Paul McWeeney was responding to the latest Central Bank Quarterly Economic Review (March 2003), which says the number of Bahamians employed in the sector fell by 73 (1.7 per cent) to 4,227.
This is compared to a gain of 77 (1.8 per cent) to 4,300 in 2001 and average annual job growth of 107 (3.4 per cent) in the five years ending 2001, the bank reported.
According to Mr. McWeeney, managing director of Bank of The Bahamas International, The Bahamas needs to find ways to create industries or sub-sectors within these industries to provide adequate employment.
“The way to look at this is not in the context of the financial-services industry in isolation but in the context of the entire economy,” Mr. McWeeney told The Guardian on Wednesday. “The ideal situation is that if there is a fall-off in one industry, another industry is expanding.”
Other sources noted that over the past two years, 300-350 jobs are estimated to have been lost of the 4,000-plus in the financial sector because of closings or cutbacks at a number of offshore banks.
With the average salary in the financial sector about $40,000, this translates in lost salaries of approximately $12 million.
In its report, the Central Bank reminds financial institutions that all public banking and trust licencees operating from or within the country must establish a staffed, physical presence by June, 2004.
“Unless their operations are managed by a public licensee with a physical presence, restricted operations must also meet this requirement,” says the bank.
It adds that a significant number of managed licencees have decided not to satisfy this requirement and have had their licenses terminated, causing a marked reduction in the number of licensed operations for the second consecutive year, to 301 in 2002 from 356 in 2001 and 410 in 2000. Licensed public banking and trust operations fell by 38 to 189 and restricted non-active operations, by 17 to 112.
The bank says that while the reduction in licensees had less marked effect on employment, the physical presence count, which affects staffing, declined to 203 from 221.
However, some recovery is expected this year, as approximately 43 of the remaining managed operations are in the process of converting to physical presence.
Notwithstanding, restructuring activities among domestic banks caused a decline in employment during 2002, while scaled-backed capital programmes explained a sizeable decrease in expenditures.
The bank confirms that after increasing steadily at an annualised rate of 3.9 per cent in the five years through 2001, banking-sector employment decreased by 63 (1.4 per cent) to 4,523 persons in 2002.
The transition to physical presence among managed international banks and trust companies provided marginal job gains at senior levels, with expatriates employment rising by 10 (3.5 per cent) to 296 in 2002, augmenting the 49 positions added in 2001.
“As a result, the share of jobs held by non-Bahamians rose slightly, to 6.5 per cent from 6.2 per cent in 2001, with a corresponding marginal decrease in the share of Bahamians,” the bank says.
Caption: PAUL MCWEENEY, president of the Bahamas Institute of Financial Services.
Source: The Nassau Guardian
