveness of Policy Regime
55

Traditional sector is not generally responsive to
adjustments of the policy instruments available to
government – mainly influenced by external factors
⇒ Facilitates ↑ in productivity of use of imports
Every $1 spent on imports is likely to yield higher
returns when used in domestic capital intensive
production than in import intensive production
Saves foreign exchange
⇒ Facilitates intersectoral linkages & allows total output to
grow & restructure to achieve international
competitiveness
Enhances growth of exports due to local
innovativeness & creativity
WHAT IS REQUIRED OF US?
What is Required of MSMEs
⇒ Enterprise-Wide Risk Management & Financing
Programme
o Provide data for risk assessment & measurement
o Improve sector-related standards and technology
56

o Need to improve business skills
⇒ Business Entrepreneurial Empowerment Programme (BEEP)
o Special access to financing
⇒ Network/Alliance Building
o Importance of The MSME Alliance
⇒ Network of 35 organizations representing 300,000 MSMEs
o Active Lobbying
What is Required of Government
⇒ Good Governance
o Participatory governance framework that gives MSMEs
voice
Relevant MSME/Entrepreneurship Policies
⇒ Entrepreneurship policy tends to support individuals
engaged in the entrepreneurial process (e.g., training &
mentoring)
⇒ MSME policy tends to provide benefits and support for
firms (e.g., subsidies or tax-breaks)
⇒ Special Access to Financing
57

⇒ Significant investment in capacity building and risk
management essential to transform sector …MSME “Big
Push” Programme
What is Required of Tertiary Institutions
⇒ Relevant Competency-based Training
o Work-ready employers & business owners
⇒ New programmes for new industries
⇒ Relevant research to assist specific industries
⇒ Entrepreneurship
o Innovative thinking by employers & business owners
o Business Support services through student service learning
• Business Clinics
What is Required of Consumers
→ Buy Local and Support “E”MSMEs
58

“A Global Jobs Pact: A Regional and
International Perspective”
Dr. Reynold Simons
Senior Employment and Labour Market Specialist,
ILO Sub-regional Office for the Caribbean
59

Overview
More than a Financial Crisis
The ILO Jobs Pact
The regional employment situation
Economic and employment policy responses
Conclusions
More than a Financial Crisis
Most economists/policy makers failed to
predict/recognise the crisis and its scope/dept
The crisis was systemic in the global financial system
A product of “unbalanced globalisation” traced back to
the early nineties
Anchored in the global production system
Driven by two major structural factors
Global savings and investment imbalances
Rising income inequalities in and between countries
Jobs Pact...Sustainable Globalisation
International policy coherence & coordination
60

Global Stimulus package incl. support for policy
responses of Developing Countries
Supervisory and regulatory frame work (global finance,
Trade and Markets)
Low-carbon environment friendly economy
Decent Work response
Institutions
• G20
• UN system
Jobs Pact … Developing Countries
Multidimensional Development programmes giving higher
priority to:
Diversification of the economy
Employment creation and Social protection
Strengthen rural infrastructure and industry in support of
agriculture
Active Labour Market Policies
Enterprise promotion
61

Vocational and technical training/employment
services
Minimum wages
Outlook
Crisis … How long?
Stickiness of unemployment … particularly in the USA
Financial crisis still looms... Europe and the US
Imbalances remain: how were global
savings/investment imbalances and income inequality
addresses
Policy coordination.... but challenges
Exchange rates
Stimulus or austerity packages
Protectionism
Challenges to remain with us n the next years
The regional response
Initially in denial but:
Collapse of CLICO and the Standford Disaster
Energy (oil) prices
62

Falling aggregate demand (US & Europe) on tourism
Subsequently “riding out the storm” by sustaining fiscal
expenditure using reserves
The crisis affected various countries differently:
Tourism and Natural resource based economies
Reserves
As the crisis persisted, reserves came under pressure
Borrowing and self-imposed austerity
Conditional lending from IMF/World Bank
The regional employment situation
Employment growth and employment intensity of GDP
growth had already slowed down since 2007 and
unemployment increased
IMF expects recovery in the region in 2011 however in a
post-crisis global economy the region will face:
An emerging, new global economy
Lower investment levels and capital transfers
A challenge to its tourism market share: arrivals have
recovered but often at reduced prices/lower income
63

A challenge to maintain the “Caribbean stimulus” as
heavy indebted limits the fiscal space
Employment growth had already slowed down since 2007
and unemployment increased
Open unemployment increased in many countries incl.
Barbados, Bahamas, Jamaica and Trinidad and Tobago
There are no data available on underemployment …
especially important where work time sharing was applied
Diversification of the economies is still a major challenge
Protection of Real Wage levels ...major challenge in the
(post) crisis environment (only two countries adjusted
statutory minimum wages)
Employment Policy Responses
Little response to the ILO Caribbean Jobs Crisis
Observatory
No integrated employment policies in response to the
crisis … mostly “implicit policy responses”
Some examples:
64

Trinidad and Tobago: continuation of the URP/CEPEP
programmes (more than 7% of the labour force) during
the crisis … new policies now
Barbados: utilising the Unemployment Insurance funds
for training redundant workers
Most Gov's maintained public employment at existing
levels
Adjustment of Minimum Wages
Conclusions
Considering the structural challenges to our economies
employment protection and creation are closely linked to
development programmes to maintain existing economic
activities and branch out into new ones
Active labour market policies can play a major role in the
success of such programmes (TVET, Employment Services,
Enterprise Development, migration policies,
rural/agricultural policies, labour based projects for
temporary employment programmes)
65

