2024 Minimum Wage Advisory Committee

Foreword
This report is presented to the Minister of Financial Services, Labour and Trade, Hon Lorna Smith OBE, on
behalf of the Minimum Wage Advisory Committee.
As the Coordinator of the Advisory Committee, I submit this report to highlight the urgent need for aminimum wage review in the British Virgin Islands (Virgin Islands). This review is both timely and essential,
considering the evolving economic conditions and the necessity to ensure that wages are appropriate andfair in relation to our current economic environment.
The Virgin Islands' economy, primarily driven by tourism and financial services, exhibits uniquecharacteristics that necessitate a careful approach to wage adjustments. The significant contribution ofthese sectors to our GDP and employment highlights the need for a balanced wage policy that supports
sectoral growth and worker welfare. In this context, we consider the minimum wage adjustment not justas a matter of economic policy but as a crucial element of social equity and sustainability.
The current minimum wage, established several years ago (2016) at $6.00 an hour, is increasingly
considered inadequate given the rising cost of living, particularly in housing, food, and essential services.
The Committee has observed that a segment of our workforce struggles to meet basic needs, an issue
that not only affects individual dignity and security but also impacts productivity and economic vibrancy.
This review process involved consultations with stakeholders across all key sectors: employees,
employers, interest group representatives, and decision-makers. The Committee has analysed data on
employment patterns, inflation trends, living costs, wage structures, and public opinions within the Virgin
Islands. The Committee has made regional comparisons with similar economies. This comprehensive
approach ensured that the recommendations were well-informed and aligned with the realities of oureconomy.
After careful consideration, the Committee recommends an increase in the minimum wage. This strategy
is designed to balance the urgent need to improve workers' living standards with the necessity forbusinesses, particularly small enterprises, to adapt to rising labour costs in a manageable way. Carefully
implementing the increase will also enable the Government to monitor the impact methodically andadjust the approach based on the economic outcomes observed and feedback from both the business
community and workers.
Moreover, we recognise the Virgin Islands' economic vulnerability to external shocks, such as fluctuationsin global financial markets or shifts in tourism trends. Therefore, our recommendations include
establishing mechanisms to review the minimum wage regularly, ensuring it remains responsive to global
economic conditions and local economic health.
The Committee also suggests supporting measures and training programmes to increase worker
productivity and business readiness. These measures aim to mitigate the impact of wage increases on
employment and promote a more skilled workforce, thereby enhancing the overall competitiveness of
our local economy.
In conclusion, the proposed adjustments to the minimum wage, complemented by strategic support
measures, represent a forward-thinking policy designed to cultivate a fair, equitable, and prosperous
economic environment in the Virgin Islands, provided they are implemented with careful consideration.
By enhancing support for our workforce and ensuring that every citizen can live with dignity and security,
while enabling businesses to grow without undue burden, we establish a foundation for sustained
economic growth and social stability.
1

2024 Minimum Wage Advisory Committee

This report represents a consensus view of the Advisory Committee, informed by extensive research andcommunity engagement. The Committee believes these recommendations provide a balanced andsustainable pathway forward, addressing immediate needs, while planning for long-term prosperity.

Nelda Farrington
Chairperson
Minimum Wage Advisory Committee
30th April, 2024

2

2024 Minimum Wage Advisory Committee

Executive Summary
This comprehensive report analyses the minimum wage adjustments needed in the British Virgin Islands(Virgin Islands), considering the socio-economic conditions, labour market dynamics, and extensive
stakeholder engagements. The economic landscape of the Virgin Islands, primarily driven by tourism andfinancial services, is highly susceptible to global economic shifts. Since the last review in 2016, significant
changes in local and global economies have necessitated a reassessment of the minimum wage to alignwith the current economic realities.
The Virgin Islands is at a crucial juncture in its economic development. As a small, evolving economy
primarily dependent on its main pillars, it faces unique challenges and growth opportunities. One of themost pressing challenges is the escalating cost of living, which has risen sharply compared to wage
increases, especially in vital sectors such as housing, healthcare, and consumer goods. These sectors are
essential for the basic well-being of the population, and the rapid increase in costs in these areas, without
commensurate wage growth, has led to significant financial burdens for many families.
Low-income workers, who form a part of the workforce, are particularly vulnerable to these economic
pressures. The widening gap between earnings and living expenses has reduced their purchasing power
and limited their access to necessary services and adequate housing. This situation is worsening socioeconomic disparities within the territory, contributing to a cycle of poverty that could be difficult to break.
The increasing financial strain is not merely a personal issue for these workers and their families but abroader economic concern highlighting the urgent need to adjust the minimum wage to a more realistic
standard. This adjustment is crucial not only for improving the living standards of low-income earners, butalso for promoting general economic stability and maintaining social cohesion.
The socio-economic analysis indicates that the current minimum wage does not correspond with the highcost of living, given the territory’s reliance on imported goods and a labour market concentrated in theservices sector. Furthermore, external economic influences, such as fluctuations in global tourism andfinancial sectors, continue to impact the economic resilience and labour market conditions of the Virgin
Islands.
The territory is witnessing a significant discrepancy between the cost of living and wage growth,emphasising the pressing need for wage adjustments to align with the rising prices of essential
commodities and services. This imbalance strains household budgets and risks wider economic and social
repercussions. As the cost of living increases, wages have stagnated, leaving workers struggling to meetbasic needs, diminishing their quality of life, and potentially fuelling social discontent.
A comprehensive regional analysis that benchmarks the Virgin Islands against comparable economies
reveals that the Virgin Islands' minimum wage is lagging. This discrepancy is particularly significant given
the islands' reliance on sectors such as tourism and financial services, which demand a skilled andcommitted workforce to thrive. The current lag in minimum wage rates not only impacts the economic
well-being of workers but also poses a strategic disadvantage for the territory in the broader regional
marketplace.
The ability to attract and retain skilled labour is critical for maintaining high service and operational
efficiency standards, which are vital for the sustained growth and success of the Virgin Islands’ primaryeconomic sectors. For the tourism industry, the quality of service directly affects the visitor experience
and, by extension, the industry's reputation and revenue generation. In the financial services sector,
skilled professionals ensure compliance, efficiency, and innovation, which is essential for attracting
international business and maintaining the Virgin Islands’ status as a competitive financial hub. Hence,32024 Minimum Wage Advisory Committee

the Virgin Islands need to reassess and adjust its minimum wage structure to align with regional standards
and ensure the territory remains attractive for talented professionals.
Stakeholder consultations and surveys conducted across the Virgin Islands have highlighted a broadconsensus among employers and employees that the current minimum wage does not adequately reflect
the cost of living. This shared view underscores the pressing need for an adjustment to ensure that wages
are both fair and sustainable. Employees report that their wages are insufficient to cover daily living
expenses, eroding their purchasing power and overall quality of life. This sentiment is echoed acrossvarious sectors, demonstrating widespread concern about the wage gap.
On the other hand, employers, particularly from small and medium-sized enterprises (SMEs), areapprehensive about the financial implications of a minimum wage increase. They worry about thepotential rise in operational costs, such as higher payroll expenses, which might compel them to either
increase the prices of goods and services or, in a more drastic scenario, reduce their workforce to maintainprofitability. This is a significant concern for SMEs, which often operate on tighter budgets and are lessequipped to absorb sudden increases in costs compared to larger corporations. Such changes could strain
their operations and impact their competitive edge in the market, potentially leading to closures orlayoffs. These dynamics illustrate the delicate balance that must be achieved in adjusting the minimum
wage, ensuring it supports workers' needs without jeopardising the viability of businesses crucial to the
local economy.
The comprehensive data analysis of this review has meticulously examined several key aspects of thelabour market. By assessing employment trends, insights into job creation and loss dynamics acrossvarious sectors and identifying patterns that may influence future labour market resilience, were gained.
The analysis of wage distribution has helped map out the current landscape of earnings, revealing where
wage disparities are most pronounced and how they correlate with living standards and economic sectors.
Moreover, evaluating the potential economic impacts of wage adjustments has been particularly critical,
considering the immediate need to increase incomes but also the potential repercussions for businesses,
especially regarding operational costs, pricing strategies, and employment stability.
These analytical efforts aim to strike a careful balance between enhancing worker welfare and maintaining
economic stability. The goal is to propose a set of well-rounded recommendations that accommodate theneeds of workers for a fair wage that matches the cost of living; while also considering the economic
realities that employers face, such as the need for financial viability and competitive operation. Thisbalanced approach fosters a sustainable economic environment supporting employment growth andsocial equity.
Several options for adjusting the minimum wage: no change, minor increase, moderate increase, andsubstantial increase. Each option has different potential impacts on employment, business costs, and theeconomy. After careful consideration, the moderate increase option emerges as the most balanced
approach, offering significant improvements in living standards without drastically destabilising business
operations. This assessment is supported by specific assumptions about economic stability and is subject
to limitations and delimitations. The potential for rapid changes in the global economic environment andthe inherent challenges in projecting long-term economic impacts pose notable limitations to our analysis.
While a moderate increase in the minimum wage minimises negative impacts, it still carries risks, such asincreased operational costs for businesses and potential inflationary pressures. These risks necessitate
careful consideration in the implementation of any wage adjustment policy. To mitigate these risks, werecommend a series of strategic measures, including Government’s support for small businesses, regular42024 Minimum Wage Advisory Committee

economic assessments to keep wage adjustments in line with economic conditions, public education on
financial management, and enhanced training and skills development programmes for workers.
In conclusion, this report recommends an increase in the minimum wage from $6.00 an hour to $9.00 anhour to improve workers' economic well-being while maintaining the economic stability andcompetitiveness of the Virgin Islands. This approach, underpinned by supportive government measuresand continuous stakeholder engagement, will help ensure that the benefits of wage adjustments are
realised across all sectors of the economy. Adopting these recommendations will require a collective
effort and a shared commitment to fostering an inclusive, equitable, and prosperous economic
environment in the Beautiful Virgin Islands.

52024 Minimum Wage Advisory Committee

Summary of Stakeholders' Views
Insufficiency of the Current Minimum Wage: Stakeholders universally agreed that the current minimum
wage of $6.00 per hour does not meet the needs of workers, given the high cost of living in the Virgin
Islands.
Socio-Economic Challenges for Various Family Structures: Families, particularly those with dependents
and single individuals, face significant financial difficulties, often relying on the Government’s social
assistance, which risks becoming unsustainable with increased demand.
Impact on Small Businesses: There is considerable concern among small business owners about theeconomic repercussions of minimum wage increases, fearing that substantial raises could threaten theviability of small enterprises and destabilise the economy.
Capital Outflow through Remittances: Some stakeholders are worried about the potential for increased
remittances leading to capital outflow from the territory, which could undermine local economic stability.
High Cost of Living: The high cost of living, particularly housing, was a central issue. The escalating rental
prices significantly strain workers’ finances and contribute majorly to living expenses.
Phased Minimum Wage Increase: Stakeholders advocate for a systematic increase in the minimum wage
to better align with the cost of living and alleviate financial pressures on workers.
Introduction of a Rental Cost Index: There is a strong recommendation for creating a rental cost index tomonitor and manage the rising housing costs.
Enhancing Trade Relationships: Improving trade policies and relationships to allow consumers access toa broader range of competitively priced goods.
Re-evaluation of Port Charges and Shipping Costs: Stakeholders call for re-evaluating port charges,
particularly container surcharges, to reduce the high costs contributing to the territory's inflated prices.
Increase in Tax Break Threshold: A proposal to raise the tax exemption from $10,000 to $15,000 for
minimum wage earners to provide them with more disposable income and alleviate financial stress.
Strengthening Retail Monitoring: There is a push for more robust monitoring of retailers to prevent pricegouging and ensure that minimum wage increases translate into real economic benefits for workers.

6

2024 Minimum Wage Advisory Committee

Summary of Recommendations
The following recommendations were considered in balancing the immediate need to improve workers'
living standards and to facilitate the adjustment of higher labour costs without significant disruptions.
1. Minimum wage recommended increased from $6.00 to $9.00 an hour.
2. Establish a regular review mechanism for the minimum wage to ensure it remains aligned witheconomic conditions and cost of living changes. This will allow for timely adjustments in response
to local and global economic shifts.
3. Develop tailored strategies for sectors more significantly impacted by minimum wage increases,
such as tourism and retail. This could involve specific support measures to ease the transition andmaintain competitiveness.
4. Introduce support measures to help small businesses adjust to increased labour costs without
reducing their workforce.
5. Invest in training and development programmes to enhance worker productivity. This supports
higher wages and contributes to the overall competitiveness and efficiency of the local economy.
6. Implement a comprehensive monitoring and evaluation framework to assess the impacts of theminimum wage increase. This will provide valuable feedback and data to guide policy decisions
and adjustments.
7. The minimum wage be reviewed in the next 5 years.

72024 Minimum Wage Advisory Committee

Summary of Recommended Risk-Mitigating Strategies
The following are recommended mitigating strategies that can be adopted by employees, employers andthe Government in managing potential risks associated with a minimum wage increase:
1. Employees:
a. Skills development, where employees pursue training and upskill opportunities toenhance employability in a potentially shifting job market.
b. Improve financial literacy to manage potential increases in income and navigate economic
adjustments effectively; andc. Actively participate in discussions with employers and governmental forums to ensure
their needs and views are considered in wage policies.
2. Employers:
a. Reassess and innovate business models to maintain profitability under higher labourcosts, possibly through technology investments or market expansion.
b. Maintain open communication with employees about how wage changes will impact thebusiness and discuss potential organisational measures openly; andc. Conduct detailed financial analysis to explore cost management strategies that avoid
significant workforce or employee benefits reductions.
3. The Government:
a. Implement programmes and systems to facilitate and support relief, particularly to small
businesses, to help them adjust to increased wage expenses.
b. Conduct regular economic reviews to adjust the minimum wage promptly andappropriately in alignment with economic conditions, andc. Encourage and conduct public awareness and education programmes.

