In recent months, stakeholders in the private sector have suggested that Jamaica will need to increase the importation of labour as firms continue to find it difficult to acquire the skills they need. According to a recent World Bank Group diagnostic report of the private sector, approximately 84 per cent of Jamaican firms surveyed in 2018 claim that it is a “major challenge” to find labour with the requisite skills.

According to World Bank data, the net outflow of people (emigrants minus immigrants) from Jamaica was 146,934 in 1987, this figure declined over the years, amounting to 56,658 in 2017. This means that every year Jamaica is losing more accountants, administrators, bankers, carpenters, engineers, medical doctors, lawyers, nurses, plumbers, teachers, truck drivers, etc than is gained through immigration.

The labour market figures for the period January 2012 to January 2022 provide some context within which we can examine the situation. The unemployment rate is the first figure we look to as an indicator of what is happening in the labour market. The unemployment rate has fallen from 14.2 per cent (January 2012) to 6.2 per cent (January 2022); the youth unemployment rate fell from 33.2 per cent to 17.7 per cent for the same period.

Sceptics might question whether these low unemployment rates are truly indicative of the situation on the ground. To deal with these concerns we must first be clear about what is being measured. The Statistical Institute of Jamaica (Statin) uses the “relaxed” definition of unemployment. Individuals are defined as unemployed if they are 14 years and over and during the reference period satisfy the following two conditions:

1) Without work — not in paid employment or self-employment

2) Currently available for work — available for paid employment or self-employment during the reference period

There is a third condition which is applicable to the “strict” definition: the person must be “seeking work”. By removing this third condition Statin’s unemployment figures are higher than they would be under the strict definition.

Beyond the unemployment rate there are other numbers which further underscore what is happening in the Jamaican labour market. For the period January 2012 to January 2022 the overall population of Jamaica grew by 1.34 per cent; the labour force — the employed and the unemployed — grew by 4.6 per cent; the number of employed people in the labour force grew by 14.33 per cent; and people of working age outside the labour force fell by 4.06 per cent.

These figures indicate that the labour force grew by a larger percentage than the population, and more importantly, the number of employed people grew by a rate that is about three times the growth rate of the labour force. These numbers point to a situation in which the number of people wanting to work has grown and most of them have been able to find jobs or create jobs for themselves. Of course, these numbers do not speak to the quality of the jobs and the level of remuneration received.

The importation of labour has been touted as a short- to medium-term measure to alleviate the shortage of skilled labour. The importation of labour also includes the “reimportation” of labour, that is, the return of Jamaican workers who would have migrated.

For the period 2016 to 2021 Jamaica approved an average of about 5,000 work permits per year (see table). This number represents work permits given to new applicants and those already here in Jamaica. For the years 2016 to 2018 there were more new approvals than renewals. Not surprisingly, there was a drastic turnaround in 2020 and 2021 with renewals amounting to at least twice that of new approvals. Simply put, the novel coronavirus pandemic impacted the number of new applicants.

For the period 2017 to 2021, 57 per cent of total approved work permits (new and renewals) were given to Asians. On average, Chinese nationals account for 39 per cent and Indian nationals account for 14 per cent of total approved work permits. Additionally, about 60 per cent of approved work permits are for a one-year period.

The number of refused applications consistently amounts to less than one per cent of total applications received for any given year. Naturally, newer applicants are more likely to be refused than those seeking renewals. This low rate of refusal seems to suggest that firms wishing to import labour are not facing significant resistance from the Government of Jamaica.

Assuming that this is indeed the case, then other factors are working against the importation of more labour. For example, it must be a costly exercise to recruit labour, and remuneration packages might not be significant enough to attract the number of foreign workers needed. This could partly explain why approximately 80 per cent of approved permits (new and renewed) for the period 2017 to 2021 are for managers, professionals, technicians, and associate professionals. These are highly skilled workers, and so domestic firms are more willing to offer “decent” remuneration packages and engage in time-consuming recruitment exercises. Concerns about personal safety are also likely to drive up the remuneration package foreign workers will expect.

Work permits aside, an eligible Caricom national can work in Jamaica with a Caricom Skills Certificate. For the period 2018-2021 an annual average of 46 Caricom Skills Certificates were issued to non-Jamaican nationals by the Ministry of Labour and Social Security.

Given the thousands of Jamaicans who migrate every year, the importation of about 3,000 workers is certainly not filling the gap, a gap which is growing wider. Without supporting data, it is not unreasonable to assert that many of the foreign workers who come to Jamaica do so temporarily; in some cases, Jamaica is a “launch pad” for further migration to other countries, such as the US and Canada. On the other hand, most Jamaicans who migrate do so permanently or for a significant period which allows them to build up enough wealth for retirement in the warmth of Jamaica.

The importation of labour is not only an economic issue, there are also social issues which need to be given careful consideration. Surely, the welfare of Jamaicans must be of primary importance to Jamaican policymakers.

Dr Samuel Braithwaite is a lecturer in the Department of Economics at The University of the West Indies, Mona. Send comments to the Jamaica Observer or braithwaitesamuel@gmail.com.