Guam's economy continues to decline
by Nick Delgado
Guam - What is the state of the island's economy? The chief economist for the Bank of Guam appeared before island Rotarians this afternoon to answer that very question. Asked his thoughts on not Guam's economic status, Joseph Bradley said, "Not very good. We had 13.3% unemployment in March; that was measured the day after the earthquake and tsunami in Japan and so any layoffs that took place after that point in time were not picked up in that unemployment statistic."
A severe reversal of fortune is what Bradley, the Bank of Guam's chief economist, is calling the island's current economic situation. During today's Rotary meeting he said he was optimistic things would change, but that was the day before the disasters in Japan. Bradley says only 750 jobs were added to the Guam market in the last three years and just over 1,900 in the last ten years. "The economy here is flat compared to last year, but it's gradually going down again."
He says everyone's bottom dollar is tight and for the past nine months he estimates Guam has seen a 5.5% drop in tourism as compared to the previous year. He also says the global economic weakness persists for other areas like Japan, Korea and China. "We need to do several things, one is we need to find additional industries for Guam, tourism and the military and has been very good for our economy but those are both kind of unreliable," he noted, adding. "Guam has a construction driven business cycle, and the more rebar I see rolling north on Marine Drive on flatbed trucks, the better the economy's doing. Six months ago I saw quite a bit, but recently I haven't seen any."
He adds a lot of what's at issue is the uncertainty with the funding anticipated from the military buildup. But with the decline in revenue, Bradley also cautions residents of the potential increase in the cost of living. "One of the important things to keep in mind is over the course of the last week or week in a half petroleum prices have increased by 12%, that means that everything here might go up not just gasoline but everything that gets shipped in as well as a lot of the things that are grown or manufactured some place else all include energy cost," he said.
Bradley says there may be relief coming our way, but only temporarily. "There's going to be a shot in the arm when this bond issue goes out and some tax refunds are paid but, I think that's temporary and may last through middle or towards end of next year but if something else doesn't happen before then such as spending some of the over eight hundred million in Japanese money sitting in treasury for military projects in Guam, then we can expect a continuation of more of the same," Bradley said.