It is necessary to develop and publish employment
policies to ensure integration of various measures, monitor
and evaluate impact
- End -
66

“Labour Productivity in Jamaica How to
Improve Productivity in
Business”
Benthan H. Hussey
Labour Market Specialist & Consultant
Labour Productivity
67

Labour Productivity an Overview
→ Jamaica’s low labour productivity does not lend to any
simplistic understanding, such as laziness of workers, low
levels of investments, governmental bureaucracy, etc., as
often proffered.
→ Rather, labour productivity is affected by a mix of factors;
→ some historically grounded,
→ some due to lack of leadership and enlightened
management
→ Some to lethargy and lack of motivation, stemming
largely from workers, to paraphrase BUJU Banton,
“not ruling their destiny”,
→ And some, subsuming some of the issues above,
relate to a poorly structured and inefficient labour
market.
68

Context
Economic growth is the accumulation and expansion in the
production of goods and services of a jurisdiction, industry or
enterprise on a sustainable and renewable basis
→ Development is the extent to which the standard of living
and quality of life of the citizenry, in general, is of
acceptable international standard and is sustainable
through equal opportunities to education, health, work
and recreation, etc.
→ Productivity is the extent to which input resources are
managed and manipulated to add value
→ Productivity growth and competitiveness are the bases on
which the standard of living and general social and
economic well being are ensured.
Productivity & Competitiveness (Global Competitiveness Report
2008-9)
Competitiveness: the set of institutions, policies, and factors that
determine the level of productivity of a country.
69

The level of productivity, in turn, sets the sustainable level of
prosperity that can be earned by an economy. In other words,
more competitive economies tend to be able to produce
higher levels of income for their citizens. The productivity level
also determines the rates of return obtained by investments in
an economy.
Personal Objectives
→ To encourage general dialogue and discussion on
productivity and competitiveness and their importance to
national development
→ To encourage concerted and collaborative approaches
to research and policy development on productivity and
competitiveness
→ To encourage enterprises and agencies to begin a
process of implementation of methods and systems to
realize higher levels of productivity and competitiveness
→ To encourage a process of expenditure and distribution of
reward based on productivity and performance
70

Measuring Productivity: Issues & Concepts
Productivity =
Output (Value added, Quantity Produced, etc.)
Input (Labour, Material, Capital, etc)
Labour Productivity: The Focus
There are three different measures of labour productivity:
• Unit labour productivity:
Output /ValueAdded
=
Numberof Employees
Unit labour-cost productivity:
Output /ValueAdded
=
Compensationof Employees
Unit labour-time productivity:
Output /ValueAdded
=
TotalNumberof HoursWorked
The Labour Market & Economic Growth
→ It is Labour’s ability to convert or utilize resources efficiently
and productively, i.e. add value or improve on them
→ Therefore, labour must be equipped, skilled, organized,
motivated and engaged to this end.
71

Jamaica’s Labour Market: Selected Indicators (2007- 2009)
Indicators 2007 2008 2009
Population 2.68M 2.69M 2.70M
Population 25-54 1.09M 1.11M 1.12M
Economically Inactive 192,000 172,800 196,200
Economic Inactivity Rate 18% 16% 16%
Labour Force 1.277M 1.300M 1.271M
LF Participation Rate 64.9% 65.4% 63.6%
Employed Labour Force 1.15M 1.162M 1.126M
Elementary Occupational Emp. 173,0001 63,000 144,700
Elementary employment rate 15% 14.1% 12.8%
Part-time employment 148,300 141,300
Youth Unemployment (14-24) 49.000 49,800 46,700
Youth Unemployment Rate 23.7% 25.9% 27.1%
Long-term unemployment
long-term unemployment rate
Own Account Employment 384,000 401,100 415,100
Own Account Employment Rate 33.4% 34.5% 36.9%
Income Inequality (Gini
Coefficient)
0.38 0.38 0.37
72

Some Features of Jamaica’s Labour Market
1. Structural Unemployment
a) Migration of skilled workers (among the 21,614 to
USA, CA, & UK in 2009)
b) Work permits (5,084 in ’08; 3,569 in ’09, respectively)
c) Anecdotes
2. Frictional unemployment:
a) Underutilized LMIS
b) Repeat advertisements
c) Poorly structured job profiles, etc.
d) Poor job offers
3. Low employment creation:
a) Unemployment rates
b) Long-term unemployment rates (unemployed for 1yr
or more)
4. Significant underemployment:
a) Wage related
b) Quality of jobs, (low productivity, etc)
73

c) Time related (69,500 and 69,300 in ’08 and ’09,
respectively (ESSJ ‘09))
Productivity of the Jamaican Economy
→ “The productivity…, on average, by 1.3 per cent per
annum between 1972 and 2007. This means the average
worker in Jamaica has been producing less, each year,
over the period.” JPC Summary Report, 1972-2007
→ By my calculation, using the 1990-2000 data set, we will be
producing at US$10,061 per worker in 2030, the year of
expected developed status; merely $1,000 higher than
the 2003 figure of US$9,080 per worker.
Jamaica’s Labour Productivity has not always been low or
negative
The country experienced:
→ Annual average increases of 5.29% between 1954-1966
→ Annual average increases of 5.19% per annum between
1960-1969
The question then is what happened to cause the Slide?
74