8

2024 Minimum Wage Advisory Committee

Table of Contents
Foreword....................................................................................................................................................... 1
Executive Summary....................................................................................................................................... 3
Summary of Stakeholders' Views.................................................................................................................. 6
Summary of Recommendations.................................................................................................................... 7
Summary of Recommended Risk-Mitigating Strategies ............................................................................... 8
SECTION 1: FOUNDATION ........................................................................................................................... 12
Introduction ............................................................................................................................................ 12
Understanding the Need for Review ...................................................................................................... 13
Objectives of the Minimum Wage Review ............................................................................................. 13
Legal and Regulatory Frameworks .......................................................................................................... 14
Minimum Wage Advisory Committee..................................................................................................... 15
The composition of the Committee .................................................................................................... 15
Terms of Reference ............................................................................................................................. 15
Assumptions, Limitations, and Delimitations ......................................................................................... 16
Assumptions ........................................................................................................................................ 16
Limitations........................................................................................................................................... 16
Delimitations ....................................................................................................................................... 17
Method ................................................................................................................................................... 17
Methodology........................................................................................................................................... 18
Understanding the Terms ....................................................................................................................... 19
SECTION 2: LITERATURE REVIEW IN THE CONTEXT OF THE VIRGIN ISLANDS............................................. 20
International Labour Organization’s View on Minimum Wage .............................................................. 20
Impact of Minimum Wage on Employment ........................................................................................... 20
Wage Elasticity and its Implications for Employment ............................................................................ 21
SECTION 3: SOCIO-ECONOMIC ANALYSIS ................................................................................................... 22
Economic Analysis ................................................................................................................................... 22
GDP Growth ........................................................................................................................................ 23
Financial Services ................................................................................................................................ 24
Tourism ............................................................................................................................................... 25
Inflation ............................................................................................................................................... 26
Small Business Considerations ............................................................................................................ 28
Sector-Specific Impacts ....................................................................................................................... 28
92024 Minimum Wage Advisory Committee

External Economic Influences ............................................................................................................. 29
Labour Market Conditions ...................................................................................................................... 30
Analysis of the Labour Market Segmentation .................................................................................... 30
Unemployment Rate ........................................................................................................................... 32
Employment ........................................................................................................................................ 33
Earnings ............................................................................................................................................... 35
Employment-to Population Ratio ....................................................................................................... 37
Labour Force Participation Rate ......................................................................................................... 38
Standard of Living, Cost of Living and Living Wage Analysis ................................................................... 39
Standard of Living ............................................................................................................................... 39
Cost of Living ....................................................................................................................................... 39
Living Wage ......................................................................................................................................... 41
Living Wage Basket ............................................................................................................................. 42
Cost of Living Effect ............................................................................................................................. 42
Social Considerations .............................................................................................................................. 43
The Role of Minimum Wage in Reducing Poverty and Income Inequality ......................................... 43
Gender and Age Considerations in Minimum Wage Policies ............................................................. 43
SECTION 4: SELECTED REGIONAL COMPARISONS ...................................................................................... 45
Sectoral and Regional Analysis ............................................................................................................... 45
Differences in Cost of Living, Productivity, and Economic Conditions ............................................... 45
Regional Comparisons............................................................................................................................. 46
Review of Minimum Wage Policies in Other Countries ...................................................................... 46
Lessons Learned and Best Practices.................................................................................................... 51
SECTION 5: STAKEHOLDER CONSULTATION ANALYSIS ............................................................................... 52
Stakeholder Perspectives ........................................................................................................................ 52
SECTION 6: RESULTS OF FINDINGS ............................................................................................................. 54
Employees ............................................................................................................................................... 54
Employers ............................................................................................................................................... 56
SECTION 7: MINIMUM WAGE ADJUSTMENT .............................................................................................. 58
Option Analysis ....................................................................................................................................... 58
No change option ................................................................................................................................ 58
Minor increase option......................................................................................................................... 58
Moderate Increase .............................................................................................................................. 58
10

2024 Minimum Wage Advisory Committee

Substantial Increase ............................................................................................................................ 59
Calculation Options ................................................................................................................................. 60
SECTION 8: IMPACTS OF MINIMUM WAGE ................................................................................................ 63
Economic Impact..................................................................................................................................... 63
Sector-Specific Impacts of Minimum Wage Adjustments .................................................................. 63
Social Impact ........................................................................................................................................... 64
Impact on Living Standards and Social Welfare .................................................................................. 64
SECTION 9: RISK .......................................................................................................................................... 65
Employment Impact ................................................................................................................................ 65
Increased Costs for Consumers............................................................................................................... 65
Competitiveness Concerns...................................................................................................................... 65
Informal Economy Growth...................................................................................................................... 66
Adjustment Period for Businesses .......................................................................................................... 66
SECTION 10: APPLICATION .......................................................................................................................... 67
Technological and Innovation Considerations ........................................................................................ 67
Opportunities for Innovation in Monitoring and Enforcing Minimum Wage Compliance ..................... 67
SECTION 11: RECOMMENDATIONS AND CONCLUSION.............................................................................. 69
Recommendations .................................................................................................................................. 69
Conclusion ............................................................................................................................................... 71
SECTION 12: REFERENCE ............................................................................................................................. 72
Document References............................................................................................................................. 72
Website References ................................................................................................................................ 72
SECTION 13: APPENDICES ........................................................................................................................... 74
Appendix 1: Term of Reference .............................................................................................................. 74
Appendix 2: Minimum Wage Committee Questionnaire Employer ....................................................... 78
Appendix 3: Minimum Wage Committee Questionnaire Employee ...................................................... 79
Appendix 4: Living Wage Basket ............................................................................................................. 80
Appendix 5: Minimum Wage Employee Survey Results ......................................................................... 81
Appendix 6: Minimum Wage Employer Survey Results.......................................................................... 96

11

2024 Minimum Wage Advisory Committee

SECTION 1: FOUNDATION
Introduction
As a small island economy, the Virgin Islands faces unique economic challenges and opportunities,
particularly in balancing its labour market dynamics with broader economic policies. Given these realities,
the importance of minimum wage in the Virgin Islands' economic policy must be stressed, as it directly
impacts the standard of living for its residents, influences employment patterns, and interacts with the
Territory's economic growth and competitiveness.
While compensation for work is essential, the ability of every employee to meet their needs is critical totheir rights. As such, the last minimum wage adjustment was on October 1, 2016, moving from $4.00 per
hour to $6.00 per hour. From that increase, minimum wage workers realised an improved standard ofliving for themselves and their families. However, the changing economic dynamics since 2016, including
the impacts of internal and external shocks, created the need to revisit the minimum wage structure andmake recommendations as to whether or not the wage should be revised and to what level.
Implementing a minimum wage policy in the Virgin Islands to address the need for sustainable economic
growth is a fundamental tool for poverty alleviation and social equity. A well-structured minimum wage
in the Virgin Islands can ensure that workers in low-paid sectors receive a legal wage, reducing income
inequality and enhancing the overall quality of life. This new wage is particularly significant in the Virgin
Islands, where the cost of living can be high due to the Territory's reliance on imports for goods andservices, and other factors. By setting a wage base, the Government can ensure that basic systems are fairand equitable.
Moreover, the minimum wage policy has implications for the Virgin Islands’ labour market andemployment conditions. While there are concerns that setting the wage too high could lead to reduced
employment opportunities, especially among small businesses and in sectors like tourism, construction
and services essential to the Virgin Islands' economy, careful consideration and sector-specific analyses
can provide insights into the best option. The policy must strike a balance that encourages job creationand economic growth without imposing undue burdens on employers and employees.
From an economic development perspective, a minimum wage can incentivise productivity andinvestment in human capital. By ensuring that workers are fairly compensated, businesses may see
benefits in the form of higher employee morale, lower turnover rates, and increased productivity. Thesebenefits, in turn, can stimulate economic activity and growth. For the Virgin Islands, which is keen on
diversifying its economy beyond financial services and tourism, such policies can support broader
economic strategies and innovation.
The setting of a minimum wage in the Virgin Islands may consider the competitive landscape of the
Caribbean region. It is important to consider aligning the minimum wage with those of neighbouring
islands to maintain the Virgin Islands’ attractiveness as a destination for both businesses and workers.
Competitive wage policies can help the Virgin Islands attract skilled labour and investments, contributing
to its reputation as a premier financial hub and tourist destination, while ensuring that the benefits ofeconomic growth are widely shared among its residents and through other economic areas.

Hence, reviewing and setting the minimum wage in the Virgin Islands involves a comprehensive approachthat includes stakeholder engagement, economic and labour market analysis, and considerations of global
economic trends. It requires a deep understanding of the relationship between wages, employment, andeconomic growth, tailored to the unique context of the Virgin Islands. By adopting an evidence-based and122024 Minimum Wage Advisory Committee

inclusive approach to the minimum wage policy, the Virgin Islands can foster a resilient and dynamic
economy that benefits all its citizens.
In this context, the minimum wage policy review in the Virgin Islands is not only a labour market tool but
a strategic component of the Territory's broader economic and social policies. It highlights the territory's
commitment to fostering a balanced and equitable economic development that prioritises its workforce's
well-being, its businesses' competitiveness, and its economy's sustainability.
Thirteen sections form part of this report. Section 1, the Foundation, sets out the context for the review,
the objectives, legal and regulatory framework that supports minimum wage, the structure and mandateof the Minimum Wage Advisory Committee, Assumption, limitations and delimitations with the review,
the approach to completing the assignment, and a definition of key terms. Section 2 discusses theliterature review in the context of the Virgin Islands. Section 3 highlights the Socio-Economic context,
including the economic analysis, the labour market conditions, social considerations, and the sectoral andregional analysis. Section 4 highlights regional comparisons of selected economies. Section 5 presents astakeholder analysis. Section 6 presents the results of the data-gathering exercise. Section 7 posits theminimum wage adjustment. Section 8 calls attention to the impact of minimum wage implementation.
Section 9 discusses the risk associated with the minimum risk adjustment. Section 10 presents theapplication of the wage and consideration of technological and innovative integration. Section 11 contains
the recommendations and conclusion. Section 12 highlights the references, while section 13 presents theappendices.

Understanding the Need for Review
Following the adjustment of the minimum wage in 2016 from $4.00 to $6.00 an hour, a trio of catastrophic
events in 2017 disrupted the normal performance of the labour market. The results of this shock saw anincrease in the cost of living as the demand for goods and services rose in response to the recovery efforts.
While prices rose, employees' salaries remained relatively constant, increasing financial pressures on
workers as they sought to care for themselves and their families.
Following the recovery phase was the commencement of the development phase as a direct means ofstimulating economic activities and creating growth opportunities. It was not long until a global pandemic
sent shock waves across the globe with the birth of the COVID-19 virus, which was declared a pandemic
in 2020, bringing supply and demand shocks. Additional financial burdens on workers emerged, and theincrease in social services became more evident. Three years after the pandemic, some workers still findit challenging to meet the basic needs of their families.
In its quest to bring some relief to households and keeping in line with best practices, the Ministry of
Financial Services, Labour and Trade has engaged an Advisory Committee to review the Territory's
minimum wage policy.

Objectives of the Minimum Wage Review
The objectives of the minimum wage review centred around addressing the immediate and long-term
needs of the Territory's workforce, employers, and the broader economy. At the core, the review sought
to examine the current minimum wage and provide advice on whether or not the wage should be revised
and, if so, what the new minimum wage should be for the Territory. The review also sought to examine
whether or not the minimum wage should be set at the same level for all employees or whether theminimum wage should be set by category of employees. The objectives involved enhancing workers' living
13

2024 Minimum Wage Advisory Committee

standards and maintaining businesses' financial viability to ensure fairness, sustainability, andeffectiveness.
The review aimed to assess the adequacy of the current minimum wage for workers in the Territory. The
review involved examining the cost of living-related reports and other studies to understand thedependence on minimum wage to meet basic needs without undue financial strain while uplifting thestandard of living for low-income workers and their families, thereby reducing poverty and income
inequality within the Territory. This aspect of the review is crucial for fostering social equity and cohesion,
contributing to a more stable and prosperous society.
The overall objectives also considered evaluating the impact of the minimum wage on employment andthe broader economy. The review sought to understand how adjustments to the minimum wage might
influence job creation, unemployment rates, and the competitiveness of the Virgin Islands' businesses,
gauging the potential effects on small and medium-sized enterprises, which are significant employers inthe Virgin Islands, and ensuring that wage adjustments do not inadvertently hinder their growth or leadto job losses.
The review also aimed to establish a clear, transparent, and equitable process for periodically adjusting
the minimum wage in the future by ensuring that the minimum wage remains relevant and effective overtime, adapting to economic and labour market changes. Such a mechanism would also provide certainty
and predictability for employers, facilitating long-term planning and investment decisions, which isessential for the sustained growth and diversification of the Virgin Islands' economy.

Legal and Regulatory Frameworks
The Labour Code is a central piece of legislation that outlines labour practices in the Virgin Islands,
including wages, working hours, and conditions of employment. It sets the foundation for employment
relationships, workers' rights, and employers' obligations. Within this framework, the Labour Department
plays a crucial role in enforcing labour laws, including any stipulations related to minimum wage. The
department is responsible for ensuring Virgin Islanders are fairly considered for employment
opportunities, monitoring compliance, investigating complaints, and ensuring workers' pay meets legal
requirements.

142024 Minimum Wage Advisory Committee

Minimum Wage Advisory Committee
The composition of the Committee
Chairperson – Ms. Nelda Farrington
Role
Name
Sector
Employee Representatives
MemberMemberMemberMemberMemberMemberMember

Ms. Binta Jallow
Mr. Sean Palmer
Ms. Jelissa Potter
Mrs. Cherry-Ann George Smith
Mr. Sean McCall
Ms. Lauren Williams
Mr. Craig Noblett

PrivatePrivatePrivatePublicPublicPublicPrivateEmployer Representatives
Role
MemberMemberMemberMemberMemberMemberMemberNameSectorMr. Michael Thomas
Mr. Elton Leonard
Mr. Sendrick Chinnery
Ms. Stephanie Faulkner
Mr. Doug Riegels
Ms. Avaline Potter
Mrs. Shaina Smith-Archer

RetailRetailHospitality
Hospitality
Hospitality
Construction
BVI Chamber of Commerce

Other Representatives
Role
MemberMemberName
Mr. Laurence Wheatley
Ms. Lynette Harrigan, MBE

Committee Support Representatives
Name
Organisation

Role
SupportSupportSupportSupportOrganisation
Youth Representative
Civic Society/Non-Profit

PS. Petrona Davies
Dr. Dawn Alexander-Joseph
Ms. Kyla Forbes
Mr. Raymond Phillips

Ministry of Financial Services, Labour and Trade
Ministry of Financial Services, Labour and Trade
Ministry of Financial Services, Labour and Trade
Central Statistics OfficeTerms of Reference
The operation of the Minimum Wage Advisory Committee is guided by the conditions as set out in the
Term of Reference. (see Appendix 1).

