24 Jun 2011

Minimum wage increase report finds economic decline in American Samoa and CNMI

7:02 am on 24 June 2011

A report on the federally mandated increases in minimum wages in American Samoa and the CNMI has concluded the economic decline in both US territories is substantial.

The US General Accountability Office report says both territories now face budget shortfalls that may threaten their ability to fund public services and invest in future economic development.

The report says employment in American Samoa fell 19% from 2008 to 2009 and 14 percent from 2006 to 2009.

Tuna canning employment fell 55 % from 2009 to 2010 due to the closure of Samoa Packing and layoffs at StarKist Samoa.

The report also contains a letter from American Samoa Governor Togiola Tulafono which states that employment losses and economic decline in the territory are greater than the report suggests and constitute an economic depression.

The governor recommends wage hikes in American Samoa be terminated immediately.

He says a thorough analysis should be conducted into why adverse economic effects of the wage increase were greater in American Samoa than in the United States.