Table 1: Real GDP Per Worker (1995 International Prices) Selected Countries, 1956 - 1990
Year Barbados Canada DomRep Jamaica Singapore T & T USA
1960 6724 19484 4130 4338 5008 16901 24433
1961 7085 19316 3975 4367 5225 18375 24431
1962 7690 20050 4741 4496 5381 18034 25318
1963 7412 20581 5075 4522 5669 19190 25882
1964 7721 21354 5343 4986 5308 19975 26794
1965 8442 22245 4544 5336 5476 19331 28051
1966 8725 23145 5096 5569 5862 19470 29152
1967 9698 23294 5067 5751 6371 19721 29369
1968 10182 23973 5008 6472 7020 18620 30192
1969 11236 24746 5392 6801 7876 21356 30637
1970 12237 24906 5700 6962 8622 20468 30468
1971 12254 25534 6102 7066 10130 21930 30690
1972 12763 26264 6585 7922 11031 22358 31463
1973 12697 27426 7011 7152 12392 22480 32488
1974 12184 27740 7568 7264 12328 23005 31402
1975 12489 27350 7104 7149 13167 23008 30134
1976 12113 28241 7416 6741 13394 25051 31042
1977 12768 28268 7529 6489 13764 26562 31869
1978 12795 28704 7475 6129 14197 28757 32773
1979 13705 29191 7475 5833 14713 30047 32796
1980 13444 28725 8297 5423 15251 31070 31698
1981 13156 29481 8001 5352 16294 32071 32023
1982 12553 27733 7815 5326 16901 30767 30672
1983 12122 28376 7825 5259 17697 27971 31379
1984 12402 29980 7314 5098 18692 21974 33247
1985 12212 31147 7082 4726 17986 25529 33783
1986 13238 32037 7171 4683 18142 25222 34342
1987 14078 33196 7330 4819 19589 22461 35023
1988 14395 34521 7497 5046 21495 20928 36083
1989 14716 35069 7819 5178 23030 20130 36859
1990 34380 6898 5146 24369 19880 36771
Average 11441 26982 6496 5723 12657 22988 31009
Growth 118.9 76.5 67.0 18.6 386.6 17.6 50.5
75

Productivity & the Jamaican Economy (Update) Chain GDP Per Worker (I$) 1990 - 2000
Year Barbados Canada DR Ireland Jamaica Malaysia Singapore T&T USA
1990 26222 44744 10063 36727 8291 15951 37319 22444 53887
1991 26228 42745 9984 37148 7954 19719 36164 26821 52411
1992 27006 42238 10401 37955 7747 20579 35587 24362 53268
1993 26715 42608 10799 38751 7595 21671 37510 23910 53867
1994 27949 44164 11289 40872 7660 23060 36776 22744 55361
1995 28075 45021 11847 44791 7696 24800 39186 23553 56065
1996 29952 45304 12508 47977 7692 26113 43161 24278 57259
1997 31332 47156 14032 52077 7624 26841 20403 58981
1998 31616 48461 14618 55303 7531 26478 23187 60621
1999 31605 50526 15344 59736 7398 26255 26586 62400
2000 32962 52295 16173 65053 7310 27507 27018 64537
Average 29060 45933 12460 46945 7682 23543 37958 24119 57151
Period growth 6741 7552 6111 28326 -981 11556 5842 4574 10649
Period growth
(%) 26 17 61 77 -12 72 16 20 20
76

Productivity & the Jamaican Economy (Update) Chain GDP Per Worker (I$) 2000 - 2003
Year Barbados Canada DR Ireland Jamaica Malaysia Singapore T&T USA
2000 $29,178 $49,816 $15,009 $59,103 $9,073 $26,868 $58,750 $33,102 $67,079
2001 $28,012 $50,082 $15,591 $61,618 $9,131 $26,513 $54,418 $32,076 $66,616
2002 $27,827 $51,152 $16,273 $63,842 $9,090 $26,948 $54,994 $30,097 $66,788
2003 $28,191 $51,796 $15,572 $65,925 $9,025 $27,985 $54,304 $39,797 $67,865
Average $28,302 $50,712 $15,611 $62,622 $9,080 $27,079 $55,616 $33,768 $67,087
Period
growth -987 1,980 563 6,821 -48 1,117 -4,446 6,696 787
Period
growth (%) -3 4 4 12 -1 4 -8 20 1
77