15

2024 Minimum Wage Advisory Committee

Assumptions, Limitations, and Delimitations
Assumptions
The report assumed that the economy is relatively stable and capable of absorbing minimum wage
increases without significant adverse effects on employment or inflation. This assumption underpins thebelief that businesses can adjust to higher labour costs through increased prices, productivity
improvements, or profit margin adjustments, thereby maintaining employment and economic growth.
Another assumption is that the minimum wage should be sufficient to meet the basic living costs ofworkers and their families. The reasoning is based on the belief that the cost of living in the Virgin Islands
is well-understood and can be quantitatively measured, allowing for a minimum wage that reflects thesecosts. The report assumes that adjustments to the minimum wage are timely and effective in keeping
pace with changes in the cost of living.
There is an implicit assumption about the flexibility of the labour market to adapt to changes in theminimum wage policy. This implicit assumption includes the ability of workers to move between jobs or
sectors in response to wage changes and the capacity of employers to adjust their labour demand basedon the cost of labour. The assumption is that the labour market can achieve a new equilibrium without
significant dislocations or unemployment increases.
Another assumption is that higher wages will increase productivity, as workers are more motivated andhave greater job security. This assumption links wage increases with potential benefits for businesses
through improved worker performance, which can offset the costs of higher wages.
The effectiveness of minimum wage policies relies on the assumption that a robust system is in place formonitoring compliance and enforcing the regulations. It assumes that employers will adhere to theminimum wage laws and that the Government has the resources and mechanisms to ensure complianceacross all sectors of the economy.
Adjusting the minimum wage is a tool for promoting social equity and reducing income inequality. This
assumption presumes that increases in the minimum wage disproportionately benefit lower-income
workers and families, narrowing the income gap between the highest and lowest earners within theeconomy.

Limitations
One significant limitation is keeping the minimum wage aligned with the high and fluctuating cost of livingin the Virgin Islands. Due to the territory's reliance on imports for most goods and services, inflation rates
can quickly outpace wage adjustments, reducing the real income of minimum wage earners andpotentially leading to a decline in living standards over time.
The effectiveness of a uniform minimum wage policy is limited by the diverse economic landscape acrossdifferent sectors and sister islands within the Virgin Islands. For example, what has been deemed anadequate minimum wage in one industry or island may not address the living costs or economic conditionsin another, potentially leading to disparities in living standards and employment opportunities.
Ensuring compliance with minimum wage regulations poses another limitation. With its small but diverse
economy, the Virgin Islands may face challenges in monitoring and enforcing compliance across all
employers, especially in informal sectors. This limitation could result in some workers receiving less thanthe minimum wage; undermining the policy's effectiveness.

16

2024 Minimum Wage Advisory Committee

Delimitations
The minimum wage policy in the Virgin Islands is deliberately delineated to target non-exempt employees,
excluding specific sectors or types of employment based on criteria such as industry, job nature, or worker
classification (e.g., contract vs. full-time employees). These delimitations are designed to tailor the policy
to the territory's economic and labour market realities but may also exclude some workers from minimum
wage protections.
The policy framework typically includes mechanisms for periodic review and adjustment of the minimum
wage. This delimitation allows for systematically evaluating economic conditions, cost of living, and labour
market dynamics to inform adjustments. However, the frequency and criteria for these reviews arebounded by the regulatory framework, potentially limiting the agility of wage adjustments in response to
rapid economic changes.
Setting and adjusting the minimum wage in the Virgin Islands often involves stakeholder engagement,
including employers, workers' representatives, and government bodies. While this approach aims tocreate a balanced and informed policy, the scope of engagement and the weight given to different
stakeholders' inputs are delimited by the formal structures and processes established within the policy
framework.

MethodThe method used in the production of the review included:
i.
ii.
iii.
iv.

Committee engagement (in-person and virtual)
Document Review
Quantitative Analysis using data collected from the employee and employer survey instruments.
(see Appendices 2 and 3); andQualitative Analysis using information from focus group engagements, media interactions, andinformal sessions

17

2024 Minimum Wage Advisory Committee

Methodology
Guided by the Terms of Reference, the advisory committee used a mixed-method approach (qualitativeand quantitative analysis). The approach included:i.

Literature Review:• Reviewed existing literature on minimum wage impacts.
• Identified key findings, trends, and debates surrounding minimum wage policies andtheir economic consequences.
• Case studies were analysed and identified best practices from global and regional
experiences with minimum wage implementation.

ii.

Economic Impact Analysis:• Assessed the adequacy of the current minimum wage in meeting the basic needs ofworkers and its alignment with the local cost of living.
• Analysed economic indicators, such as employment levels, prices, and inflation, to assess
the potential implications of minimum wage adjustments.
• Identified and evaluated various options for adjusting the minimum wage, including
specific wage rates, indexing and implementation strategies.

iii.

Stakeholder Engagement:• Collected data from employers, employees, government agencies, and otherstakeholders through various methods, including surveys, interviews, and focused
discussions.
• Other stakeholder engagement included a presentation to the BVI Chamber of Commerce• Media appearances: UMOJA talk show live on social media pages and on ZBVI radio, TOLARadio, 284 Media Report.
• Consulted historical data, reports and decisions.

iv.

Comparative Analysis:• Gathered and analysed comparative data on minimum wage levels and their impacts
using regional and international comparisons, including UK Overseas Territories.
• Identified similarities and differences in economic conditions, labour market dynamics,
and minimum wage policies across territories/countries.
• Gathered insights from comparative analysis to inform the assessment of potential
impacts in the Virgin Islands.

18

2024 Minimum Wage Advisory Committee

Understanding the Terms
The terms as defined by the International Labour Organisation (ILO):
Cost of Living
The International Labour Organization (ILO) does not provide a direct one-sentence definition of "cost ofliving" akin to its definitions of "minimum wage" or "living wage." However, the cost of living generally
refers to the amount needed to cover basic expenses such as housing, food, taxes, and healthcare in a
specific place and time; a concept widely understood and used in economic analyses and policy
discussions.

Living WageThe International Labour Organization (ILO) conceptualises a living wage as "the level of wages sufficient
to meet the basic living needs of an average-sized family in a particular economy" (International Labour
Organization, 2021).

Minimum WageThe International Labour Organization (ILO) defines minimum wage as "the minimum amount of
remuneration that an employer is required to pay wage earners for the work performed during a given
period, which cannot be reduced by collective agreement or an individual contract" (International Labour
Organization, 2023).

Standard of Living
The International Labour Organization (ILO) describes the standard of living as "the level of wealth,comfort, material goods, and necessities available to a certain socioeconomic class or a certain geographic
area," reflecting on how these factors influence the well-being and quality of life of individuals andcommunities (International Labour Organization, n.d.).

Wage Adjustment
In general terms, wage adjustment refers to changes made to wages to reflect shifts in economic
conditions, cost of living, and productivity or to ensure salaries remain fair and competitive.

The Relationship between the Terms
The minimum wage sets a legal baseline for earnings. Living wage aims to meet the cost of living
necessities, influencing the standard of living. In contrast, wage adjustments ensure these wages remain
relevant and supportive of an individual's or a family's economic well-being in a dynamic economic
environment.

192024 Minimum Wage Advisory Committee

SECTION 2: LITERATURE REVIEW IN THE CONTEXT OF THE VIRGIN ISLANDSInternational Labour Organization’s View on Minimum WageThe International Labour Organization (ILO) views a minimum wage policy as a fundamental instrument
for reducing poverty and inequality, promoting social justice, and driving economic growth throughenhanced worker productivity. The ILO emphasises the importance of establishing a minimum wage thatbalances the needs of workers and their families with economic factors, ensuring that the wage represents
a level that provides a decent standard of living without adversely affecting employment rates. The
organization advocates for regular adjustments to the minimum wage, reflecting changes in the cost ofliving and economic conditions, to sustain its relevance and effectiveness as an economic tool.
The ILO underscores the significance of a comprehensive and consultative approach to setting minimum
wages in its guidance. This advice involves engaging with social partners, including employers' andworkers' organizations, to achieve consensus and enhance the policy's acceptance and effectiveness. The
ILO recommends that detailed socio-economic data and analysis inform the minimum wage-setting
process, ensuring that decisions are based on empirical evidence. Such an approach facilitates the
adoption of minimum wages that are both equitable and economically viable, contributing to broadersocial and economic objectives.
Moreover, the ILO highlights the need for effective enforcement mechanisms to ensure compliance withminimum wage regulations. These mechanisms include establishing effective monitoring and inspection
systems and clear and accessible legal frameworks that enable workers to claim their rights. The
organization also stresses the role of minimum wages in broader social policy, advocating for integration
with other measures such as social security, education, and training programmes. This holistic approachaims to enhance the overall impact of minimum wages on reducing poverty, supporting sustainableeconomic development, and promoting decent work for all.

Impact of Minimum Wage on Employment
The debate on the impact of minimum wage adjustments on employment levels is a significant aspect of
economic discourse, with various academic and policy literature presenting differing views.
Understanding this impact is essential in the context of the VI, given the territory's economic structure,
which relies heavily on sectors like tourism and financial services. These sectors employ a wide range oflabour, from highly skilled professionals to service industry workers, making the effects of minimum wage
adjustments potentially vary across the economy. Literature suggests that while moderate increases inminimum wage can lead to improved living standards for low-income workers without significantly
affecting overall employment levels, the specific effects can vary depending on the economic conditions
and labour market dynamics of a given region.
In economies such as the Virgin Islands, the elasticity of employment concerning minimum wage
adjustments can be more noticeable, particularly in labour-intensive sectors like tourism, where profit
margins might be small, and the ability for employers to pass on increased labour costs to consumers may
be limited due to many reasons including competitive pressures. However, academic studies highlight thepotential benefits of raising minimum wages, such as reduced employee turnover, increased productivity,and higher consumer spending due to improved earnings among low-wage workers. These benefits offset
the costs to employers and mitigate the negative impacts on employment. The literature calls for carefulconsideration of the local economic context, including the economy's sectoral composition and theprimary wage rates relative to the cost of living, in determining the optimal minimum wage level that
supports employment and living standards.
20

2024 Minimum Wage Advisory Committee

Furthermore, policy literature emphasises the importance of complementary measures to support
businesses and workers, as minimum wage levels are adjusted. The Virgin Islands could include targeted
tax incentives for small businesses, investment in workforce development programmes to enhance
worker skills and productivity, and support for sectors disproportionately affected by wage increases.
Such measures can help ensure that minimum wage policies contribute positively to the territory's
economic objectives without unintended adverse effects on employment. Ultimately, the literaturesuggests that the impact of minimum wage adjustments on employment is an issue that requires abalanced approach, informed by empirical evidence and tailored to the specific economic and labour
market conditions of the Virgin Islands.

Wage Elasticity and its Implications for Employment
Wage elasticity, a key economic concept, refers to labour supply and demand responsiveness to wagechanges. In the Virgin Islands, understanding wage elasticity is vital, especially given the territory's relianceon tourism and financial services, which exhibit different labour market dynamics. Even small wage
increases could significantly change employment levels or hours worked in sectors where wage elasticity
is high. For instance, employers might be more sensitive to wage increases in the tourism sector,
characterised by a more flexible, often seasonal workforce. They could respond by reducing hiring or
cutting back on employees' hours to manage costs, especially during low seasons when profit margins arethinner.
In the financial services sector, where specialised skills are in high demand and more challenging to
replace, wage elasticity might be lower. In this sector, wage increases may not lead to significant
reductions in employment, as the cost of losing skilled employees could outweigh the expense of higher
wages. However, businesses might still seek to mitigate the impact of wage increases through productivity
improvements or by passing on costs to clients, which have different implications for the sector'scompetitive position. Understanding these dynamics is essential for policymakers in the Virgin Islands as
they consider adjustments to minimum wage laws or other labour market interventions. It's important tocreate policies that consider the specific characteristics of each sector to avoid unintended consequenceson employment and hours worked.
The implications, therefore, of wage elasticity extend beyond employment levels to include the overall
economic health and competitiveness of the Virgin Islands. For instance, significant wage adjustments
without considering the elasticity could inadvertently affect the territory's attractiveness as a tourist
destination or its competitiveness as a financial hub. Therefore, an approach that includes sector-specificanalysis and stakeholder consultations is suggested. Additionally, policies to enhance workforce skills andproductivity could mitigate some of the negative impacts of higher wage costs, making the Virgin Islands'
economy more resilient and adaptive to changes.

212024 Minimum Wage Advisory Committee

SECTION 3: SOCIO-ECONOMIC ANALYSIS
Economic Analysis
Despite the geographic location of the Virgin Islands and its low population size, the territory continues
to produce noticeable impacts globally. The backbone of its service delivery is built on the dedication of
its population and the working class that supports economic activities. On average, the Virgin Islands
realises an annual population growth of 2.6%, notwithstanding the decline following the natural disastersof 2017. Post-2017, the population growth saw increases from 2018, which were linked directly to therecovery process and then towards the development phase. In 2024, growth is projected between 1 -2%.

Leveraging the skills and talents of its people, the Virgin Islands' economy mainly depends on activities
driven by tourism and financial services. While other sectors have their role in shaping the territory's
economic landscape, all the economic sectors are subject to shocks that can influence their performanceand levels of impacts, including the well-being of the employees.
Over recent years, the impact of inflation in the Virgin Islands has been linked to its heavy reliance on
imports for goods and services mainly for the United Stated of America (USA). This dependency subjects
the territory to global price fluctuations, particularly in energy and food, which can quickly impact local
prices, affecting the cost of living and, by extension, the purchasing power of its residents. While the Virgin
Islands might benefit from periods of low global prices, any significant uptick in global inflation can directly
and immediately impact the local market due to its heavy reliance on imported goods. Additionally, theterritory's imported monetary policy, pegged to the US dollar, provides some stability but limits theflexibility of monetary response to inflationary pressures as the territory does not control the option formonetary policy adjustments.
While prices continue to increase, unemployment rates have historically remained relatively stable.
Despite this reality, the tourism sector, in particular, is susceptible to global economic trends, natural
disasters, and travel-related health concerns, such as pandemics (COVID-19). Employment in financial
services, on the other hand, while more stable, is subject to international regulatory changes andcompetition from other jurisdictions. Given these concerns, the Government's efforts to diversify the
economy and improve workforce skills are critical in creating more resilient employment opportunities,
reducing the economy's vulnerability to sector-specific downturns, and fostering a more stable, consistent
unemployment rate.
22

2024 Minimum Wage Advisory Committee

Furthermore, GDP growth in the Virgin Islands reflects its economic health and resilience. The territory
has shown adaptability in the face of global economic shifts and challenges to its main economic sectors.
Additionally, tourism activities remain a significant and volatile contributor to GDP, and efforts to expand
and enhance this sector are essential to sustainable growth. Investments in infrastructure and technology
are also added consideration, aiming to reduce the economy's external dependencies and improve its
sustainability. The Virgin Islands' economic strategy must balance growth with sustainability, capitalisingon its strengths in tourism and financial services while exploring new opportunities for economic
diversification and resilience to support workforce sustainability.

