Question of Bajans and productivity
Are Barbadians really lazy and hate to work? Is this the major reason why Barbados is facing a problem of declining productivity, and is not as competitive in relation to other countries?
From listening to people formally and informally discussing national issues, there seems to be a lot of people, including employers and public policymakers, who are of that view.
This perception probably explains why some employers are showing a seeming preference for hiring foreign workers over Barbadians. Foreign workers, so they say, demonstrate an eagerness to work much harder than Barbadians and for less pay in some instances. Isn’t the same said about immigrants everywhere?
Is it a fair accusation that Barbadians are lazy and don’t like to work? Maybe in some cases, as obtains just about everywhere else, but definitely not across the board. Barbadians have a strong tradition and reputation for working hard and being resourceful. If it weren’t so, Barbados certainly could not have achieved such a remarkable level of transformation in the last 50 years.
The many outstanding achievements have made Barbados a much admired development model for other countries, especially within our region, and a highly desirable place to live and work for people from around the world. However, Barbadians, like workers everywhere else, are today facing complex challenges brought on by a changing and inherently hostile environment shaped by globalization.
Against this backdrop, the reason for declining Barbadian productivity, often mentioned as a major concern by Government and private sector officials, cannot be simply explained by citing laziness and an unwillingness to work. It calls for a much deeper analysis which must focus on probing the reasons why people choose to work in the first place.
This decision is always informed by an expectation of receiving a satisfactory level of benefits to materially improve their lives –– in other words, self-interest or the crucial “what’s in it for me?” or “what do I stand to gain?” question that generally informs human decisions and serves as a motivation for human action. It stands to reason, therefore, that the greater the benefits, the harder people will be inclined to work.
There are a lot of disgruntled workers in Barbados today. This general dissatisfaction is the underlying cause of the increasing level of labour unrest we have witnessed in recent years. Workers feel they are being taken advantage of by employers, whose focus seems primarily to be on the bottom line –– how much money they can make –– whilst overlooking the important human factor that makes businesses successful.
As for being lazy, many workers are saying they feel as if they are working much harder but not reaping benefits as before, because life generally has become a struggle to make ends meet. In the circumstances, it is unlikely that people will be inclined to give of their best, or go the extra mile. They will only do what is necessary. Such is the reality of human nature.
The need for workers to demonstrate higher productivity is because globalization –– or more specifically the liberalization of markets –– has created an environment where countries are forced to compete fiercely with each other in the quest for economic success. As a result, the performance of the Barbadian worker, even though he or she may not be conscious of this reality, is measured today in relation to the output of workers in competing countries, even though conditions may be fundamentally different.
Productivity has a direct correlation with a country’s competitiveness which plays a critical role, for example, in attracting investment and increasing exports. Both are important for achieving high levels of economic growth on which the success of every country heavily depends. It is important, therefore, that our workers develop an awareness of this new reality; and it is the responsibility of Government and the trade union movement in particular to do so. How much they have contributed to improving workers’ understanding of these issues is open to debate.
Government’s high taxation policy to support what is widely agreed to be a woefully inefficient system of public administration also serves as a disincentive to higher productivity. As it stands, most Barbadians feel they are working not so much to achieve a better life for themselves and their families, but essentially to support an inefficient Government that has impositions on almost everything.
As a result, there are Barbadians who deliberately choose to limit how much they will work in any given year to reduce their tax liability. There are Barbadians too who avoid working overtime under any circumstances because, for years now, the complaint has been that doing so is not worth the effort because the taxman takes too much of the extra income.
These choices underscore the point made earlier that human beings are driven by the “what’s in it for me?” factor, and that if they are unable to clearly see the benefits, the motivation simply will not be there. Effectively addressing the productivity issue must take this into consideration. As long as Barbados continues to be perceived as a heavily taxed country, and workers question the benefit of working harder, the problem will remain.
If I were giving advice to a political party on the kind of policy prescriptions it should adopt to address the productivity problem, I would propose sweeping reform of the tax system. Of course, this would have to be done following a comprehensive study to ensure that the availability of financing to meet the critical needs of the country was not in any way compromised.
Governments over the years have tinkered with the tax system, but none seems to have ever given serious thought to abolishing income tax. As it stands, the payment of income tax is limited to people within the formal sector. However, Barbados has a growing informal sector or parallel economy where thousands work and pay no income tax.
Income tax, therefore, has become discriminatory in its application because it covers only people in the formal sector. No Government that I am aware of has been successful in bringing workers in the informal sector within the tax net. Abolishing income tax, therefore, seems to be just the thing to do.
In its place, VAT could be raised to 20 per cent and considerable resources could then be devoted to ensuring its efficient and prompt collection.
People in the informal sector cannot escape VAT. Like workers in the formal sector, they too are consumers of goods and services. Allowing people to take home all they have worked for, minus the deduction for national insurance, would do wonders for boosting productivity; because persons, in the quest for greater material benefit, would be eager to work a lot more since they would clearly see what is in it for them.
Economics is not only about the application of land, labour, capital and entrepreneurship to satisfy human needs and generate growth. Equally as important, it also requires an understanding of human behaviour to make decisions that will cause people to respond in a way that supports the achievement of key objectives.
Taking this approach is key to solving the productivity problem.
(Reudon Eversley is a political strategist, strategic communication specialist and journalist.