Table 2: Annual average increase in real GDP per Worker, Selected Countries, 1960 – 1990 (1995
International Prices)
Year Barbados Canada DomRep Jamaica Singapore T & T USA
1961 5.37 -0.86 -3.75 0.67 4.33 8.72 -0.01
1962 8.54 3.80 19.27 2.95 2.99 -1.86 3.63
1963 -3.62 2.65 7.04 0.58 5.35 6.41 2.23
1964 4.17 3.76 5.28 10.26 -6.37 4.09 3.52
1965 9.34 4.17 -14.95 7.02 3.17 -3.22 4.69
1966 3.35 4.05 12.15 4.37 7.05 0.72 3.92
1967 11.15 0.64 -0.57 3.27 8.68 1.29 0.74
1968 4.99 2.91 -1.16 12.54 10.19 -5.58 2.80
1969 10.35 3.22 7.67 5.08 12.19 14.69 1.47
Period Avg. 5.96 2.70 3.44 5.19 5.29 2.81 2.56
1970 8.91 0.65 5.71 2.37 9.47 -4.16 -0.55
1971 0.14 2.52 7.05 1.49 17.49 7.14 0.73
1972 4.15 2.86 7.92 12.11 8.89 1.95 2.52
1973 -0.52 4.42 6.47 -9.72 12.34 0.55 3.26
1974 -4.04 1.14 7.94 1.57 -0.52 2.34 -3.34
1975 2.50 -1.41 -6.13 -1.58 6.81 0.01 -4.04
1976 -3.01 3.26 4.39 -5.71 1.72 8.88 3.01
1977 5.41 0.10 1.52 -3.74 2.76 6.03 2.66
1978 0.21 1.54 -0.72 -5.55 3.15 8.26 2.84
1979 7.11 1.70 0.00 -4.83 3.63 4.49 0.07
Period Avg. 2.09 1.68 3.42 -1.36 6.58 3.55 0.72
1980 -1.90 -1.60 11.00 -7.03 3.66 3.40 -3.35
1981 -2.14 2.63 -3.57 -1.31 6.84 3.22 1.03
1982 -4.58 -5.93 -2.32 -0.49 3.73 -4.07 -4.22
1983 -3.43 2.32 0.13 -1.26 4.71 -9.09 2.31
1984 2.31 5.65 -6.53 -3.06 5.62 -21.44 5.95
1985 -1.53 3.89 -3.17 -7.30 -3.78 16.18 1.61
1986 8.40 2.86 1.26 -0.91 0.87 -1.20 1.65
1987 6.35 3.62 2.22 2.90 7.98 -10.95 1.98
1988 2.25 3.99 2.28 4.71 9.73 -6.83 3.03
1989 2.23 1.59 4.30 2.62 7.14 -3.81 2.15
Period Avg. 0.79 1.90 0.56 -1.11 4.65 -3.46 1.21
1990 -1.96 -11.78 -0.62 5.81 -1.24 -0.24
Overall Avg. 2.84 1.88 2.03 0.86 5.52 1.06 1.39
78

Table 5: Unit Labour Productivity, Industrial Sectors, 1990-2001 (J$’000, 1996=100)
Unit Labour Productivity 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 Period Growth Annual Avg.
Agriculture, etc. 5.4 5.8 7.3 7.4 7.6 8.4 7.4 7.3 7.6 7.0 7.4 2.1 7.0
Mining 327.9 313.2 182.7 207.4 206.0 258.9 275.9 304.3 403.3 396.8 329.3 98.9 286.3
Manufacturing 33.9 34.3 34.1 36.9 33.5 32.0 34.1 36.0 37.4 41.1 48.1 14.7 36.2
Electricity, Gas, etc. 138.4 149.2 182.2 156.5 111.7 127.5 140.8 159.6 154.6 155.0 159.0 30.4 146.9
Construction, etc. 27.9 29.5 26.8 24.3 23.1 20.0 20.1 18.7 19.9 18.8 18.6 -11.6 23.2
Wholesale, etc. 20.7 21.1 19.9 19.2 19.9 20.2 21.0 18.8 19.0 19.2 18.9 -2.9 20.0
Transport, etc. 47.7 47.3 48.4 48.3 52.7 53.4 53.8 52.9 53.7 58.2 58.2 9.5 51.9
Financing,etc. 85.7 87.9 85.9 95.8 95.5 89.1 74.8 70.9 78.4 89.2 97.2 3.3 87.0
TOTAL 21.0 21.3 22.0 20.7 20.9 20.8 20.9 20.3 20.5 21.1 21.3 0.3 21.0
79

Comparative Labour Statistics (Mining Sector Benchmark) – 1975 - 2001
Unit Labour
Productivity ‘75 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Mining 1 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0
Electricity,
Gas, etc. 1.8 2.4 2.1 1.0 1.3 1.8 2.0 2.0 1.9 2.6 2.6 2.1
Financing,etc. 2.5 3.8 3.6 2.1 2.2 2.2 2.9 3.7 4.3 5.1 4.4 3.4
Transport, etc. 4.7 6.9 6.6 3.8 4.3 3.9 4.9 5.1 5.8 7.5 6.8 5.7
Manufacturing 6 6.9 9.7 9.1 5.4 5.6 6.1 8.1 8.1 8.4 10.8 9.7 6.8
Construction,
etc. 5 7.6 11.7 10.6 6.8 8.5 8.9 13.0 13.7 16.3 20.2 21.1 17.7
Wholesale,
etc. 7 10.6 15.8 14.8 9.2 10.8 10.4 12.8 13.1 16.1 21.2 20.7 17.4
Agriculture,
etc. 40 43.6 60.3 54.0 25.2 27.9 27.1 31.0 37.4 41.7 53.1 56.6 44.5
TOTAL 11.0 15.6 14.7 8.3 10.0 9.8 12.4 13.2 15.0 19.7 18.8 15.5
80

Factors Contributing to Jamaica’s Low Productivity
→ The broadest view of the labour market must be taken –
Leadership, Management and general workforce
Lack of Leadership
→ Lack of unity and direction (dissonance)
→ Lack of engagement of employees in problem solving
and identification of opportunities
→ In establishing equity
No Orientation to a Culture of Productivity:
→ Conceptualizing
→ Measuring
→ Researching
→ Applying
→ Living
In all spheres of economic endeavour
Lack of Appropriate Management Systems & Processes
→ Disunity (Splintering and diffusion of interests – too much
energy spent talking)
81