GDP GrowthOver the years, the Virgin Islands has demonstrated remarkable economic resilience and adaptability
amidst global economic shifts and challenges, particularly in the financial services sector. This sector'sability to navigate increased regulatory scrutiny and maintain its status as a premier global financial hub
is a testament to the territory's robust regulatory framework and its commitment to international
standards. Despite external pressures, the financial services sector continues to be a significant
contributor to the Virgin Islands' GDP, underscoring the importance of this industry to the territory's
overall economic health and the financial dependence on government revenue. The Virgin Islands'
proactive approach to addressing global challenges and ensuring compliance with international
regulations has helped safeguard the sector's economic contributions, demonstrating the territory's
continued adaptability and resilience.
Tourism, the other economic pillar of the Virgin Islands' economy, presents opportunities and challenges
for GDP growth. As a volatile but vital contributor, the tourism sector's performances are closely tied to
global economic conditions, consumer preferences, and environmental sustainability. Recognising this,the Virgin Islands has significantly expanded and enhanced its tourism offerings. These offerings aredesigned to boost the sector's direct contribution to GDP and stimulate growth in related industries suchas retail, food and beverage, and entertainment. By focusing on sustainable tourism development, theVirgin Islands seeks to maximise the sector's economic benefits while minimising its environmental
footprint.
Infrastructure, renewable energy, and technology investments further reflect the Virgin Islands'
commitment to reducing its economic dependencies and improving sustainability. Developing modern,resilient infrastructure and embracing renewable energy sources are vital strategies for enhancing theterritory's self-sufficiency and reducing its vulnerability to external shocks, such as fluctuations in global
energy prices or natural disasters. Similarly, investments in technology and digital connectivity aim to
unlock new economic opportunities, facilitate business operations, and improve the delivery of public
services. These strategic investments contribute to immediate economic growth and lay the foundation
for a more sustainable and diversified future economy, creating opportunities for better wages.
While the Virgin Islands remains resilient, its economic strategy emphasises balancing growth withsustainability, leveraging its established strengths in tourism and financial services while actively seeking
new avenues for diversification and resilience. This approach recognises the importance of maintaining
the territory's competitive advantages in its traditional sectors, while embracing innovation and exploring
emerging industries such as digital services, green technology, and creative industries. By pursuing abalanced and forward-looking economic strategy, the Virgin Islands aims to ensure long-term prosperity
and resilience, positioning itself as a vibrant and sustainable small island economy in an increasingly
complex global landscape.
232024 Minimum Wage Advisory Committee

From a regional standpoint, the economic outlook for 2024 is projected to see modest growth, withchallenges and opportunities throughout the region. GDP growth is expected to be around 1.6% in 2024,
2.7% in 2025 and 2.6% in 2026; driven by structural economic challenges, external economic pressures,and ongoing pandemic recoveries. As reported by the World Bank, the region continues to face challenges
with fiscal imbalances, low productivity, and the need for structural reforms. Additionally, the Caribbean
Development Bank posits that the economies of the Caribbean are handling the challenges with varying
degrees of success, focusing on enhancing productivity and leveraging sectors like tourism and renewableenergy to support increases in economic growth. The tourism sector will continue to expand, but at a
slower pace.

Financial Services
The Financial Services Sector has been plagued with its share of challenges, including the requirements
for a new global reporting standard, economic substance, impacts from inflationary pressures, and manyother uncertainties. Additionally, recent domestic concerns have arisen, prompting further scrutiny of theindustry and its ability to remain stable.
Further examination of the sector shows some fluctuation in the level of new incorporations and theirlinkage to the revenue receipts for the Central Government. As reported in the 2022-2024 MacroEconomic Review and Outlook, the plateauing effects of the industry draws a levelling off on the annual
numbers. The report further stated, “By the end of 2022, it is projected that around 29,000 newincorporations would have been registered, about a 20% decline from 2021. In addition, revenue fromthe industry of around $222 million, just below 2021’s intake, is anticipated”.
While the direct impacts of minimum wage may not affect this sector due to the skills needed for thisindustry, the indirect impacts can have a multiplier effect on the economy. Any shock to this sector couldchange the operational structures and results generated by activities within the industry, given the heavy
reliance on the Central Government on taxes and fees to support the fiscal budget of annual operations,
including the funding of social systems.

242024 Minimum Wage Advisory Committee

Tourism
Activities within the tourism industry spread across a broad section of the economy, supporting its role asan economic pillar. As a pillar, the reliance on activities is critical to the territory's reach for economic
stability. While activities within this sector have a multiplier effect, many low-wage workers are employedwithin this industry.
Analysing the performance of cruise passengers, there was a sharp decline from 2017 to 2018, almost
halving the number of passengers. This decline resulted from the destruction of a large percentage of the
tourism infrastructure, weakening the economic pillar and threatening employees' livelihoods. In 2019,
there was a significant recovery, surpassing the 2017 figure. However, this increase was short-lived as thenumbers plummeted in 2020 due to the impact of the COVID-19 pandemic and the closure of theterritory's borders. The year 2021 saw an even further decline from 2020, maintaining the low trend dueto the pandemic's ongoing effects. However, there was a notable recovery in 2022 and a substantial
increase in 2023, suggesting a solid post-pandemic rebound and positive economic recovery.
Examination of overnight passengers showed a drop in 2018 compared to 2017, but less drastically thanthat of cruise ship passengers. Furthermore, a rise occurred in 2019, although it did not reach the 2017
level but clearly showed signs of recovery. This activity was also short-lived as the pandemic's impact wasevident in 2020, when a sharp decrease was realised. A slight dip continued into 2021, but there was a
noticeable recovery pattern in 2022 and 2023, indicating a return towards pre-pandemic levels.
Arrivals from day trippers increased slightly each year from 2017 to 2019. The most significant impact ofthe pandemic is seen in 2020, with numbers dropping drastically. However, a gradual recovery is noted in
2021 and 2022, but there was a more pronounced increase in 2023, which could be due to ease of travel
restrictions or increased local tourism.
The fluctuations in tourist numbers, particularly the sharp decline in 2020 followed by a steady recovery
through 2022, and a robust rebound in 2023, had significant implications for the labour market, a
substantial contraction in cruise ship passengers and overnight visitors in 2020 resulted in reduced
demand for labour, putting downward pressure on wages in the tourism and hospitality sectors.

25

2024 Minimum Wage Advisory Committee

Tourist Arrivals, 2017 - 2023
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
-

2017
2018
2019
2020
Cruise Ship Passengers 409,723 200,552 575,134 219,434

2021
70,0902022
2023
343,571 719,638

Overnight Visitors

335,712 192,312 302,499

82,68759,289174,344 262,080

Day Trippers

11,578

3,235

4,336

6,512

16,108Cruise Ship Passengers

17,358Overnight Visitors

13,297

Day Trippers

As cited in the 2022-2024 Macro-Economic Review and Outlook, it is projected that 2024 will see above
one million visitors as the territory continues to realise modest outcomes from several supporting
initiatives to promote and market the tourism product.
The external shocks affected low-wage employees, as businesses struggled to maintain their workforce
amidst falling revenues. However, the subsequent recovery suggests that these sectors might beexperiencing a demand for increased labour to accommodate the surge in tourists, potentiallystrengthening the case for a higher minimum wage. The robust increase in all categories of tourists in
2023 indicates a healthier economy where consumers are willing to spend more on travel and leisure,thereby providing businesses with the financial capability to support a rise in the minimum wage.
Furthermore, the impact of rising tourist numbers on the minimum wage would also depend on theelasticity of labour demand in the tourism sector. If the demand for labour is relatively inelastic, therecovery in tourist numbers could lead to higher employment without significant wage changes.
Conversely, if labour demand is elastic, increasing tourism could result in heightened worker competition,
thereby driving wages. Therefore, it is essential to consider these factors when the recommendation for
the adjustments to minimum wage policies is finalised.

Inflation
In the Virgin Islands, inflation can be mainly influenced by external factors such as global commodity prices
and import costs. Given the Virgin Islands' reliance on imports for food, fuel, and consumer goods, any
global price increase can directly translate into higher domestic inflation. Furthermore, balancing inflation
with wage adjustments could be a crucial consideration in ensuring that real income remains relevant andthat the purchasing power of residents is preserved.
Inflation dynamics are tied to the territory's economic structure and reliance on imports for mostconsumer goods, including essentials like food and fuel. This import dependence makes the Virgin Islands
particularly vulnerable to fluctuations in global commodity prices, which can swiftly lead to increases indomestic prices. Such vulnerability underscores the importance of consistently monitoring the movementof prices to address inflationary pressures. These pressures impact the cost of living and have broader
economic implications, affecting consumer spending, investment, and overall economic stability in the
territory.
26

2024 Minimum Wage Advisory Committee

Furthermore, the logistical challenges of importing goods to the Virgin Islands further add to rising
inflationary pressures. The territory's geographical location and limited internal market contribute tohigher transportation and distribution costs, which, in turn, inflate the prices of goods and services for
consumers. These combined factors can create a cost-push inflation scenario, where the costs of goods
and services rise, increasing the general price level and thereby increasing the cost of living.
Therefore, balancing inflation with wage adjustments presents an essential aspect of economic policy for
the Virgin Islands. As inflation impacts the cost of living, there is a corresponding need to ensure thatwages, particularly minimum wages, are adjusted to preserve the purchasing power of residents. Thisbalance is important for supporting the population's welfare and sustaining consumer demand, which isa crucial economic activity driver. Adequate wage adjustments help prevent the erosion of real incomes,
ensuring that residents can maintain their standard of living despite rising prices, which can support ahealthy, consumer-driven economy.
The Virgin Islands’ approach to managing inflation and its impact on wages is multifaceted. It involves
careful monitoring of global economic trends, strategic planning to address logistical challenges, andpolicy adjustment to safeguard the territory’s economic health. Ensuring that wage policies are responsive
to inflationary pressures is fundamental to protecting the economic well-being of the territory’s residents.
This strategy will support immediate economic stability and contribute to the long-term resilience of theVirgin Islands’ economy, enabling it to navigate the complexities of being a small island economy in a
globalised world.
Monitoring the price movements saw the performance of the Consumer Price Index for the first twomonths of 2024, as reported by the Central Statistics Office (CSO), at 3.32 and 3.20 percentages for
January and February. The main contributing items were evidenced in the upward movement of foodprices.
Over the medium term, 2024-2026, the inflation rate is projected to be between 2-3%, suggesting a minor
increase. While these projections are moderate, they are subject to changes, shifting global dynamics, andthe response to external pressures.

27

2024 Minimum Wage Advisory Committee

Small Business Considerations
Small businesses support the backbone of the local economy in the Virgin Islands. These businesses often
operate with small profit margins and are particularly sensitive to changes in operating costs. A minimum
wage increase could raise labour costs, leading to a re-evaluation of business models and operational
efficiencies. While larger companies can absorb these costs more efficiently, small businesses may need
help, potentially leading to reduced hiring, delayed expansion plans, or increased prices for goods andservices to offset the higher wage bill.
In connecting the economic activities within the territory, the tourism and service sectors are vital areasthat predominantly consist of small businesses such as boutique hotels, restaurants, and leisure service
providers. These sectors are labour-intensive and heavily reliant on low-wage workers. A significant
increase in the minimum wage could disproportionately affect these businesses, straining their financial
capacity. The impact of an increase in minimum wage could vary. While some companies might experiencea boost in local spending due to higher worker incomes, others could face challenges in maintaining theirworkforce or profit margins. Therefore, the wage increase must be carefully calibrated to support thegrowth and sustainability of these critical sectors without imposing undue financial burdens.
Furthermore, financial sustainability is another crucial factor for small businesses in the Virgin Islands.
Many entities operate with limited access to capital and financial reserves, making them vulnerable tocash flow disruptions. A substantial increase in wage expenses necessitates cuts in other areas, such as
employee training, development, and investment in technology, which could hamper business growthand competitiveness in the long run.
Given the importance of the minimum wage review, the broader economic implications of wage
adjustments on small businesses must be considered within the Virgin Islands' macroeconomic context.
While higher wages could lead to increased consumer spending, which can benefit local businesses, they
could also result in inflationary pressures, affecting the overall cost of doing business.

Sector-Specific Impacts
Given the varying composition of the workforce and the different economic contributions of each sector,
the sector-specific analysis revealed considerations for the tourism and hospitality sector, the financial
services sector, the retail and service sectors, the construction and agriculture sectors, and the public andnon-profit organisations.
In the Virgin Islands, the tourism and hospitality sectors, being labour-intensive and a significant employer
of minimum wage workers, will likely feel the immediate impact of a minimum wage increase. Hotels,
restaurants, and tour operators often operate on competitive margins and may face challenges inabsorbing higher labour costs. While increasing wages could improve workers' living standards in the
Virgin Islands and potentially enhance service quality, it might also lead to higher service prices, affecting
the sector's competitiveness. The increase in operational costs may necessitate adjustments in pricing
strategies, which could impact tourist inflows and overall sector performance.
The financial services sector is a high-value sector with relatively fewer minimum wage workers, if any, so
the financial services industry in the Virgin Islands might experience a less direct impact from minimum
wage increases. This sector, which includes banking, insurance, and legal services, typically offers salaries
above the minimum wage due to the specialised skills required. However, indirect effects, such asincreased consumer spending and potential inflationary pressures, could influence operational costs and282024 Minimum Wage Advisory Committee

pricing. The sector's resilience and capacity to adapt to wage changes would likely prevent significant
disruptions, but the broader economic implications still need to be monitored.
Small businesses in the retail and services sector, which often employ minimum wage workers, could facesignificant challenges with increased wage costs. These businesses, which include shops, beauty salons,and maintenance services, operate with tight margins and are sensitive to changes in labour costs.
Increasing the minimum wage could lead to higher operational costs, potentially resulting in price hikes
for consumers or a reduced workforce to maintain profitability. The sector's response to wage increases
will be crucial in determining its impact on employment and service affordability.
In sectors like construction and agriculture, where there is a mix of skilled and unskilled labour, the impactof a minimum wage increase could be varied. These sectors may experience cost pressures, mainly if they
employ many minimum-wage workers. However, the demand for construction and agricultural products,
often influenced by broader economic factors, may buffer the impact. Wage increases in these sectors
could lead to more significant investment in mechanisation or productivity-enhancing measures to offset
labour cost increases.
The public sector and non-profit organisations in the Virgin Islands, which may also employ minimum
wage workers, would need to adjust their budgets to accommodate wage increases. While these entities
might not be profit-driven, higher wage bills could strain public finances or the operational capacities of
non-profits. The challenge will be to manage these cost increases without reducing service delivery or
operational efficiency.

