3 Feb 2014

Minimum wage hikes burdensome on American Samoa

7:55 am on 3 February 2014

The chair of the American Samoa Chamber of Commerce says mandated wage hikes are turning off potential foreign investors and are a huge burden on the economy.

The governor has asked the Commerce Department to come up with a living wage for local workers and prepare a justification package requesting Congress permanently remove it from the automatic minimum wage hikes.

Lewis Wolman says it's difficult to attract foreign investors because minimum wages are high compared to elsewhere in the region and it creates uncertainty.

Mr Wolman says imposed wage hikes were a major reason that the territory lost one of its two tuna canneries in 2009, and with it 2,000 jobs.

"We have thousands of people working at today's minimum wage and they are not leaving the island which they could, either to return to their homeland if they're from outside of American Samoa, or to emigrate to the United States. So clearly for thousands of workers, working for the minimum wage in American Samoa is better than the alternative."

Lewis Wolman.

American Samoa's next minimum wage hike is scheduled for September next year.