Overall economy shrinks in 2009
We’re not as rich as we used to be
in the Cayman Islands, according to the 2009 Annual Economic Report compiled by
the government statistics office.
But the report identified some
reasons for optimism among the local workforce, according to Premier McKeeva
For the calendar year 2009, the
country’s total labour force fell by nearly 3,000 workers – largely due to a decline
in the number of foreign workers compared to 2008.
By contrast, the Caymanian
percentage of the local labour force grew by nearly 500 people, making
Caymanians the majority in the country’s labour market.
“This is the first time in four
years that Caymanians accounted for at least half of the labour force,” Mr.
Bush told the Legislative Assembly on Friday.
But don’t break out the bubbly just
Cayman’s per capita income in 2009
fell by nearly 5 per cent. The average salary here in 2009 was $44,197,
compared to $46,409 in 2008, the economic report showed.
Overall unemployment also continued
to grow, reaching 6 per cent in 2009. The number of unemployed Caymanians had
reached 1,790 by late 2009, the Economics and Statistics Office found.
Worse, Cayman’s gross domestic
product was estimated to have contracted by some 6.6 per cent in 2009; the
aggregate economic performance was the lowest in any year since 2005 – just
after Hurricane Ivan devastated the country. “The country is not in a happy
condition,” Premier Bush said, urging members of the House to do everything
they could to assist Cayman’s economic growth in the coming year.
Projections for the remainder of
2010 are that the Cayman Islands’ economy will continue to decline, but it is
expected to pick up again in 2011 with positive growth.
In 2009, nearly every major
economic sector in the country declined when compared to 2008. Most notably,
stay over tourism dropped by more than 10 per cent in 2009, and the financial
services sector – which accounts for 54 per cent of Cayman’s gross domestic
product – declined by 4 per cent.
Real estate, renting and business
activities fell by nearly 5 per cent in 2009, while the construction industry
experienced a major drop off in available work. New building permits decreased
by 29.3 per cent, according to the statistics office report.
Far fewer imports are making their
way to Cayman’s shores, as tonnage of imported cargo fell by 36 per cent in
2009, compared with what was brought in during 2008. If there was any silver
lining in the economic clouds, it was that consumer prices fell slightly – by
1.3 per cent – last year. However, economists did not view that as a positive
for overall business growth.
The report stated that the price
decline could be traced mainly to the contraction in the local economy “which
influenced firms to employ cost reduction strategies which caused reductions in
the labour force, which, in turn, impacted domestic demand”.
The number of work permits issued
during calendar year 2009 fell by 11.3 per cent.
“Our immigration policy also had
direct influence on the contraction of the economy,” Mr. Bush said.