Labor Commissioner Albert Bryan updated the Committee on Education and Workforce Development regarding local unemployment, federal funding, training programs for residents and other issues Wednesday at the Earle B. Ottley Legislative Hall.
Bryan confirmed the unemployment rate is still “in the teens,” although lower than 2012. In December 2013, unemployment ran 13 percent – down from 13.3 percent in December 2012.
The Virgin Islands unemployment skyrocketed from 8.7 percent at the beginning of 2012 to a high of 13.9 percent in October 2013, according to the Department of Labor website. Most of the unemployment can be attributed to the closure of the Hovensa refinery in January 2012.
Challenges for the department include the dwindling unemployment trust fund that owes a loan payment of $1.4 million in September, Bryan told the committee.
In 2013, $39 million was paid to unemployed workers, Bryan said. And because the U.S. Congress discontinued extended unemployment benefits for 1,300 V.I. residents, additional financial stress has been added to the system.
The “most pressing concern” is workers’ compensation, Bryan testified. The program is understaffed and premiums need to be increased, he said.
Bryan told Sen. Shawn-Michael Malone it costs $14,000 from the workers’ compensation fund to get an injured worker off-island in addition to the medical care.
Senators had questions about funding, grants, job programs, workers compensation and job creation.
Bryan said he hopes to add a .5 percent tax to raise $8 million for the unemployment insurance fund. A $25 surcharge has already been imposed on members of the Chamber of Commerce.
The 2013 goal of the Labor Department was to develop and protect the workforce and to provide support and programs. The system served more than 12,000 people last year, Bryan said.
Some of the 12,000 included laid-off Hovensa workers. Almost $4 million of a $7.8 million federal emergency grant for dislocated Hovensa employees has been used, he said.
About 400 refinery workers left the island right away and, of the 1,400 remaining employees, 500 took classes and 1,376 were provided training and other services. A total of 422 were hired for local jobs, Bryan said.
The remaining $3.8 million of the federal grant will be unavailable after Thursday, due in part, to low interest in training classes.
More than 11,200 people used a major Department of Labor tool, the V.I. Electronic Workforce System, last year to research resumes, to attend web seminars and to access resume writers and other services, according to Bryan.
Entrepreneurial programs through Labor include small business training and developing web-based businesses. Bryan said that some funding still is available for business owners through the V.I. Economic Development Authority and some participants can collect unemployment while they set up their businesses.
Responding to a question from Sen. Myron Jackson, Bryan said 15 to 20 people took advantage of the small business entrepreneurship program. Some online vendors now are selling hot sauce and T-shirts, and another is repairing jewelry at home.
“The future of our economy will rely on small business and access to the Internet,” Bryan said.
Bryan talked about the Diageo Distillery bartending and culinary training program that was, he said, especially successful on St. Thomas. Diageo, “a stellar corporate partner,” Bryan said, pays for everything except transportation and food. The Labor Department find students and Diageo find jobs for graduates.
“If you’re going to be in a service economy surfacing in the nation, you’re going to have to go back to school and get a degree or an advanced degree,” he said.
Job programs, training and scholarships are available for youth as well as adults. Bryan said that by 2018, 63 percent of the work force will need a college degree.
Bryan also reported on the Labor Investing for Tomorrow program, now in its 25th year, which provides summer internships for college juniors, seniors and graduate students, and said other summer job opportunities are available for youth through the Labor Department. Programs can be accessed through Youthnet on the department’s website.
Attending the hearing were Malone, Jackson, Committee Chairman Donald Cole, and Sens. Janette Millin Young, Judi Buckley and Diane Capehart.