External Economic Influences
The Virgin Islands operates within a small, open economy highly susceptible to external shocks, such as
fluctuations in global financial markets and changes in tourism flows. These external variables cansignificantly influence the timing and effectiveness of minimum wage adjustments in the territory. For
instance, the Virgin Islands' financial services sector, a central pillar of its economy, is closely tied to global
financial markets. Downturns in these markets can lead to reduced business activity and government
revenue, affecting the broader economy's health. In such scenarios, increasing the minimum wage could
strain businesses already facing reduced profits, potentially leading to job cuts or business closures.
Tourism, another critical sector for the Virgin Islands, is inherently volatile and can be affected by global
economic conditions, natural disasters, and public health crises. A significant portion of the workforce inthe tourism sector is often on minimum wage or close to it. While increasing the minimum wage could
improve living standards for these workers, if the timing coincides with a downturn in tourism activities,
the resultant increase in operational costs could exacerbate financial pressures on tourism-related
businesses. This could lead to a situation where the intended benefits of wage increases are offset by
reduced employment opportunities or hours for workers in this sector.

29

2024 Minimum Wage Advisory Committee

Labour Market Conditions
Analysis of the Labour Market Segmentation
The labour market of the Virgin Islands exhibits distinct segmentation by sectors, geography, anddemographics, reflective of the territory's economic structure and geographic layout. Considered themain economic sectors contributing to the Virgin Islands' economy, tourism and financial services attract
different workforce segments with varying skillsets and employment conditions. The tourism sector
predominantly employs a labour force in hospitality, retail, and service roles, often characterised byseasonal employment patterns and varying levels of job security. On the other hand, the financial services
sector employs a more stable, year-round workforce with specialised skills in banking, law, and corporate
services. This sectoral segmentation creates distinct labour market dynamics, influencing employment
opportunities, wage levels, and working conditions.
Geographically, the Virgin Islands' labour market is influenced by the distribution of economic activities
across the territory's islands. The main island of Tortola, hosting the capital Road Town, serves as the
economic hub, particularly for the financial services industry and government employment. Meanwhile,other islands, such as Virgin Gorda, Jost Van Dyke, and Anegada, have economies more focused on
tourism, leading to geographical variations in employment opportunities and economic vitality. This
geographic segmentation creates the risk of logistical challenges of inter-island travel, affecting labour
mobility and access to employment opportunities for residents living on less populated islands.
Demographically, the Virgin Islands' labour market is shaped by a diverse workforce that includes both
local Virgin Islanders and many expatriates and migrant workers. This demographic mix is particularly
pronounced in sectors like tourism and construction, where there is an increasing demand for a range ofskill levels, from low-skilled service positions to highly skilled management roles. The presence of
expatriate professionals is also notable in the financial services sector, reflecting the global nature of thisindustry. The demographic segmentation of the labour market has implications for policy-making,especially regarding workforce development, immigration policies, and social integration efforts, ensuringthat the benefits of economic growth are inclusive and broadly shared among residents.
The following chart shows the number of persons employed from the different selected and groupedcountries for the year 2022. Whereas persons born in the Virgin Islands individually make up the largest
share of the employed persons, collectively, expatriates account for a substantially higher percentage of
employed persons; 27.5% versus 72.5%. Expatriate workers dominate the workforce of the Virgin Islands
as there is insufficient local labour to satisfy the demands of the ever-increasing labour market.

302024 Minimum Wage Advisory Committee

In addition to understanding the dynamic of the workforce by country, a view of selected sectors
compares analyses of employment by indigenous Virgin Islands with expatriate workers. The following
chart shows the percentage of employees from the Virgin Islands versus Expatriate workers in the various
broad industry groups. As evidenced from the data, all of the various industry groups were dominated by31

2024 Minimum Wage Advisory Committee

expatriate workers except for the industry group Mining, Quarrying, Electricity, Gas and Water. Expatriate
workers' dominance was most pronounced in the Construction sector.
Understanding the Virgin Islands' labour market segmentation by sectors, geography, and demographics
is essential for developing targeted employment policies and initiatives. Such analysis can help identify
areas of opportunity and challenge within the labour market, guiding interventions to enhance
employment prospects, address skill gaps, and improve working conditions. For the Virgin Islands,
addressing these labour market segments is vital for sustaining economic growth, improving thecompetitiveness of key sectors, and ensuring that economic development benefits are equitably
distributed across the territory's diverse communities. Customised strategies to support sectoral growth,facilitate labour mobility, and foster workforce development can help resolve the challenges posed bymarket segmentation, contributing to a more inclusive labour market in the Virgin Islands.

Unemployment Rate
An unemployed person is defined as someone not working but is available to work and actively seeking
work. The unemployment rate's stability in the Virgin Islands is a testament to the resilience andadaptability of its economy despite its heavy reliance on the main economic pillars. The tourism industry,a cornerstone of the Virgin Islands' economy, is notably susceptible to fluctuations driven by global
economic conditions, environmental factors, and health crises such as the COVID-19 pandemic. Thesevulnerabilities underscore the importance of the Virgin Islands' efforts to strengthen the sector's
resilience and mitigate the impacts of such external shocks on employment. Meanwhile, the financial
services sector faces challenges, including international regulatory changes and competition from otherjurisdictions. These factors can influence the trends in employment, highlighting the need for the Virgin
Islands to maintain its competitive edge in the global market.
Similarly, the other sectors carry their share of challenges, which can directly and indirectly impact
employment trends. The Government of the Virgin Islands recognises the importance of economic
diversification and skill enhancement as critical strategies for minimising the economy's exposure tosector-specific risks and promoting sustainable employment growth. By investing in developing new
industries and upgrading the workforce's skills, the Virgin Islands can create a more versatile and resilient
economic foundation. This approach aims to broaden the territory's economic base beyond its traditionalpillars and equip the local workforce with the competencies needed to thrive in a diversifying economy.
Such initiatives are crucial for reducing dependency on any single economic sector and ensuring a morestable and consistent unemployment rate, even in the face of global and local adversities.
The unemployed represents persons in the labour force who want to work, are able to work and are
actively seeking work. Like any other country, a high level of unemployment poses various threats to asmall island developing state like the Virgin Islands. This contributes to economic instability, which canlead to a host of social challenges. The chart below shows that the Virgin Islands recorded unemployment
rates well below the threshold (5%), considered full employment in the years leading up to 2017 when
the country was devastated by a series of natural disasters. In 2017, the Virgin Islands recorded an alltime-high unemployment rate. However, the resilience of the Virgin Islands was on full display as theunemployment rate dropped rapidly to reach a rate just above the threshold two years after the major
setback.

32

2024 Minimum Wage Advisory Committee

Furthermore, according to the National Sustainable Development Plan, the Virgin Islands' strategic focus
on enhancing workforce skills is pivotal in preparing its residents for the evolving demands of the global
labour market. Initiatives such as vocational training programmes, educational reforms, and partnerships
with the private sector are essential for fostering a skilled labour force capable of adapting to new
economic opportunities and reducing the pressures on the social systems resulting from low wages. These
efforts reduce the unemployment rate by making the workforce more attractive to a broader range ofindustries and playing an important role in supporting the territory's long-term economic stability andgrowth. Through these concerted efforts in diversification and skill development, the Virgin Islands aims
to build an economy that is resilient in the face of external shocks and capable of providing stable andfulfilling employment opportunities for its residents.

Employment
After the global recession of 2008, and prior to the devastating events of 2017, the number of persons
employed in the Virgin Islands grew consistently. In 2018, the number of employed persons dropped
significantly following the devastating two category five hurricanes, but by 2019 it rebounded, supportedby the recovery efforts, to a level which surpassed 2016. This growth in the number of persons employed
was short-lived, as the entire world experienced a crippling pandemic in 2020. The effects of this crisis
persisted for two years and the Virgin Islands only saw increases in the number of persons employed by2022, indicating growth within the economic sectors.

33

2024 Minimum Wage Advisory Committee

Prior to 2018, the number of female employees outpaced that of their male counterparts. However, thispattern changed after the disastrous events of 2017. Due to the mass destruction and the urgent need torebuild the infrastructure, an unprecedented number of male employees were imported into the territory.
This action dramatically changed the sex distribution of the workforce in the Virgin Islands. The chart34

2024 Minimum Wage Advisory Committee

below shows that from 2018 to 2022, the number of male employees outpaced female employees.
However, since 2020, the difference between male and female employees is getting smaller.

Earnings
Average Income of Employees
The average annual earnings in the Virgin Islands grew steadily until 2017, when it registered a decrease
as economic activity was disrupted by a series of natural disasters. In 2018, average annual earnings began
to climb again, and recorded levels of average annual earnings for 2018 and 2019 surpassed that of 2016.
However, this increase was again interrupted by the onset of a pandemic and a substantial drop in averageannual earnings was seen in 2020. The direct impact of the pandemic persisted for two years. Postpandemic, the average annual earnings in the Virgin Islands quickly rebounded, reaching its highest levelin 2022.

In the wake of these disasters, 2018 marked a turnaround year where efforts to rebuild and revitalise theeconomy began to bear fruit. By 2018 and continuing into 2019, average annual earnings not only
recovered from the post-disaster slump but also surpassed the levels recorded in 2016. This resurgenceindicated a robust recovery and adaptation by the local economy, showcasing the resilience of businesses
and the workforce in overcoming the challenges posed by the natural disasters.
However, this recovery trajectory was once again disrupted by the global onset of the COVID-19 pandemic
in 2020, which led to significant economic downturns worldwide. In the Virgin Islands, this resulted in a
sharp decline in average annual earnings, as industries were hit by lockdowns, reduced consumer
spending, and widespread economic uncertainties. The pandemic's impact lingered through 2021, stalling
earnings recovery. Nevertheless, post-pandemic, as restrictions lifted and normalcy began to return in
2022, the Virgin Islands saw a rapid rebound in average annual earnings, reaching the highest levels ever35

2024 Minimum Wage Advisory Committee

recorded. This swift recovery highlights the adaptive strategies and resilience of the local economy,
pointing towards a hopeful trajectory of growth and stability.

Average Income of Employees by Sex
In the Virgin Islands, the average annual earnings for males typically exceeded that of females. The
following chart shows that, since 2017, the year of the extreme natural disasters, the earnings gap
between males and females began to close. This occurred because the resultant reduction in averageannual earnings was not as significant for females as it was for males. The average annual earning forfemales was higher than that of males after the onset of the pandemic. This resulted due to the more
drastic reduction in average annual earnings for males than females. However, as the effects of thepandemic subsided, the average annual earnings for males began to increase at a faster rate than that offemales.

The onset of the COVID-19 pandemic further influenced the earnings landscape. As the pandemic took
hold, it disproportionately affected the industries predominantly employing males, leading to a steeper
decline in their average annual earnings. In contrast, the sectors that typically employ more females were
not as severely impacted, which resulted in females, on average, earning more than males for the firsttime during this period. This reversal highlighted the variability and vulnerability of sectors to global crises
and their differing impacts on gender-based earnings.
As the effects of the pandemic began to subside, the recovery pattern between the genders diverged. By
2022, the average annual earnings for males started to rebound at a faster pace than that for females,
gradually restoring the earnings balance. This recovery has brought the average annual earnings for both
sexes to nearly the same level once again by the end of the year. This dynamic underscores the ongoingchanges in the labour market and the economic factors influencing gender earnings disparities, suggestinga return to previous norms but also indicating potential areas for policy intervention to address thesedisparities more robustly.

36

2024 Minimum Wage Advisory Committee

For employment, youths, for various reasons, represent the age group that is often under-represented
when compared to other age groups. The following chart shows that the average annual earnings foryouths is well below that of the other age groups.

Youth employment is a significant issue in many regions, including the Virgin Islands, where young people
are often underrepresented in the workforce. This underrepresentation is reflected in the lower averageannual earnings for the youth demographic compared to other age groups. Various factors contribute tothis disparity, including limited job opportunities for young entrants, a lack of experience, and possibly ahigher concentration in lower-paying jobs or part-time positions. These challenges are worsened by the
economic shifts and disruptions that disproportionately affect entry-level and less secure job sectors
where younger workers are more likely to be employed.
The data indicating that average annual earnings for youth lag well behind those of other age groups
underscores the need for targeted interventions to enhance youth employment opportunities. Initiatives
could include vocational training programmes, apprenticeships, and policies designed to stimulate job
creation in sectors likely to employ young people. Furthermore, efforts to increase educational andtraining opportunities tailored to the evolving demands of the local and global economy could help bridge
the earnings gap. Addressing these issues is crucial not only for improving the economic prospects ofyoung people but also for bolstering the overall economic health of the Virgin Islands by ensuring a wellintegrated and adequately compensated workforce across all age groups.

Employment-to Population Ratio
The Employment-to-Population Ratio considers the number of persons employed in relation to thenumber of persons in the population. Other versions of the ratio look at employment in relation to the
population 15 years and over and the working age population. Its objective is to show how efficiently an
economy is in providing employment for persons in the population. The following chart shows the ability
for the Virgin Islands to provide work for members of the population as a whole. The percentage of
persons employed in the population dropped off significantly from 2017 after a significant economic
setback and reached its low in 2018. The percentage rebounded slightly by 2019 but was again stymied37

2024 Minimum Wage Advisory Committeeby the onset of the pandemic in 2020. The year 2022 saw a marginal improvement in the Employment-toPopulation Ratio.

