Saturday, August 31, 2013

Unemployment in Cayman

Several of my blog-posts have criticised Cayman’s generally low educational standards, which are the consequence of a poor educational strategy. Two generations ago, the Islands’ political representatives seem to have been persuaded by the British Colonial Office (now the FCO) not to bother about the standards of all but the brightest of their fellow Caymanians.

Last February [Protection versus Education], I noted that the permanent affirmative-action program installed by the FCO negated the need for ethnic Caymanians to ever compete on equal terms with migrants and immigrants at any level. Foreigners’ expertise and qualifications would be trumped by the birthright entitlement of local bloodlines.

As long as an ethnic Caymanian was “adequately” qualified for a job – in the opinion of a committee of ethnic Caymanians – he or she must be hired or promoted or retained ahead of any foreigner. (Once, in the 1990s, the Immigration Board actually turned down the Work Permit of the Manager of the Bank of China. Beijing called in the British Ambassador, and the problem went away – but, crikey...!)

The policy explains the predominance in government jobs of ethnic Caymanians of doubtful ability, work-ethic, and international experience. In the private sector, the program has pushed and pulled native Caymanians to the top of the ladder in many fields of employment, regardless of their experience or competence. Some are properly qualified, some are not; it’s not always easy to tell, from the outside.

Newton’s Third Law of Motion states that every action generates an equal and opposite reaction. Private- sector employers don’t like to be ordered who to hire, promote or fire. Their reaction to orders was outlined in one of my very earliest blog-posts – Everybody’s Cheating, in December 2010. Corruption, intimidation, tokenism and quotas became embedded in our society. Resentment and contempt between expats and Caymanians are almost palpable in many workplaces. In private conversation, the hostility is evident.

An economic recession, aggravated by the British FCO’s recent decision to rein in Public Expenditure and the huge unfunded Public Debt, has generated 3000 registered unemployed Caymanian citizens (including immigrants), out of a local workforce of 25,000 or so. The foreign workforce is about the same size, split 50-50 between skilled and unskilled. (I’m guessing the figures; no reliable ones are available.)

So why can’t unemployed Caymanians replace 3000 of the unskilled foreigners? Bearing in mind our annual Education Budget of thirty or forty million dollars, how come there are any unemployed Caymanians? The answer is, that for all practical purposes they are unemployable. The combined weight of government disapproval, intimidation and legal sanctions cannot shift more than half a dozen of them.

The 3000 feel entitled to be supported without working. “It’s our Island. We’re the landlords. From Jamaican domestic servants and Filipino security guards on five dollars an hour, to British lawyers and Canadian accountants earning a hundred times as much, every expat sucks at Cayman’s teats. Let them pay for the privilege!

It could have worked, you know. Paying the ethnic-Caymanian community for their “birthright” could have worked. Fees paid by tax-haven clients could have been put aside into a special reserve fund and distributed to all native-born individuals and their descendants. Why wasn’t it tried?

Because the FCO clerks of the day didn’t think of it, that’s why. Civil Servants are all trained to think in terms of precedents. The Whitehall/Westminster system of governance was the model for our micro-legislature and micro-public-service hierarchy. The importation of indentured labour in post-slavery times was the model for the new Cayman tax haven.

With precedents in hand, the whole strategic plan for Cayman was probably devised one afternoon before a Bank Holiday weekend, and wrapped up in time for the FCO clerks to catch the 6.12 train home from King’s Cross and St Pancras. Done and dusted. Well done, Sir Humphrey!