Characteristics Of The CNMI Labor Force And The Need To Control Immigration

Characteristics Of The CNMI Labor Force And The Need To Control Immigration

There has been much in the news of late relative to the opinion of some members of the United States Congress that U. S. immigration laws should be imposed on the Commonwealth. In considering this issue it is helpful to review the events that have transpired between 1990 and 1995 as regards the need for workers to staff the economy.

The number of workers in the islands increased by 8,758 persons or 33.7 percent between 1990 and 1995 for a total of employed work force of 34,723. Those workers born in Asia, of whom some are U. S. citizens, increased by 6,431 or 35 percent during the period for a 1995 total of 24,840. Those workers born elsewhere outside the Northern Marianas, of whom some are also U. S. citizens, increased by 38 percent or 1,066 for a 1995 total of 3,877. This growth occurred while those workers born in the CNMI increased by 1,261 or by 26.6 percent for a 1995 total of 6,006. Asian born workers now account for 71.5 percent of the Commonwealth’s work force. Except in rare cases U. S. immigration laws would prohibit entry into the CNMI of most alien workers. So the the question becomes – if U. S. immigration laws were imposed on the CNMI and the existing alien workers had to leave, from where would the replacement work force be derived to staff the economy; protect both domestic and foreign investment that has been established in the islands and generate the business profits from which tax revenues are derived to finance all manner of government services? Could employers recruit and retain the necessary workers to augment the limited supply of CNMI born workers from the United States and its territories? More than 25,000 would be needed.

One might legitimately ask, why not employ U. S. citizens from the mainland and elsewhere to staff the CNMI’s economy? The fact is that some of these people do come to the islands – and I am one of them, but a great many do not remain very long. Many people from large metropolitan areas on the U. S. mainland and elsewhere who move to the islands for employment reasons find adjustment difficult and do not remain long after their "initial" enthusiasm wears off. This is not meant to be critical of such people or the islands, it is simply a fact. Usually disenchantment of one spouse or the other is likely to result from one or more of the following: high cost of living compared with the United States particularly for food, rent and utilities; perceived limited medical facilities or educational opportunities; inability to adapt to a different environment; low wages and salaries compared with the mainland or limited employment opportunities for a spouse; the expense of moving household effects vast distances and the cost of reestablishing one's household; limited opportunities for professional growth; hot and humid climate; separation from family members on the mainland and the expense of returning for frequent visits; a service oriented economy that limits opportunities for some professions; limited cultural enrichment; no public transport; water shortages in some areas or special needs that cannot be met in the islands.

The above are some of the reasons people leave the islands after a relatively short period and return to the U. S. mainland with the result that the U. S. mainland is does not appear to be the source, or solution, for the island's work force that one might otherwise assume. In the past it has been Asia and primarily the Philippines to which island employers have usually turned. The nonresident worker is a valuable and indispensable element in the Commonwealth's "new" economy and it is indeed fortunate that the CNMI is in proximity to Asia with its surplus labor pool which can be tapped to augment the Northern Marianas limited indigenous supply of workers. To cite only one example of this need, it is a generally accepted industry "rule of thumb" that a full service resort hotel requires from 1 to 1.5 employees per room in the facility. Considering the 3,362 hotel rooms in the area, more than 3,500 hotel employees are required to staff this one industry alone. This does not consider the employees necessary to operate the remaining economic sectors of the islands. Had the CNMI not permitted the influx of nonresident workers, the small indigenous population and thus a limited human resource base would have served as an obstacle effectively "capping" the economy at the level of the late 1970’s early 80’s. Very little land would have been leased as there would be only a few local people available to develop projects which is the reason land was leased in the first place. The availability of imported workers helped Commonwealth land owners to create interest among outside investors in leasing their land. The population of those born in the CNMI increased by 3.2 percent over the five year period between 1990 and 1995 or by an average of 0.64 percent per year. Without considering in and out migration and the birth and death rate of this segment of the population and taking the above rate of growth as a basic factor, the Northern Marianas will not have a locally born population of a size sufficient to provide the 34,723 workers that were needed in 1995 until sometime around the year 2065. – or some 68 years from now.

Thus, a CNMI born population together with American citizen workers from the U. S. mainland, Hawaii and Guam are not, in my opinion, the solution to the matter of staffing the economy. Interestingly, the percentage of United States citizens in the CNMI relative to the total population has not changed in five years, it was 46 .3 percent in 1995 (27,208) and 43.2 percent in 1990 (20,082). One reason the Commonwealth was permitted control of its immigration was to avoid the possibility of being overwhelmed as a result of United States immigration quotas as applied to Asian countries. It was feared that immigrants entering the United States would select the new Commonwealth as a port of entry to the United States and very possibly a place of residence because of the island’s proximity to their home country. Since 1981, three and one half million people from Asia alone have immigrated to the United States according to the Visa Section of the U. S. Department of State. If only 5 percent, or 175,000 people, settled in the Commonwealth – there would be standing room only. The total population, including the indigenous would be around 234,000. Considering only immigration to the United States from Asia for the period 1981 thru ‘93, the ethnic composition of the Commonwealth would have changed radically if you except the premise that five percent of the total would stop off and remain in the islands. Using State Department ratios to estimate the ethnic mix, there could have been about: 37,200 Filipinos; 22,900 Chinese; 18,200 Koreans; 18,300 from India; 17,900 Vietnamese; 7,200 from Hong Kong; 3,600 Japanese and 49,700 from other Asian countries or a total of 175,000 people. Had U. S. immigration laws been applied in the Commonwealth it is also quite likely that by 1995 the indigenous population would comprise only 11 percent of the total population and would continue to decline as a percent of the total in future years. Some in the community point out that several major hotels in the Northern Marianas have expanded their facilities three times since their original investment. These observers reason that these hotels must have been able to amortize their initial investment in a relative short time and advance the opinion that since Guam and Hawaii pay the U. S. minimum wage – why can’t hotels in the CNMI do the same?

Both Hawaii and Guam have a large population base including, among others, retired military personnel and citizens of the Federated States of Micronesia and the Republic of Palau which select these islands as their first choices as employment locations and paid their own cost of relocating. Additionally, hotels in Guam and Hawaii own the hotel and land in fee simple and thus their investment appreciates in value as the future unfolds. In the CNMI the opposite is true as the major hotels do not own the land having, in some cases only leased it for 55 years with the result that the value of their assets decline as the lease term is eroded by time until they reach the end of the lease period with the result that there is no residual value.

While the housing allowance and meals for employees might be eliminated as the responsibility of the employer it seems to me that regardless of what the minimum wage in the Commonwealth might be – $3.05, $4.75, $5.15 or whatever – employers would still have the heavy costs associated with the recruitment of “off island” staff. These costs have been estimated at $1,355 per nonresident worker for the first year and about $355 per person for each year there-after. This is in addition to their regular salary.