→ No guiding philosophies (e.g., Malaysia’s ‘Prosper thy
Neighbour’ policy)
→ Questionable ethics, in significant instances
→ Inefficient organization structures
→ Distanced leadership; animosity with labour
→ Debilitative compensation systems
High Proportion of Workforce Engaged in Low Productivity
Activities
→ Based on the disaggregation of sectors into high
productivity and low productivity, in January 2001 over
80% of the workforce was engaged in low productivity
activities.
A Jamaican State Enterprise
Changes in Staff Cost, Surplus & Productivity
2000-2004
60.00
% Change
40.00
20.00
0.00
-20.00
-40.00
2000 2001 2002 2003 2004
Surplus 47.83 -0.92 25.04 -12.12 25.97
Productivity 25.00 2.00 9.00 -21.00 -16.00
Labour Cost 18.64 20.89 17.13 20.43 21.63
Years
82

Low education & skill levels of workforce
→ As these low productivity activities do not necessarily
involve high-end technology and higher levels of
education and skills, then most workers are not equipped
with these.
High levels of Elementary Occupation
The workforce data also reveal that at January 2001 over
159,700 or 17% of workers were employed in elementary
occupation, thereby not requiring significant skills or
educational achievements
→ The figures for 2007, 2008 and 2009 are 173,000 (15%),
163,000 (14%) and 144,700 (13%)
Competitive Collective Bargaining System & Process
→ Too many bargaining units and in some instances, too
many unions to an establishment
83

Factors Contributing: Consistently high levels of income
inequality
Consumption by Decile
Consumption Ratios
Year 10th 9th 1st 2nd R10/P10 R20/P20 Gini Coefficient
1958 43.8 17.4 0.6 1.6 73.00 27.82 0.58
1975 33.3 16.9 1.3 2.8 25.62 12.24 0.45
1976 34.5 16.7 1.4 2.9 24.64 11.91 0.45
1977 35 17.7 1.3 2.8 26.92 12.85 0.46
1990 29.59 16.31 2.53 3.85 11.70 7.19 0.38
1991 31.42 15.7 2.22 3.59 14.15 8.11 0.4
1992 29.59 15.63 2.58 3.92 11.47 6.96 0.38
1993 28.86 15.98 2.42 3.88 11.93 7.12 0.37
1994 30.39 15.53 2.52 3.89 12.06 7.16 0.38
1995 29.15 15.59 2.94 4.17 9.91 6.29 0.36
1996 29.15 15.39 2.78 4.26 10.49 6.33 0.36
1997 32.3 16.8 2.2 3.6 14.68 8.47 0.42
1998 29.7 15.7 2.6 4 11.42 6.88 0.37
1999 30 15.9 2.4 3.9 12.50 7.29 0.38
2000 30.3 15.8 2.7 4 11.22 6.88 0.38
2001 30.2 15.8 2.4 3.8 12.58 7.42 0.38
2002 32 15.6 2.4 3.8 13.33 7.68 0.4
2003 30.3 15.8 2.7 3.9 11.22 6.98 0.38
2004 30.8 15.6 2.6 4 11.85 7.03 0.38
2005 30.3 15.6 2.5 3.8 12.12 7.29 0.38
2006 29.8 15.4 2.7 4 11.04 6.75 0.38
2007 29.5 15.5 2.7 4.1 10.93 6.62 0.38
84

Sources
→ (1) 1990 - 2008 Jamaica Survey of Living Conditions,
PIOJ & STATIN, 1997 and 2007,
→ (2) 1958 & 1975 - 1977 Banskota, Kamal, Johnson S.R.,
Stampley, Gary L. (Sept. 1987), Income Distribution in
Jamaica
→ Staff Report, Centre for Agricultural and Rural
Development, Iowa State University, Ames, Iowa
50011
Income Inequality and Labour Productivity
SUMMARY OUTPUT
Regression Statistics
Multiple R 0.85674069
R Square 0.734004611
Adjusted R Square 0.717379899
Standard Error 38845.3744
Observations 18
85

Year
Gini Coefficient
Unit Labour Productivity
(US$)
1975 0.45 279,390.17
1976 0.45 242,674.73
1977 0.46 223,468.59
1990 0.38 28192.5306
1991 0.4 16808.6137
1992 0.38 9358.45046
1993 0.37 8790.44781
1994 0.38 7029.09858
1995 0.36 6554.31239
1996 0.36 6323.01797
1997 0.42 6653.6977
1998 0.37 6322.107
1999 0.38 6037.04373
2000 0.38 5583.3502
2001 0.38 5264.24316
2002 0.4 4977.4639
2003 0.38 3863.63563
2005 0.38 3659.16251
86

The Way Forward
→ The country needs a social construct and contract,
beneficial to all and is developmental and sustainable
→ The labour market is in need of rationalization:
→ A more highly trained and skilled workforce
→ Higher participation of working-age population
→ Reduction of structural unemployment
→ More persons engaged high productivity jobs
→ More equitable distribution of income and reward
→ Need for a Performance Management Approach
→ Planning and agreeing the work to be done;
→ Monitoring the work being done against objectives or
work agreed;
→ Measuring the work done relative to objectives or work
agreed, and
→ Rewarding the work done according to agreement
87

An Actual Performance Based Payment System (DR, 1999)
→ Performance related pay systems are important and
gaining currency.
→ In one company the Executive Director, Finance Mgr. and
Programme Managers earn 67 -71% of their pay on
performance related bases.
PERFORMANCE PAY
AS PROPORTION OF TOTAL EARNINGS
0.8
0.714286
0.671302 0.671302
% O F TO TA L EA R N IN G S
0.6
0.4
0.2
Data A
0
EXEC. DIRECTOR FINANCE MGR PROGRAMME MGR
JOB POSITIONS
88