Labour Force Participation Rate
The Labour Force Participation Rate (LFPR) is a measure that shows the relationship between the labour
force and the working age population. It reveals the extent to which an economy can provide employment
for persons who are eligible and willing to work. The chart below shows that for selected years, LFPRs in
the Virgin Islands for both male and females surpassed 80%. The rates for males were traditionally higher
for those of females. The LFPRs dropped significantly in 2017 due to the economic downturn caused by
the natural disasters of said year. In this year, LFPR dropped to around 60% and that of females was higher
than that of males.

382024 Minimum Wage Advisory CommitteeStandard of Living, Cost of Living and Living Wage Analysis
Standard of Living
The standard of living in the Virgin Islands is characterised by its high cost of living, compared with thehigh quality of life and natural beauty that attract both residents and visitors. The territory boasts a
relatively high GDP per capita, reflecting its successful financial services and tourism industries. However,the benefits of this economic success are not uniformly distributed, with significant disparities in income
and living standards. While a segment of the population, particularly in the financial services sector, enjoys
a high standard of living with access to better housing, private education, and healthcare, there are also
those in lower-wage jobs who struggle to meet daily living expenses.
In measuring its standard of living, the cost of living in the Virgin Islands is among the highest in the
Caribbean due to its reliance on imported goods and the premium placed on real estate, particularly inareas popular with expatriates and tourists. Housing, groceries, utilities, and transportation are major
expenses that can consume a significant portion of household income. Despite these costs, the Virgin
Islands offers a high quality of life regarding safety, community, and access to natural amenities likebeaches, marine activities, and a temperate climate. The Government provides public services such as
education and healthcare, but the quality and availability can vary depending on the needs of people,
leading some residents to seek private options, often at a higher cost.
Addressing the standard of living in the Virgin Islands requires a balanced approach that promotes
economic growth while ensuring the gains are equitably shared. Efforts to improve the standard of living
include investing in public services, enhancing infrastructure, and promoting sustainable developmentthat benefits all sectors of society. The challenge for the Virgin Islands lies in leveraging its economic assets
to improve living standards across the board, ensuring that residents can enjoy the territory's wealth andnatural beauty without being overburdened by the high cost of living.

Cost of Living
The cost of living in the Virgin Islands is influenced by several factors, making it one of the higher-priced
territories in the Caribbean. The islands' location and dependence on imports for most goods and services
contribute significantly to the overall cost of living. Food, housing, and consumer goods prices are higher
than in many other parts of the Caribbean and even compared to some cities in the United States andEurope. These prices are partly due to the additional shipping costs, import duties, and the limited local
production of goods.
Housing costs in the Virgin Islands are also notably high, driven by the premium real estate market andthe islands' appeal as a luxury tourist and expatriate destination. Rental prices for apartments and homes
can vary widely depending on the location, with prime areas commanding significant premiums. The
aftermath of hurricanes Irma and Maria has further strained the housing market, leading to demand for
habitable accommodations and, consequently, rising rental costs.
Utilities and services in the Virgin Islands, including electricity, water, and telecommunications, also add
to the cost of living. The islands' reliance on fossil fuels for electricity generation results in higher energy
costs for residents. Additionally, the limited scale of local infrastructure and services means that many
amenities are more expensive than in larger economies. This includes everything from internet services
to healthcare and education, which can be costlier than in more developed countries with more extensive
public service systems.
Transportation in the Virgin Islands involves unique challenges and expenses. The archipelagic nature of
the territory means that inter-island travel often requires boats or ferries, adding to the cost andcomplexity of daily commutes and logistics. The price of vehicles and fuel are other factors in the39

2024 Minimum Wage Advisory Committee

consideration of expenses related to transportation. These factors combine to make transportation asignificant component of the cost of living in the Virgin Islands, especially when access to public
transportation, like in other Caribbean countries, is not easily accessible.
The cost of food and groceries in the Virgin Islands reflects the islands' import reliance, with prices foressential commodities often much higher than in larger countries. Supermarkets and grocery stores carrya wide variety of imported products, which can be costly due to customs duties, shipping fees, and thesmall-scale economy. While local produce and seafood are available at times, the selection is limited
compared to imported goods.
Despite the high cost of living, the Virgin Islands offers significant advantages, such as its natural beauty,
relaxed lifestyle, and tax benefits, attracting expatriates and professionals. To manage the high living
costs, individuals and families often need to plan and budget carefully. The Government and local
businesses are also aware of these challenges and periodically assess the need for wage adjustments andother measures to improve affordability for residents. The high cost of living thus remains a critical issue
for the Virgin Islands, having to balance maintaining an exclusive economic profile and ensuring asustainable life for its residents.
Cost of Living Calculations
The cost of living is calculated by assessing the total amount of money needed to cover the basic expenses
using a selected basket of goods and services. Some important areas to consider when calculating the costof living are:
i.

ii.
iii.
iv.
v.

The housing cost is the largest single expense in the calculation. This expense may include
rent for apartments or homes, mortgage payments, property tax, homeowner’s insurance,and maintenance costs.
The transportation expenses include the cost of taxis, buses, boats and ferries, and personalvehicles, including gas, insurance and maintenance.
Food and grocery prices are an essential part of daily living expenses needed to maintain astandard of living. These prices include meals, snacks, and non-alcoholic beverages.
Healthcare costs include health insurance coverage, doctor’s visits, medications, and hospital
services.
Other areas include education, utilities, taxes, and personal expenses.

This selected basket of goods and services is a critical tool to determine an average household's basic
needs and associated costs in a specific location. It comprises a set of goods and services consideredessential for a household to maintain a decent standard of living, including items like food, housing,healthcare, education, and transportation. In the context of the Virgin Islands, establishing a locally
relevant selected basket is essential due to the unique economic factors influenced by its status as anisland economy with a high dependence on imports and tourism.
The importance of the selected basket for the Virgin Islands lies in its ability to provide a comprehensive
and tangible measure of the cost of living. By quantifying how much a typical family needs to spend tomeet basic living standards, policymakers and economic analysts can assess whether the prevailing wage
levels are adequate. In places like the Virgin Islands, where the cost of living is relatively high, the selectedbasket helps highlight the discrepancies between earnings and the actual cost required to live
comfortably. This is particularly significant given the high housing prices, imported food items, and otheressentials that can strain household budgets.

40

2024 Minimum Wage Advisory Committee

Connecting the selected basket to understanding minimum wage in the Virgin Islands is important fordeveloping effective wage policies. If the minimum wage is below the level suggested by the selectedbasket, it indicates that workers earning the minimum wage cannot afford essential goods and services
for a basic standard of living. This connection aids in advocating for realistic wage adjustments that reflect
the true cost of living and supports efforts to ensure that all workers receive fair compensation that aligns
with the economic demands of their environment. Therefore, using a selected basket is not just a tool formeasurement but a foundational element in the dialogue about economic justice, wage policies, andsocial equity in the Virgin Islands.

Living Wage
In the Virgin Islands, the living wage concept is particularly significant given the territory's high cost ofliving. The Virgin Islands' economy, heavily reliant on tourism and financial services, presents a uniquelandscape for discussing living wage. While these sectors generate substantial income, the benefits are
only sometimes evenly distributed among the workforce, often necessitating a re-evaluation of wage
standards to ensure that employees can afford a decent standard of living.
The living wage in the Virgin Islands would need to be calculated based on the local cost of living,influenced by factors like expensive housing, high prices for imported goods, and utility costs. For many
workers in the Virgin Islands, especially those in lower-wage jobs within the tourism and service sectors,
the current minimum wage of $6.00 an hour does not suffice to cover these basic living expenses.
Establishing a living wage in the Virgin Islands would involve comprehensive analysis to determine theincome needed to meet the basic needs of individuals and families, factoring in the territory's uniqueeconomic conditions.
While the living wage is an important consideration for basic survival, implementing a living wage in the
Virgin Islands faces challenges. Businesses and small local enterprises may need help with the increased
financial burden of higher wages. There is a concern that this could lead to job losses, reduced hours, orincreased prices for services and goods. However, proponents argue that a living wage could lead to amore sustainable and equitable economy, reducing income inequality, enhancing worker productivity andsatisfaction, and decreasing reliance on social assistance programmes.
The Living Wage Basket (LWB) shows the results of the rate needed, depending on the structure of thehousehold, ranging from $12.31 to $16.86 per hour.

Living Wage Rates (2022)

Monthly Income
Weekly Income
Daily Income
Hourly Income

Monthly Cost: Monthly Cost: Monthly Cost: Monthly Cost: Monthly Cost:
Monthly Cost: Monthly Cost: Monthly Cost: Monthly Cost: Monthly Cost:
General
One Woman, One Woman,
Two Adults,
Two Adults,
Two Adults,
One Man
One- Woman Two Adults
One Man, One One Man, Onemonthly cost
One Boy
One Girl
One Boy
One Girl
One Boy, One
HouseholdHouseholdHouseholdBoy Household Girl Household
HouseholdHouseholdHouseholdHouseholdGirl Household
2,680.45
2,567.30
2,583.59
3,277.35
2,711.89
2,717.10
2,728.18
2,739.94
3,376.36
3,369.75
3,516.11
616.80590.77594.51754.16624.04625.24627.79630.49776.94775.42809.10102.8098.46
99.09
125.69104.01104.21104.63105.08129.49129.24134.85
12.85
12.31
12.39
15.71
13.00
13.03
13.08
13.14
16.19
16.15
16.86

Assumption: the factors assumed that a woman consumes 75% and a child consumes 50% of a man’s level ofconsumption of most food items. For some other items, a woman’s consumption equates to that of a man. For someother items, there is no consumption by children.

412024 Minimum Wage Advisory Committee

Living Wage Basket
The LWB (see Appendix 4) accounts for a broader and more comprehensive range of goods and services
that reflect a decent standard of living. The considerations in this basket go beyond surviving to ensure
protection against poverty. The living wage is intended to provide workers with income that is sufficientto accommodate a decent standard of living for themselves and their families, including the ability to save,
invest in education, and take vacations. More extensive items are included in the basket. The living wage
is generally higher than the minimum wage and is not always mandated by law.

Cost of Living EffectAnalysing the effects of minimum wage adjustment in the Virgin Islands created an opportunity tounderstand the immediate financial impact and the broader economic implications, including inflationarypressures. Increasing the minimum wage directly enhances minimum-paid workers' purchasing power,
enabling them to afford necessities. In the Virgin Islands, where the cost of living is relatively high,especially in terms of housing and imported goods, a wage adjustment could significantly improve thequality of life for low-income workers within the territory. Furthermore, meeting basic needs without
financial strain can enhance employees' and their families' health, productivity and overall well-being.
Higher wages increase disposable income, stimulating demand for goods and services. In the Virgin
Islands' economy, where consumption is a significant driver, this increased spending can support local
businesses and contribute to economic growth. However, the boost in demand must be managed
carefully to ensure that it does not lead to excessive price increases, particularly in sectors with limitedcompetition or supply constraints.
Another consideration is the effect of wage adjustments on affordability and inflation, which can varyacross different sectors. For example, in the tourism sector, increased wages could lead to higher service
costs, potentially affecting the sector's competitiveness. In contrast, the impact might be less pronounced
in industries like agriculture or manufacturing, if these sectors are less labour-intensive.
While wage increases can improve workers' ability to afford necessities, there is also the potential for
inflationary pressures to arise. If businesses face higher labour costs, they might pass these costs onto
consumers through higher prices, leading to a general rise in the price level. This inflationary effect must
be carefully monitored to ensure that the real purchasing power of the wage increase is not eroded,
particularly for low-income workers who spend a significant proportion of their income on essential goods
and services.
A critical risk of wage adjustments is the potential for a wage-price spiral, where wage increases lead tohigher prices and further wage demands, creating an inflationary cycle. In the Virgin Islands, balancing
improving workers' living standards and avoiding unsustainable inflationary pressures is crucial.
Policymakers must monitor economic indicators and adjust policies accordingly to mitigate these risks.
Ultimately, the goal of minimum wage adjustments should be to achieve long-term economic stability andsustainably improve living standards. This involves addressing immediate financial needs and ensuring the
economy remains competitive, diversified, and resilient to external shocks. In the Virgin Islands, this could
mean investing in skills development, enhancing productivity, and supporting sectors that absorb higher
labour costs without significant price increases.

422024 Minimum Wage Advisory Committee

Social Considerations
The Role of Minimum Wage in Reducing Poverty and Income Inequality
In the Virgin Islands, the role of the minimum wage in addressing poverty and income inequality isparticularly significant due to the territory's economic structure and the cost of living. Given its economic
composition, the Virgin Islands features a labour market with a wide range of income levels, from highearning professionals in the financial sector to lower-wage workers in the service industry. The minimum
wage is a fundamental tool in ensuring that workers in the latter category earn a living wage that reflects
the cost of living associated with an island economy that depends on imports for most goods and services.
By setting a base level for wages, the minimum wage policy aims to lift the lowest-paid workers out ofpoverty and reduce the gap between the highest and lowest earners, thereby contributing to a more
equitable distribution of income.
The real impact of the minimum wage in reducing income inequality in the Virgin Islands also depends on
its alignment with the actual cost of living. An adequately set minimum wage can ensure that all workers
have enough income to meet basic needs, such as housing, food, and healthcare, which are notably
expensive in the territory. This wage not only improves the standard of living for low-wage workers but
also supports social cohesion by mitigating the social divide that income inequality can create. However,the challenge is evident in finding the right balance, where the minimum wage is high enough to provide
for a decent standard of living without imposing undue burdens on employers, especially small businesses,that are vital to the Virgin Islands' economy.
Therefore, the role of the minimum wage in reducing poverty and income inequality extends beyond
immediate financial effects. It has broader socio-economic implications, including promoting. When lowincome workers have more disposable income, they are most likely to spend it on goods and services,thus stimulating the economy.
A fair minimum wage policy can also enhance worker productivity and morale, reduce employee turnover,
and attract a more skilled workforce to the territory. Through these mechanisms, the minimum wage
serves as a direct intervention to uplift the living standards of the lowest-paid workers and as a strategic
tool for fostering sustainable economic growth and social well-being in the Virgin Islands.

