American Samoa battles federal wage

A week or so ago, the 23rd Industry Committee from the US Department of Labor was in American Samoa listening to testimonies on plans to implement federal wage now before the US Congress which would increase it to $6.15 an hour by the Year 2000.

The committee heard the views of Starkist Samoa saying that it would have to layoff employees if wages go up in that it would simply deny the tuna industry its competitive advantage in the global market. A Starkist official related that American Samoa faces “a very competitive global industry that has forced other US plants to close down mainly due to labor costs”.

Samoa’s Congressman Faleomavaega testified before the committee that while he wishes to see employees paid more than they are making today, he equally noted that a high minimum “is of little value if there are no jobs”. He told the committee that it is “imperative that you take into consideration the economic and competitive conditions of American Samoa and ensure that what you recommend does not result in either a loss of jobs for our people or a loss of competitive advantage for our businesses”.

American Samoa is the only jurisdiction under the US that has an industry wage committee where wages differ from industry to industry. It has given American Samoa’s manufacturing sectors (garment and tuna) a strong competitive advantage in the global market.

A number of issues come into full view as we review American Samoa’s appeal for extra caution: 1). The potential loss of Starkist Samoa’s competitive advantage in the manufacturing of tuna products at the global market. 2). Such loss would eventually translate into job losses for it would force the closure of Starkist Samoa. 3). What good is high wages when the net result is job loss? 4.) The industry committee is federal law. Now, why can’t it be made equally applicable in the CNMI?

Suffice it to say, the apparel industry is the key economic engine today in the CNMI. Tourism has taken a heavy battering from the Asian contagion and has consistently headed south. The only thing that holds this industry’s competitive advantage are minimum wage which grants it the opportunity to compete at the global market because it produces high quality apparel products. It is not immune to the low cost of labor in nearby Asian countries and any increase would simply force closure and relocation. It provides combined jobs of over 3,000 in both sectors at a time when current investors have decided to downsize and aren’t hiring while the public sector considers work hour reduction or eventual reduction in force.

May I re-echo Congressman Faleomavaega’s statement when he told the industry committee that as it considers the wage issue, “it is imperative that you take into consideration the economic and competitive conditions of the (CNMI) and ensure that what you recommend does not result in either a loss of jobs for our people or a loss of competitive advantage for our businesses”. Furthermore, it should be understood that the CNMI’s set of economic conditions is far removed from what exist in the US mainland, therefore the obvious need to reconsider if it is justice to simply send us reeling into the sea of joblessness and helplessness. I personally believe this isn’t what my country stands for.

I dread the day when over 3,000 jobs are lost because of the blind agenda to impose federal hourly wage. In short, what good is $6.15 an hour when we can’t find jobs to earn a living? Perhaps our friends and foes can sit back and ponder the issue based on facts. This is all we ask for our benefactors across the Pacific. Si Yuus Maase`!