Examples of CEOs’ PAY STRUCTURE
Performance Pay Relative to Basic & Total Pay
June 1999
Proportion of Earnings
0.4
0.3
0.2
0.1
0
Performance Related Pay
Selected Positions & Enterprises
Group CEO
General Man
Financial Co
Barbados, 1999
HR Manager
Production
Marketing M
Sales Manag
Selected Positions
Accounts Cl
Executive S
Secretary
% of Total
% of Basic
89

Elements of performance payments are production incentives,
performance bonuses, profit sharing, share participation,
special awards such as dinners, paid holiday/special event
trips, non-monetary recognition and reward, etc.
These perhaps represent the best established cafeteria type
payment systems in the Caribbean. This is especially so at the
senior levels where incumbents and prospective employees are
allowed to negotiate the structure and nature of pay/reward.
Cafeteria type systems are not much in evidence in the
Caribbean, perhaps because they are very costly to
administer. An example from Cincinnati State Contract
AGREEMENT BETWEEN CINCINNATI STATE TECHNICAL AND
COMMUNITY COLLEGE AND SEIU/ DISTRICT 925, AFL/CIO, CLC:
Article 44
Cafeteria Benefits Plan
Effective September 1, 1996, the College shall provide a
"Cafeteria" style benefit plan, (the Cafeteria Benefits Plan per
the S.G. Donahue and Co. proposal) with the College
providing a predetermined amount of benefit dollars sufficient
for each eligible full time employee to "purchase" the following
90

enefits during the duration of the Contract:
1. the total cost of Choice Care health insurance coverage;
2. the total cost of the current dental plan coverage;
3. the total cost of vision plan monthly coverage as provided
by Vision Service
Plan (VSP) with coverage i.e., "flex dollars" of $10.40 for "single"
and $25.55 for "family" coverage.
4. the total cost of Employee Assistance Program;
5. the total cost of current short-term disability coverage for the
employee only; and,
6. the total cost of basic group life insurance coverage, for the
employee only, at 1 and 1/2 times annual salary with a
minimum of $25,000 coverage shall be provided for each full
time employee. This policy shall include an accidental death
and dismemberment rider.
The benefit dollars allocated to each eligible full time
employee will be sufficient to pay for the yearly premiums for
the above insurance based on either the single or family
coverage as eligible.
91

Should any 925 unit employee choose a total package of
benefits that exceeds the benefit plan dollars allocated i.e.,
Anthem (formerly Community Mutual) the 925 unit employee
must pay the difference through payroll deduction.
A 925 unit employee may revise his or her election upon a
change of family status in accordance with the terms of the
plan. 925 unit employees who waive coverage for which they
would otherwise be eligible will still receive the allocated health
care benefit dollars which he or she may use to purchase other
benefits or to receive the premium value in cash (paid biweekly).
An employee may not decline coverage in the
Employee Assistance Program.
Part time extended employees who are members of the 925
bargaining unit shall receive a pro rata share of the
aforementioned health benefit plan per the guidelines
established within the current Cincinnati State Technical and
Community College Employee Handbook.
Note: The "Cafeteria” style benefit plan described above is
based upon current Choice Care coverage, with the
exception of a change in prescription costs as mandated by
92

Choice Care. Members will pay $6.00 for prescriptions
effective August 1, 1996 instead of the current charge of $3.50.
All co-pays will remain as stated within the current Choice Care
"enrollee packet/enrollee handbook".
Performance Pay (Selected Positions) Barbados
December 2000
Percentages
60
50
40
30
20
10
Basic Salary Maximum
Basic Salary Median
Total Earnings Maximum
Total Earnings Median
0
GROUP CEO
GM
FC
HRM
OPERATIONS
MGR
MK'TING MGR
SALES MGR
SALES MGR
MIS MGR
Positions
93

Policy Requirements: Data Standardization
→ For the labour market to operate efficiently a
standardized system of data and information collection
and dissemination is necessary.
94

→ Standardization is required in respect to industry,
occupation, skills & competencies, etc.
Policy Requirements: Institutional Linkages
→ The principal local institutions and agencies that impact
on Jamaica’s labour market are as follows:
– Ministries of Labour & Social Security, Education,
Finance & Public Service and Industry & Commerce.
– Universities, HEART Trust/NTA
– The Planning Institute of Jamaica and the Statistical
Institute of Jamaica
– Jamaica Employers’ Federation
– Jamaica Confederation of Trade Unions
→ There needs to be a greater degree of cooperation and
collaboration between them, led by the government
Policy Requirements: Wage Negotiation and Collective Labour
Agreements
→ Wage negotiations are not usually conducted with the
utmost efficiency and urgency in Jamaica.
95

→ In many instances, as soon as one round of negotiation
concludes it is time to begin another round for the same
bargaining unit.
→ Collective labour agreements lasting three (3) or more
years could help to refocus the energies of management
and workers towards more productive endeavors.
→ Also, the amalgamation of bargaining units and trade
unions even, is definitely worth exploring.
Policy Requirement: Income Inequality
→ Through the Social Contractual process, a better
understanding of the importance of income and the
need for equity.
→ We take compensation for granted, when it can make or
break whole companies and economies
Too much time is spent negotiating, rather, haggling over this
matter
- End -
96