Gender and Age Considerations in Minimum Wage Policies
Like many other regions, gender and age considerations are critical in shaping effective minimum wage
policies. These factors are essential given the diverse demographics of the workforce and the varying
economic roles played by different groups within the society. For instance, women, who often juggle
multiple responsibilities, including work and caregiving, may disproportionately occupy part-time orlower-wage positions, especially in sectors like tourism and retail. A minimum wage policy that adequatelyreflects the cost of living in the Virgin Islands can significantly impact these workers by ensuring theyreceive fair compensation, which is crucial for promoting gender equality in the workplace and thebroader economy. Furthermore, considering the gender wage gap that exists globally, including in
advanced and developing economies, instituting a robust minimum wage can be a step towards narrowing
this gap in the Virgin Islands, thereby enhancing economic empowerment for women.
Age is another crucial factor in the formulation of minimum wage policies. The Virgin Islands' workforce
includes young workers, who are often entering the job market for the first time, and older workers, who
may face challenges in employment due to age discrimination or the rapid pace of technological change
affecting job requirements. Young workers, especially those in tourism and service industries, may findthemselves in low-wage jobs that offer limited prospects for advancement. A minimum wage policy that43

2024 Minimum Wage Advisory Committee

considers the needs of these workers can ensure that they are adequately compensated; helping toprevent exploitation and encouraging them to participate in the labour market. A fair minimum wage isequally important for older workers, as it provides them with financial security, particularly for those who
may not have substantial retirement savings. Ensuring these workers are not left behind in the Virgin
Islands' economic growth is essential for fostering a society that values inclusivity and intergenerational
equity.

Addressing gender and age considerations in minimum wage policies requires understanding the labour
market and the socio-economic conditions in the Virgin Islands. Policymakers must collect and analyse
comprehensive data to identify wage disparities and understand their root causes. Such efforts should becomplemented by broader labour market reforms that promote equal opportunities and nondiscrimination. For example, initiatives that support workforce development, provide access to childcare,and encourage lifelong learning can enhance the effectiveness of minimum wage policies. By adopting an
inclusive approach to policy formulation, the Virgin Islands can ensure that its minimum wage framework
supports economic development and advances social justice by addressing the unique needs andcontributions of different demographic groups within the workforce.

44

2024 Minimum Wage Advisory Committee

SECTION 4: SELECTED REGIONAL COMPARISONS
Sectoral and Regional Analysis
Differences in Cost of Living, Productivity, and Economic Conditions
In the Virgin Islands, the relationship between the cost of living, productivity, and economic conditions
presents unique challenges and considerations for policymakers, particularly when viewed acrossdifferent regions of the territory and sectors of the economy. The Virgin Islands' economy is a bit diverse,with a strong emphasis on financial services and tourism, yet it experiences varying economic conditions
across its islands and sectors. These variations significantly influence the cost of living for residents andthose living on the sister islands, who may face higher costs for basic goods and services due to additionaltransportation and importation costs. Such disparities necessitate a nuanced approach to economic andwage policies to ensure equitable living standards across the territory.
Productivity levels across different sectors in the Virgin Islands also contribute to the territory's economic
dynamics. The high-value financial services sector, which demands specialised skills and offers high-wagejobs, contrasts sharply with the more labour-intensive tourism and service sectors, where wages may belower, and productivity gains are achieved differently, often through service excellence and operational
efficiencies. These sectoral differences in productivity have implications for wage policies, including
minimum wage settings, which should consider the economic value generated per sector and thecorresponding ability to pay wages that reflect the cost of living in the Virgin Islands. Balancing these
considerations is crucial for fostering a fair and sustainable economic environment that supports growthand competitiveness, while ensuring that workers in all sectors can meet their basic needs.
Furthermore, the economic conditions unique to the Virgin Islands, including its susceptibility to external
economic shocks and natural disasters, play a critical role in shaping the territory's labour market andwage policies. Economic resilience and sustainability are essential, requiring policies that support sectoral
growth and diversification while ensuring that wage levels are responsive to changes in the cost of living
and productivity. Adopting a flexible, evidence-based approach to wage setting, which accounts for thedifferences in economic conditions across the sister islands and sectors, can help the Virgin Islands
navigate the challenges of maintaining competitiveness and attracting investment, while promoting social
equity and improving living standards for all residents. In this context, wage policy development andimplementation must be strategic and adaptive, reflecting the complex interplay of factors that define
the Virgin Islands' economic landscape.
Compared to the broader Caribbean region, the Virgin Islands often exhibits a higher cost of living,reflecting its firm reliance on the financial services and tourism sectors, which generate relatively highincome but also increased prices for real estate, services, and goods. This contrasts with larger Caribbean
economies, which might benefit from more diversified economies and larger domestic markets that can
support local production and reduce import reliance. However, like many of its regional neighbours, theVirgin Islands faces the challenge of balancing sector-specific productivity with wage policies that reflect
the cost of living and economic conditions. In tourism, for example, the Virgin Islands competes with other
Caribbean destinations on the quality of services and cost, making productivity improvements essential
for maintaining competitiveness while supporting fair wages.
Notwithstanding the high cost of living, the economic conditions in the Virgin Islands, characterised by its
small size and vulnerability to external shocks such as hurricanes or global financial changes, further
complicate this balance. These conditions often necessitate a more dynamic approach to economic policy
and wage setting than might be required in the region's more stable, larger economies. The Virgin Islands'
focus on financial services, tourism, and the service sectors requires policies that support resilience and452024 Minimum Wage Advisory Committee

adaptability, ensuring that wage policies reflect the basic cost of living and productivity and safeguard theeconomy against such shocks. This approach contrasts with economies in the region that may have abroader industrial base or larger agricultural sectors, where wage policies can be more directly tied to
productivity metrics and may not need to account for the same level of vulnerability to external
influences.

Regional Comparisons
Review of Minimum Wage Policies in Other Countries
Reviewing minimum wage policies in countries with similar economic conditions to the Virgin Islands
provides valuable insights into how different jurisdictions balance economic growth, competitiveness, andsocial equity. Small island economies often share common challenges, including vulnerability to external
economic shocks, reliance on a limited number of sectors, and high costs of living due to importdependence, among other areas. This comparison sheds light on varied approaches to the minimum wage
policy and its implications for similar economies.

Cayman Islands
One comparable jurisdiction is the Cayman Islands, renowned for its financial services sector, much likethe Virgin Islands. The Cayman Islands proposed implementing a minimum wage, considering the highcost of living and the need to attract skilled labour to sustain its economic pillars. Unlike the Virgin Islands,
which is also trying to balance its wage policies with economic growth in its economic pillars, tourism andfinancial services, the Cayman Islands' approach reflects an understanding of the unique demands of its
key economic sectors. By setting a minimum wage to ensure a decent standard of living for workers, theCayman Islands maintains a balance between attracting global talent and supporting local employment
standards.
As reported by Cayman Compass, the proposed new minimum wage for the Cayman Islands is $8.75 perhour. This new proposed rate represents an almost 50% increase (at $6.00 per hour). The Compass further
stated that the change will benefit 10,457 workers, including over 2,000 Caymanians. It added that while
the new minimum wage is proposed, the actual living wage in the Cayman Islands is around $10.38 to$16.95 per hour.
The article further recommended phasing out the loophole that allows hospitality businesses to use
gratuities for up to 25% of their employee's wages. It went on to state, "Initially hotels and restaurants
will be allowed to pay a lower rate of $6.56 an hour with the rest made up by gratuities. However, theallowable gratuity contribution will drop by 5% for the next five years”.
The recommendation from the minimum wage review also suggested creating a formula to automaticallyincrease the minimum wage, which is linked to the Consumer Price Index (CPI), as well as implementing afull review every four years.

BermudaSimilarly, Bermuda, another territory with a significant financial services sector and tourism industry,offers insights into managing minimum wage policy amid high living costs. Bermuda has historically had
high-income levels to match its cost of living, one of the highest in the world. The territory's approach to46

2024 Minimum Wage Advisory Committee

minimum wage is designed to prevent poverty and ensure that all workers can afford basic living
standards without compromising its appeal to international businesses and investors. Bermuda's strategy
highlights the importance of aligning wage policies with overall economic goals, including maintaining acompetitive advantage as a business hub while ensuring social equity. A Guide to the Minimum Hourly
Wage Rate, produced by the Ministry of Economy and Labour, Government of Bermuda, provides
additional insights. While the cost of living is high, the impact of the minimum wage on unemployment
and inflation would be critical to assess relative to the high baseline.
According to the document, A Guide to Minimum Hourly Wage Rate, the minimum hourly wage rate is$16.40, driven by the high cost of living. The Wage Commission of Bermuda also suggested a wage floor
for low-paid workers, such as domestic workers and hospitality workers, at 50% of the median hourly
wage ($15.75 per hour). It was further recommended that the minimum hourly wage be adjusted by an
inflation uplift using annual averages from the previous year. Hence, in understanding the hourly rate of$16.40, the commission rate in 2021 was $15.75, in addition to an inflation uplift of the annual average
from 2021 to 2022. For 2023 the proposed wage will be capped at an inflation uplift of 2.5%, arriving at$16.40 in June 2023.
The article further explained that if a person receives payment in the form of gratuities or service charges
or is a personal service employee, then the employer is entitled to use a basic wage, gratuities, service
charges and/or commission received to make up the difference in the wage as a means of ensuring that
employees are compensated at the minimum. If, after combining the gratuities, service charges and/or
commissions, the employee’s wage does not reach the minimum hourly wage, the employer is responsible
for the difference.

BahamasLike the Virgin Islands, the Bahamas is a small island economy with a heavy reliance on tourism andfinancial services, facing similar challenges, such as high living costs and vulnerability to external economic
shocks. The Bahamas has periodically adjusted its minimum wage to reflect changes in the cost of living
and economic conditions, recognising the importance of ensuring that wages keep pace with living
expenses to support the well-being of its workforce.
Comparatively, the Virgin Islands might draw lessons from the Bahamas' experience by considering how
periodic, data-driven adjustments to the minimum wage could better align with the territory's economic
realities and living costs. Both jurisdictions strive to balance maintaining competitive businessenvironments and ensuring that workers in key economic sectors like tourism and other service sectors
can achieve a decent standard of living. The Bahamas' approach to adapting its minimum wage policy inresponse to economic indicators and social needs offers a valuable comparative perspective for the Virgin
Islands, highlighting the importance of flexibility and responsiveness in wage policy to support economic
resilience and worker welfare.
In 2022 the Prime Minister and Minister of Finance of the Bahamas, Hon. Philip Davis, announced that theminimum wage will increase from $210 per week (2015 level) to $260 per week to take effect in January
2023. Hon. Davis further expressed that their shared goal was to implement the increase without having
a negative impact on employment or job growth.
In addition to the increase in the minimum wage rate, Hon. Davis announced a temporary price control
on certain items, including eggs, bread and diapers. This temporary price control will last for a period of
six months, and will be reviewed thereafter.
47

2024 Minimum Wage Advisory Committee

Turks and Caicos Islands
The Turks and Caicos Islands (TCI), sharing similar economic underpinnings with the Virgin Islands throughtheir reliance on tourism and financial services, offer a relevant case study in applying minimum wage
policies under comparable economic conditions. The TCI has adjusted its minimum wage to reflect the
territory's economic realities, including the high cost of living and the need to ensure that wages are
sufficient for workers to live decently. This approach underscores the balance between attracting andretaining a workforce capable of supporting key sectors while ensuring economic growth does not comeat the expense of living standards.
For the Virgin Islands, observing the TCI's strategy in calibrating minimum wage levels provided insights
into managing the link between maintaining a competitive business environment, attracting foreign
investment, and upholding the welfare of workers. The experience of the TCI highlights the importance ofa proactive approach to the minimum wage policy geared towards the specific needs and challenges ofsmall island economies.
The minimum wage in the TCI increased from US$6.25 per hour to US$8.00 per hour from April 1, 2023.
Following extensive consultation, three options were considered: $7.25 per hour, $8.00 per hour, and$8.25 per hour. However, $8.00 per hour was the agreed decision from the Cabinet. The increase will
cover all categories of workers, excluding workers in security, manufacturing, construction, banking,financial services and insurance sectors, who will see a new rate of US$9.00 per hour.
In addition to the increase in the minimum wage level, the Government will develop its social programmes
to complement the minimum wage index with the introduction of a Living Wage Support System(including a National School Nutrition Programmes, a National Day Care Programmes, and an After School
Programme) to take effect on September 1, 2023.

Anguilla
Like the Virgin Islands, Anguilla is a small island economy where tourism plays a pivotal role, alongside a
growing interest in financial services. Anguilla's approach to a minimum wage policy has carefullybalanced the need to provide a living wage that reflects the cost of living, which is inherently high in island
economies due to import dependence, against the imperative to remain competitive as a tourist
destination and a jurisdiction for financial services.
The territory's efforts to periodically review and adjust the minimum wage in consultation with key
stakeholders, including businesses and worker representatives, mirror a strategy that could be highly
relevant for the Virgin Islands. This approach ensures that wage policies are responsive to the evolving
economic landscape and workers' living needs while supporting the sustainability of businesses. Anguilla's
experience emphasises the importance of adaptability and stakeholder engagement in shaping minimum
wage policies that fulfil economic and social objectives. It offers a model that the Virgin Islands might
consider in its policy reviews to ensure that its workforce is fairly compensated without compromising
economic growth.
In 2023, there was a proposal of a US$6.00 per hour minimum wage rate. However, much debate has
surfaced in relation to the establishment of a fair wage. According to an article released by The
Independent Newspaper of Anguilla, many governments have tried to establish a minimum wage but havenot been able to deliver it successfully. Part of the argument surrounds what would be the best approach48

2024 Minimum Wage Advisory Committee

for the island, whether one general rate, or a rate by industry, occupation, etcetera. Persons have also
indicated the need for a liveable wage rather than a minimum wage

Barbados
Barbados, an island economy with a strong reliance on tourism, much like the Virgin Islands, has
implemented minimum wage policies to safeguard workers' rights while fostering economic growth.
Barbados's approach to minimum wage adjustments considers the need to balance improving living
standards for low-income workers with the operational realities of businesses in key economic sectors.
The country's efforts to engage in comprehensive stakeholder consultations before implementingchanges reflect a commitment to ensuring that wage policies support social and economic objectives. Thismethodology provides a valuable perspective for the Virgin Islands, suggesting that stakeholder
engagement and a balanced approach to policy formulation can help align minimum wage adjustmentswith the broader goals of economic competitiveness and social equity. Barbados' experience underscores
the importance of creating a policy environment supporting sustainable economic development while
ensuring workers enjoy a decent quality of life. This principle could guide the Virgin Islands in refining its
wage policies.

