BUSINESS CONVERSATIONS ON LABOUR SHORTAGE

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1 BUSINESS CONVERSATIONS ON LABOUR SHORTAGE A View From the Distribution Sector Prepared by Balliram Maharaj September 27 th 2013 Presented By Rene Seepersadsingh

2 Historical Background Trinidad and Tobago The transition from an agricultural to an oil based economy resulted in the transformation of much of the population from a rural to an urban one Declining agricultural production together with a large differential between the salaries offered in the agricultural sector as against the energy sector marked the beginning of the labour crisis that the country faces today Information released by the National Agricultural Marketing and Development Corporation (NAMDEVCO) supports this view NAMDEVCO STATS For the period , the cocoa and coffee industries experienced an 88% and 98% decline in production respectively caused by, among other factors, an inadequate supply of labour

3 Current Issues and Trends Confronting Labour in Trinidad and Tobago The success of Trinidad & Tobago s economy and the rapid growth of the service sector as a result is not uncommon globally. However, unless the industry can provide a satisfactory service to customers it will negatively impact on this growth. Citizens are now widely exposed to service and expect and demand it. The growth in overseas travel, interaction with foreign nationals and relatives living abroad, wider television viewership and programs promoting service and the higher level of education and incomes are fueling this expectation. These trends are being exacerbated by the growth in the adoption of the internet by Caribbean nationals and an increasing trend towards mobility.

4 Current Issues and Trends Confronting Labour in Trinidad and Tobago In other countries having this experience, many of the entry level and supervisory positions, have been filled by the persons who have gone through formal industry training programs before being given employment and through a migrant labour force. We must be proud of our success but plan carefully to ensure its sustainability. In the US and Europe for example you would be hard pressed to find an employee in the service sector such as the hospitality industry and retail who has not completed some basic certification in the sector or is not from another country.

5 Current Issues and Trends Confronting Labour in Trinidad and Tobago STATISTICS MINISTRY OF FINANCE Statistics published by the Ministry of Finance revealed that in 1999 the country s total labour force comprised 0.56 million persons. CENTRAL STATISTICAL OFFICE Q , the total labour force now stands at 623,500 persons Notwithstanding this apparent expansion of the labour market over the past thirteen years and government s claims that the country is nearing full employment, there still remains a significant paucity of skilled labour in Trinidad & Tobago. This challenge is being experienced particularly in the non energy economy and includes businesses such as wholesale/retail, supermarkets, healthcare institutions, restaurants, hotels, franchises and even factories.

6 Current Issues and Trends Confronting Labour in Trinidad and Tobago Social issues, particularly among the youth, such as increases in domestic dysfunction, crime, drug abuse and school drop-out rates have all combined to foster a national climate of low productivity and attainment of the maximum benefit for the minimum output. Various employers have expressed concern that potential candidates interviewed for jobs lack even the most basic literacy and numeracy skills. Stigmas related to agriculture, hospitality, service, textile, manufacturing and other labour intensive industries have plagued Trinidad and Tobago for decades and adversely affects the ability of the country to really be able to compete on a regional and international level. This has been perpetuated by Government programs.

7 Current Issues and Trends Confronting Labour in Trinidad and Tobago Ads for workers in various spheres and levels remain unanswered for lengthy periods of time as some candidates prefer to seek employment in Government sponsored social programmes such as the Unemployment Relief Programme (URP) or the Community-Based Environmental Protection and Enhancement Programme (CEPEP) where above average wages are paid despite low productivity. Among the results of this existing labour shortage are: poor work ethic, low on the job performance, high absentee rates and rapid employee turnover. The low population growth rate in Trinidad and Tobago, emigration of skilled persons in search of more lucrative opportunities as well as the fact that free education is now available from the nursery to the tertiary level all contribute in varying degrees to the country s existing labour crisis.

8 What is encouraging anyone to stay in Trinidad and Tobago and what is encouraging those that have the opportunity to be educated abroad to return and share their knowledge? Current Issues and Trends Confronting Labour in Trinidad and Tobago Unskilled and uneducated labour leaves non-equipped job seekers unable to seek employment at any level therefore ensuring that they become dependent on the state and relying on the Government Sponsors programs. The manufacturing sector has experienced negative growth, contraction of employment and a decline in its contribution to overall employment and national output. Brain drain (or human capital flight) is also a major factor which exacerbates the challenges associated with lack of population growth and a lack of talented skilled and knowledgeable workers at all levels on a national platform.

9 Key Training Needs There is a need for Trinidad and Tobago to introduce educational and skills-training programmes to enable workers to meet the demands of the constantly changing environment. In addition, technical and vocational institutions require restructuring to make them more relevant to the needs of labour markets. A more proactive approach is needed at a national level to the development of the basic skills and competencies required in order to support economic growth and diversification. Additionally, government may wish to consider expanding the curricula of secondary level education to offer a wider range of courses in business studies, information technology, clothing and textiles, and industrial arts. Diversification brings an increased demand on our resource base to be able to perform and to compete at an international level. The mere fact is that Trinidad and Tobago, a player in the Oil and Gas/Energy Sector should have already set forth on this path.

10 Key Training Needs The government of Trinidad & Tobago has continued to offer significant educational opportunities including free education but little focus has been on entry level certification of employees in the services and distribution sectors. This must be considered as a part of the official employment criteria in this sector. However it cannot be realistically considered if access to minimum training is not widely available and at little or no cost to potential employees. It should therefore be part of the governments programs not dissimilar to what is being offered to thousands of persons seeking higher education through the gate program for example.

11 Recommendations to the Government of Trinidad and Tobago Government, in conjunction with the major stakeholders who are being affected by this chronic lack of labour, may wish to consider reexamining Trinidad and Tobago s existing immigration regulations with a view to facilitating the increased importation of labour in critical areas. Additionally, in recognition of the important role that small and medium-sized enterprises play in creating jobs, government, may wish to consider forming strategic partnerships with international and multilateral institutions, with an objective to introducing a diverse range of programmes and mechanisms, including tax breaks and subsidized credit, aimed at promoting the development of these enterprises.

12 Recommendations to the Government of Trinidad and Tobago At the Caricom level, many countries have also signed Protocol II to the Treaty of Chaguaramas, which seeks to establish free movement of labour, capital and businesses. However, labour movements are still limited because many countries still have trepidations about allowing the free movement of people within the sub-region. To this end government may wish to consider introducing measures aimed at increasing labour-market flexibility in the short, medium and long term.

13 Recommendations to the Government of Trinidad and Tobago In the short term government may wish to consider increased flexibility around allowing Caricom nationals to work within Trinidad and Tobago in areas such as agriculture, distribution, tourism and hospitality. In the longer term, government may wish to consider programmes such as those being offered by countries such as Canada and Australia which both offer working while on vacation programs and have bilateral agreements with a multitude of different countries worldwide.

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