“Jobs for Growth: The Role of the Private
Sector”
Wayne Chen
President, Jamaica Employers’ Federation
Chairman and CEO of Super Plus Food Stores
97

The simple truth is that the Private Sector responds to and
makes its decisions based on the country’s macroeconomic,
regulatory and social environment as businesses and individuals
act in their own economic self-interest.
Therefore, policymakers have to ensure that planning for
specific developmental goals such as Vision 2030, and in this
specific case, the creation of jobs and economic opportunities
for our people and an efficient and competitive labour market,
recognizes the socio-economic reality of the majority of our
country’s people.
It is a given that the development of a competitive, efficient
economy will depend on a highly productive workforce,
among other factors.
So a key component in building a workforce that can drive a
prosperous, modern economy is education and training.
The question that therefore arises is: What are the skills and
competencies that we should train our people in?
Policymakers should note that Jamaica’s current workforce is
about 1.25 million of which about 145,000 are unemployed.
98

It should also be noted that the companies listed on the
Jamaica Stock Exchange combined have significantly fewer
than 100,000 employees or less than 10% of the employed
workforce. If one were to add all the large private companies,
the membership of the Private Sector Organisation of Jamaica,
Jamaica Chamber of Commerce, and so on, the percentage
would still be less than 20%.
Similarly, the combined membership of all Jamaica’s trade
unions is below 140,000. Again a relatively small number
compared to the overall workforce.
Employment in the Public Sector is under 120,000.
So while we the leadership of the Private Sector, Labour and
the State meet to make policy, we must be mindful that over
80% of the workforce are neither directly employed to us nor
are members of our organizations.
These are small businesses and self-employed persons, many of
them in the informal economy, who are responding to the
macroeconomic, social and regulatory environment in
whatever way they can and doing whatever they have to.
99

We have to also bear in mind that our national leaders are
“Baby Boomers” while the majority of the workforce is from
Generations X and Y.
The Generation Gap is real and even if our leaders could, and
many don’t, understand what drives Generations X and Y,
policymaking must be underpinned by a process that ensures
the input and participation of these generations.
The nature of the policymaking process that will be required to
meet the needs of future generations of Jamaicans can be
compared to the development of “Open Source” software i.e.
where many developers contribute to its continuous
improvement. The successes of the Linux and Android
operating systems are examples of this approach. The growth
and development of the successful on-line encyclopaedia,
Wikipedia, is another.
Recent developments have demonstrated that while there will
always be a role for “leaders” and “experts”, top-down
policymaking will not be as successful as a bottom-up
approach that responds to the market.
100

Simply put, the policymaking process must be inclusive,
responsive, and open to the input of the younger generation
who will be most affected.
The second point is that we must build on our strengths.
Jamaica has to recognize that there are areas that we will
never be competitive in such as the mass production of
widgets.
The story is often told of the Jamaican trade delegation that
visited a South Korean garment factory in the 1980s and was
impressed with how the women never even looked up from
their sewing machines as the Jamaicans passed by. Can you
imagine that level of discipline and focus in a Jamaican
factory?
Today most of that type of manufacturing takes place in China
as South Korea has moved up the value chain to high-tech
manufacturing and services, and as efficient as the Chinese
have been, they are now finding that competitors like Vietnam
and Bangladesh are stitching clothing at an even lower cost.
Jamaicans will never sufficiently subject ourselves to the
monotony and low wages that this type of mass production will
101

equire to be internationally competitive but there are several
areas where we have proven to be world-class.
Our workers in the hospitality industries, health care, education,
creative industries, especially music, and ICT (Business Process
Outsourcing), are among the best in the world.
Jamaican workers can be found in virtually every resort and
major hotel in North America. A similar story can be told about
Jamaican health care workers and teachers.
We are a cultural superpower as Jamaican music is performed
and played in every country on earth yet very few of our
schools offer the training and tools to develop these skills.
The fact is that we Jamaicans are a creative, warm people
who will be highly productive in areas that recognize and allow
us to show off our interests and strengths.
However we must also recognize that while some of our workers
are world-class, there are still far too many who are unskilled,
illiterate, innumerate and unschooled in the values and
attitudes needed for a productive workforce.
102

So in summary, we have to train our people in the technical,
conceptual, and social skills that will build on our strengths and
interests.
The process of developing this national policy and action plan
on education and training will have to be “open source” i.e.
responsive and inclusive.
Many individuals working in a free market have to play a role in
the development of the continuously developing product.
We may pick a few winners but policymakers will never
anticipate or predict all the economic opportunities and new
enterprises that will emerge from the minds of our
entrepreneurs.
Training our people in the appropriate technical, conceptual,
and social skills will make them even more trainable, and will
create the jobs and economic opportunities in new and
traditional enterprises built on a well-trained workforce.
The state must provide and facilitate the appropriate
education and training of our people, the private sector, large
and small enterprises, and individuals, will also train but more
important, generate the jobs and opportunities.
103

