The U.S. departments of Labor and Interior posed 13 sets of questions for Gov. Eloy S. Inos before deciding on his request to extend the Commonwealth-only worker program, or CW, beyond Dec. 31, 2014. Both the government and the private sector said that without the five-year extension, the CNMI will immediately lose access to some 12,000 workers it needs to help run its tourism-based economy.
Inos, in his response, cited both progress and challenges in hiring U.S. workers, mostly for private sector jobs held by foreign workers.
He cited training of skilled and unskilled U.S. workers using federal funds and millions in local funds invested in education and scholarships.
On the other hand, the governor cited seven reasons why there is lower U.S. worker participation rate in the private sector, including “low wages,” “hostile environment,” and “few or no benefits such as life insurance and medical coverage.”
Inos also cited “food stamp dependency, public sector employment offers more attractive benefits, inflated qualifications for entry-level positions, and part-time instead of full-time position.”
Press secretary Angel Demapan, when asked for comment, said there is no indication yet whether the CW program would be extended.
Delegate Gregorio Kilili C. Sablan (Ind-MP) earlier said that even if the U.S. Secretary of Labor grants an extension beyond 2014, it may not necessarily be for five years, at least initially.
Inos and Sablan, along with the private sector, have been hoping for an early decision on the CW program extension request to give ample time for employers, workers, and the government to prepare should an exodus of foreign workers were to happen.
The governor said it is premature to derive an anticipated workforce growth over the next five years, when asked about it, along with the percentage of the anticipated CNMI workforce growth that will be met by foreign workers during the same period.
“With a cursory assessment from our side, it would be hard to gauge the actual growth as the population and education of the non-U.S. citizens in the workforce outweighs the current U.S. citizens,” the governor said.
Some of the U.S. Labor and Interior questions included:
“For which occupations or educational skills do the CNMI’s businesses have current needs?”
“What efforts by the CNMI government have been undertaken to adequately train or educate CNMI citizens to assume jobs held by alien workers? Who will carry out training and educational programs? What is the result of these efforts? Have they been successful? Will they be continued?”
“Do foreign workers in the CNMI pay income tax?”
On the latter question, the governor’s response was “yes.”
“Given the recent changes in the CNMI economy…what strategies are being developed by the CNMI government to adapt to these changes which will make the CNMI a more vibrant economy?”
“Is the unemployment rate in the CNMI based on both resident and foreign workers?”
“If the transition period ends, do employers think they will use existing worker visa programs (e.g. H2B, H2A etc) more? If not, why not?”
When asked about CNMI government strategies to adapt to economic changes, the governor broke down his response to four areas: human capital development, industrial and commercial development, physical development, and preservation.
Under human capital development, for example, the governor said the CNMI government continues to invest in education and training of its workforce.
He said there is greater focus on labor enforcement or ensuring at least 30 percent qualified U.S. workers participation.
The term “U.S. workers” refers to U.S. citizens, U.S. lawful permanent residents or “green card” holders, certain CNMI permanent residents, and Freely Associated States citizens such as those from Palau, Marshall Islands, and the Federated States of Micronesia (Pohnpei, Yap, Chuuk and Kosrae).
Inos said the CNMI is focused on enhancing the tourism industry, including assigning the Marianas Visitors Authority to head a task force to identify opportunities and coordinate with all other agencies to protect the visitor industry.
The governor said the CNMI has invested $20 million in the Saipan Higher Education Financial Assistance to avoid “brain drain” and $2 million in CNMI Scholarship for fiscal year 2012 alone, when asked about government efforts to educate CNMI citizens to assume jobs that alien workers currently hold.
Inos met last week with the Saipan Chamber of Commerce, and asked for their input in addressing questions posed by U.S. Labor and Interior before deciding on the CW extension request.
In turn, the Saipan Chamber of Commerce solicited responses also from the Hotel Association of the Northern Mariana Islands and CNMI Chapter of the Society for Human Resources Management.
One of the questions was, “Do CNMI’s businesses have any difficulty finding qualified applicants who are U.S. citizens and legal residents for any of the jobs they are trying to fill?
The governor said there is difficulty for higher skilled jobs, but for entry-level or low skilled jobs, “maybe.”
“Cases are unique and Labor enforcement is key and this is one of the CNMI’s employment strategies in response to U.S. Public Law 110-229, ensuring qualified U.S. workers are accorded the opportunity for employment,” he said.
Inos said the demand from businesses continue to be for highly-skilled and experienced employees, and “defaults to their current non-U.S. citizen employees.”
The governor also listed six local and federal research and surveys to understand the economic implications of the possible elimination of the CW program, including a report by the Government Accountability Office and a 2008 McPhee & Conway Report.
Inos also said the implementation of minimum wage increases creates less demand for labor for smaller businesses whereas for larger businesses, “the demand is there; however the increase has resulted in lesser work hours to remain sustainable with considerable expenses such as utilities.”