Where are the future job opportunities?
Hospitality
There has been a massive expansion in the number of hotel
rooms over the last five years especially by the new Spanish
hotels, the over US$200 million dollar development of Falmouth,
and the new Montego Bay Convention Centre open up
opportunities for new attractions.
For example, the town of Falmouth will be welcoming mega
cruise ships, each with over 5,000 guests plus crew, on a weekly
basis. These are people with dollars to spend who are looking
for goods to buy and things to do on shore.
Community Tourism offers other opportunities,
as many
travellers want to experience the “Real Jamaica” by
participating in activities that Jamaicans engage in. Creating
clean, orderly communities with will drive this development.
Jamaican nurses and doctors have a world-renowned
reputation and this can be leveraged into Health Tourism. India
104

has already become a major player in this sector and one
Indian group is already exploring a large development in
Cayman. Jamaica offers lower costs, a larger pool of trained
personnel, and other competitive advantages in this area that
need to be capitalized on.
Retirement Communities for English-speaking North Americans
are a fast developing area in Panama, Costa Rica, the
Dominican Republic and Mexico.
The aging U.S. and
Canadian populations suggest that the demand for safe,
affordable living in a warm, hospitable country with easy
access to good healthcare will continue to grow. Jamaica has
distinct advantages and needs to get on board.
Construction
There is a great need for infrastructure rehabilitation and
development. The improvement of Jamaica’s roads, housing,
sewerage, water supply, shoreline and reefs, and watersheds
will create jobs and improve the country’s economic
efficiency.
The US$400 million road programme planned for 2011, and the
other major housing and water supply projects will directly
105

employ thousands, but more important, will create many new
opportunities.
Agriculture
An efficient agricultural sector will need fewer workers in the
long term so if the goal is to maintain and create new jobs,
then policy has to facilitate the move to value-added
processing and branding.
Manufacturing
The mass-production of goods is not an area that offers much
potential for new jobs but the manufacturing sector can move
to specialized niches that require highly skilled workers.
Mining
A competitive mining sector will become more mechanized
and capital-intensive and will need fewer workers in the future
but there will be the need for high-level technical skills.
ICT/BPO/ Nearshoring
Becoming the business “back office” for North America offers
perhaps the greatest opportunity to create large numbers of
well-paid jobs for Jamaicans in the future.
106

There are several factors that have given Jamaica a unique
advantage in this area:
> Jamaican workers have proven to be excellent in sales
and other skills that can be outsourced.
> Jamaica has built a world-class telecom infrastructure
and there has been an over 80% fall in price to large
users over the last five years.
> Jamaica is an English speaking country that lies in the
same time zone as the USA’s Eastern Seaboard, the
time zone with the greatest concentration of wealth in
the world.
> Jamaica is an attractive place for North American
managers to live and work, it is easily accessible and it
is close to home. This is the advantage of
“Nearshoring” vis a vis “Offshoring”.
> Many North American firms have found that their
workers are most productive on the day shift and
where they can interact with their outsourced
counterparts during those hours, being in the same
107

time-zone gives Jamaica an advantage over India
and the Philippines.
Today there are 9,500 Jamaicans working in this sector and the
number has peaked due to a lack of available space.
The Dominican Republic started behind us but now has over
20,000 jobs and this number is rising.
We need to build the space in areas with large talent pools
such as Portmore, and make our people trainable.
Cultural Industries
In 1999 the worldwide sales of all recorded music, including
downloads, was US$38.6B, but by 2008 was only US$27.5B, a fall
of 25%.
This trend will continue for the foreseeable future.
Jamaican performers have never been overly dependent on
sales of recorded music the bulk of their revenue has come
from their live performances.
We have created several of the most important genres of
popular music, reggae, dancehall, ska and dub, and many of
the most important figures. Yet given the size of that market
and its universal nature, relatively few Jamaican performers
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make a living in the business. By comparison, the Philippines has
over one hundred thousand musicians, singers and dancers
working overseas.
One can find Filipino bands and artistes all over Asia and the
Middle East. In the Philippines many young people are trained
in the performing arts. They are schooled in every genre of
popular music, including reggae, and have created an
important industry.
Here in Jamaica only a small percentage of our schools offer
musical training so our potential remains largely untapped.
I believe that it is quite realistic to imagine a day some time
soon when thousands of Jamaicans will travel overseas to work
as performers on cruise ships, in resorts, and clubs as well as
improve and expand what is currently on offer to us and our
visitors locally.
Jamaica may never create another Bob Marley but there is no
reason why thousands of us shouldn’t be earning from our
musical legacy.
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Education and Training
Many Jamaican teachers have emigrated and established an
excellent reputation overseas.
There is an opportunity for
private schools and colleges to offer a high quality education
right here in Jamaica to an international clientele. St. George’s
University in the Eastern Caribbean that was sold for over
US$200 million a few years ago had originally sought to establish
itself in Jamaica but did not find a welcoming Government.
Today private colleges are a booming business in Jamaica. The
University College of the Caribbean is the most obviously
successful but there are many others. We need to create many
others.
There is an obvious and untapped market in the Jamaican
Diaspora where many families would like their foreign-born
children to be schooled and socialized in traditional Jamaican
values to counteract the negative influences that the public
school systems in North America and the United Kingdom seem
to offer. There is an opportunity here.
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Technology
The recent successes of the teams of young programmers from
the Northern Caribbean University in the prestigious Microsoft
Imagine Cup competition only hint at the potential talent that
resides in Jamaica in the area of software development.
Wide-scale training in this area would be a good investment by
any government.
Summary: The appropriate model for a prosperous future
The state and the private sector need to work closely together
to educate and train a productive and competitive workforce.
We must build on our strengths by developing the areas of
competence that we have already identified.
Education and training policy must be market driven by a
bottom-up, “open source” approach that ensures that it meets
the needs and interests of new generations of Jamaicans.
I know of no country that has educated its people and stayed
poor, and conversely, I know of no country that has failed to
educate its people and become wealthy.
An educated Jamaica will not remain poor.
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