492024 Minimum Wage Advisory Committee

Other Caribbean
As reported by wicnews.com, in their December 2023 issue, 6 Caribbean countries increased theirminimum wage and public workers' salaries during the 2024-2025 budget cycle. These countries are
Antigua and Barbuda, Anguilla, Dominica, Grenada, St. Kitts and Nevis, and St. Vincent and the Grenadines.
•
•
•
•
•

•

Antigua and Barbuda announced a 14% increase in the salaries of public sector workers
Anguilla established a National Minimum Wage effective January 1, 2024, set at EC$16.20 or
US$6.00 per hour.
Dominica announced plans to increase the salaries of the public service, ranging between 6% and13%.
Grenada’s Government placed a minimum cap on the salaries of all working individuals who will
receive at least EC$1,200.00. This means the minimum wage of $60.00 per day should be paid.
St Kitts and Nevis realised an increase in January 2024 from EC$9.00 to EC$10.75 per hour. In
addition to increasing the minimum wage, the Government added a new pension plan for
Government Auxiliary Employees who were hired prior to May 18, 2012, and also an 8% increase
for civil servants and pensioners.
In St Vincent and the Grenadines, the Government gave a 2.5% increase from January 2023 andanother 2% increase from January 2024. The Government also intends to give another 2.5% salary
increase from January 2025.

Fundamental to these wage increases is ensuring that the wage structures reflect current realities. Froma tourism perspective, minimum wage increases across the region typically raise the labour cost in
tourism. Where minimum wages rose in the region, businesses may have faced higher operational costs
affecting pricing and competitiveness. Regarding the sector responses, some tourism businesses
responded by increasing automation or reducing staff hours, potentially impacting service quality andemployment levels.
Comparing these jurisdictions with the Virgin Islands, it is evident that while the contexts and economic
structures have similarities, each territory tailors its minimum wage policies to its specific economic
conditions, sectoral composition, and social needs. For the Virgin Islands, adopting a flexible and sectorspecific approach to minimum wage policy, similar to these comparisons, could enhance its ability tosupport workers' livelihoods without hindering economic competitiveness. Learning from the experiencesof these jurisdictions, the Virgin Islands can explore innovative ways to adjust its minimum wage policies,
ensuring they effectively address the high cost of living and support economic resilience, while fostering
a fair and equitable labour market for all sectors.

50

2024 Minimum Wage Advisory Committee

Lessons Learned and Best Practices
In the context of the Virgin Islands, lessons learned, and best practices from around the region in setting
and adjusting minimum wage, highlight the importance of a balanced, evidence-based approach. One key
lesson is the necessity of regular, comprehensive reviews of the minimum wage that consider the cost ofliving, economic growth, and productivity levels. For the Virgin Islands, with its economy heavily reliant
on tourism and financial services, it's crucial that these reviews also consider the specific economic
conditions and sectoral needs. Stakeholder engagement is essential in this process, ensuring that theperspectives of employers, workers, and other community members are considered. This inclusive
approach facilitates the development of a minimum wage policy that supports workers' well-being, while
maintaining the competitiveness of businesses and the broader economy.
Another best practice is implementing a mechanism for automatic adjustments to the minimum wage
based on clear, predetermined criteria such as inflation rates and changes in the cost of living. Such amechanism can provide predictability for businesses and workers alike, reducing the need for frequentad-hoc adjustments that can disrupt economic stability. Adopting a formula-based approach to minimum
wage adjustments for the Virgin Islands could help align wage growth with economic realities, ensuringthat wages remain relevant over time without requiring constant intervention. This approach also helps
depoliticise the wage adjustment process, making it more transparent and objective.
Furthermore, considering the high import dependence and the unique economic vulnerabilities of small
island economies like the Virgin Islands, it's essential to closely monitor the impact of minimum wage
adjustments. Post-implementation reviews can assess the effects on employment, poverty levels, andoverall economic performance, allowing for data-driven refinements to wage policies. Adopting a phased
implementation strategy for significant adjustments can also mitigate potential negative impacts on
employment and business operations. These practices ensure that minimum wage policies are responsive
to the immediate needs of workers and contribute to the long-term sustainability and growth of theeconomy; reinforcing the Virgin Islands' commitment to social equity and economic resilience.

512024 Minimum Wage Advisory Committee

SECTION 5: STAKEHOLDER CONSULTATION ANALYSIS
Stakeholder Perspectives
During the minimum wage review process, opportunities were made available for active participationfrom the stakeholders. A meeting was held with the BVI Chamber of Commerce and; media appearanceswere made on the UMOJA show, Tola radio and 284 Media Report. Additionally, persons were encouraged
to submit written suggestions, comments and feedback to the Ministry at mfslt@gov.vg. The Ministry also
allocated one hour daily from 4 pm to 5 pm for 2 weeks, April 8th, 2024 – April 19th 2024, for one-on-one
or group consultations.
The engagements were held with a broad spectrum of stakeholders, including employees earning at andabove the minimum wage, employers, interest group representatives, government agencies, anddecision-makers. There was unanimous agreement among these groups that the current minimum wageof $6.00 per hour is insufficient, underscoring the urgent need for an increase to better combat the highcost of living in the territory. Stakeholders strongly advocated for improved wage conditions for thoseearning the minimum wage to alleviate financial pressures and improve overall living standards.
Concerns were highlighted regarding the socio-economic challenges various family structures face within
the community. Individuals with dependents, particularly those with children, are often compelled tomake tough financial choices to meet family needs. Similarly, single individuals and the uneducated facesignificant difficulties in managing their finances, with a focus on essential spending. These groups
frequently rely on the Government’s social assistance programmes, which, while designed to support suchneeds, are at risk of becoming unsustainable due to the increasing demand from those earning minimum
wage or lower. This underscores the critical need for a sustainable approach that addresses both theinadequacy of the minimum wage and the capacity of social support systems to handle the growing needs
without compromise.
From the business community's perspective, especially small business owners, there is considerable
anxiety about the potential economic repercussions of minimum wage increases. Employers are
particularly concerned that substantial wage increases could threaten the viability of small businesses,
which are integral to the economic fabric of the territory. The risk of a multiplier effect on the economy
looms large, prompting discussions on the necessity of a well-considered strategy. Such a strategy would
need to be balanced enhancing workers’ welfare while maintaining the economic health andcompetitiveness of businesses, ensuring that wage adjustments do not inadvertently destabilise thebroader economic landscape of the Virgin Islands.
Addressing the high cost of living in the Virgin Islands was another central theme during the interactions
with stakeholders. Several participants highlighted the need for measures specifically targeting the risingcosts associated with housing. There was a strong recommendation for introducing a rental cost index to
track and manage the escalating rental prices, which significantly contribute to the living pressures facedby residents, as it accounts for the highest single share of workers' basic expenses.
There is an expressed need for the Government to examine the cost of doing business in the Virgin Islands
and identify ways to support small businesses, whether through facilitating access to low-interest loans
to cover the operating cost or through the identification of mechanisms, programmes, and/or structures
to assist businesses in lowering their operating costs.
In discussions about the broader economic implications of a minimum wage increase, some stakeholders
expressed concern over the potential for increased remittances leading to capital outflow from theterritory. However, others argue that earnings should be regarded as the employee's personal property,522024 Minimum Wage Advisory Committee

who should have the autonomy to spend their income as they see fit, emphasising personal responsibility
and economic freedom.
Trade relations and import policies were also discussed as avenues to mitigate the high cost of living.
Stakeholders suggested enhancing trade relationships to give consumers access to a wider range of goods
at competitive prices. Additionally, there were calls for re-evaluating port charges, particularly containersurcharges and identifying a solution to address the high shipping costs that contribute to inflated prices.
Finally, several constructive recommendations emerged from the discussions aimed at supporting
minimum wage earners. These included a proposal to increase the tax break threshold from $10,000 to$15,000 only for persons at minimum wage, thereby providing additional disposable income andalleviating some financial burden. Further analysis would be needed to understand the full implicationsof such an initiative.
There was also a strong push for strengthening the monitoring of retailers to prevent price gouging,ensuring that any minimum wage increase would positively impact the economic well-being of workers
across the territory.
These recommended views from stakeholders reflect a collective desire to balance economic growth withsocial equity, and support the need for a fair approach towards minimum wage policy.

53

2024 Minimum Wage Advisory Committee

SECTION 6: RESULTS OF FINDINGSMinimum Wage Results from Surveys
Both an employee and an employer survey were done to inform any decisions made concerning themodification of the minimum wage in the Virgin Islands. Random samples were used in the collection ofdata (see Appendices 5 and 6 for data tables).

Employees
Demographics and Other Statistics
•
•

•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•

Over 80% of respondents to the survey worked on Tortola, the main Island of the Virgin Islands.
Virgin Gorda was represented to the tune of 13.2%.
For various reasons, youths are often not as well represented in the working population as theirmore mature counterparts. Of the respondents to the survey, 73.3% were from the main working
age group (30 – 64 years old). Just over 24% of respondents were from the young segment of the
population.
For females, issues relating to equality in remuneration and representation in the workforce are
not unfounded. For this survey, more than 77% of the respondents were females.
Persons from the Virgin Islands were most represented in the survey, as they accounted for 55.2%of the respondents. Almost 26% of the respondents hailed from other Caribbean countries, while
just over 10% were from the United States and Territories.
The more educated segment of the population represented the largest group of the survey, with
65.5% of the respondents. Around 27% of the respondents had a secondary school education.
Virgin Islanders by birth or descent accounted for 47.3% of the respondents. This was followed by
19.6% for Belongers and 17.3% for work permit holders.
Persons in the Services sectors represented 68.3% of respondents to the survey.
A mere 1.3% of respondents indicated that they received any Government assistance.
Of those who responded to the question, just under 38% of respondents indicated that they
supplemented their main income with another source of income.
Expectedly, 97.8% of persons who responded to the employee’s survey believed that theminimum wage should be increased. Surprisingly, almost one quarter (23.9%) of respondents did
not state their position.
Employees who responded to the survey stated that their average hourly rate of pay was $16.10,
and they worked on average 39.75 hours a week. These employees proposed that the averageminimum wage should be $11.09. Recommendations ranged from $6.00 to $20.00 an hour.
Practically no one in all the islands of the Virgin Islands who responded to the survey received any
Government assistance.
Almost 40% of respondents living in Tortola had another source of income, and this compares to34.1% of respondents in Virgin Gorda and 20% of those on the other islands.
Under 5% of respondents in all the islands of the Virgin Islands disagreed with the minimum wage
remaining at $6.00 per hour.
An insignificant percentage of the age groups, except for those 65 years and older, received any
Government assistance. Exactly 10% of the older respondents received assistance.
Of respondents 65 years and older, 70% of them had another source of income. Such was not thecase for over 60% of the other age groups.
Practically all respondents from all the age groups thought that the minimum wage should be
increased. A meagre 3.9% of those 30 – 49 years old thought otherwise.
A very insignificant percentage of males and females benefitted from Government assistance.
54

2024 Minimum Wage Advisory Committee
•
•
•
•

•
•
•

•
•
•
•
•
•
•
•
•
•
•

•

A more substantial percentage of males than females (47.4% versus 35.2%) indicated that they
had another source of income.
There was a marginal gap between the percentages of males and females who thought that theminimum wage should remain the same. Under 4% of males and 1.8% of females shared thissentiment.
Just under 16% of respondents from other countries received Government assistance. Practicallyno one from the other nationalities benefitted from such assistance.
Exactly 50% of respondents to the survey from Canada had another source of income; this was
also the case 48.3% of respondents from the United States and territories and 41.4% of
respondents from the Virgin Islands. A less significant 15.8% of respondents from Other Countries
had another source.
While marginal percentages of respondents from many countries suggested that the minimum
wage should not remain the same, 25.0% of respondents from Canada and 7.7% from Latin
America thought that it should not be raised.
Although still insignificant, 7.7% of respondents with Primary School education received someGovernment assistance. Such was not the case for practically any of the respondents at the othereducation levels.
A higher percentage of respondents at the higher education levels had another source of income.
Exactly 50% of respondents with Masters, 46.9% with Bachelor’s and 37.1% with Associatedegrees had another source of income. Only 21.4% of respondents with only Primary education
had another source of income.
Very insignificant percentages of respondents at all education levels believed that the minimum
wage should remain at $6.00.
Regardless of the nationality, hardly anyone benefitted from Government assistance.
Higher percentages who were Naturalized Citizens (55.0%), Virgin Islanders (41.5%) or Belongers(40%) had another source of Income.
Except for the small 6.6% of Belongers who stated that the minimum wage should not be
increased, insignificant percentages of respondents from other nationalities shared that opinion.
Regardless of employment status, practically all respondents did not receive Government
assistance.
While 61.1% of respondents who worked part-time had another source of income, such was thecase for only 36.3% of full-time workers.
Although insignificant, 5.4% of part-time workers thought that the minimum wage should remain
the same. This compares to a meagre 2.1% of full-time workers.
No significant percentage of respondents in any Industry received assistance from theGovernment.
Of respondents to the survey, 46.4% in the industry group non-market services and 45.5% inConstruction had another source of income.
A mere 3.3% of respondents in the industry of Market services thought that the minimum wage
should not change. Respondents in all other industries indicated it should increase.
Respondents who worked on Tortola earned on average $17.29 and worked on average 39.21
hours a week. This compares to $8.58 earned by respondents in Anegada who work 41.18 hours
a week. Respondents from Tortola proposed an average minimum wage of $11.21, while thosefrom Anegada recommended an average minimum wage of $10.05 per hour.
Respondents who were 50 – 64 years old worked for an average of $22.39 per hour and worked
an average of 38.72 hours a week. The young respondents between 18 and 29 years old work for
an average hourly pay of $11.94 and work on average 40.34 hours a week. However, while the552024 Minimum Wage Advisory Committee

•
•

•

•

•

•

young workers suggest the average minimum wage be increased to $11.29, the respondents 50 –64 years old are recommending that it be increased to an average of $10.80 per hour.
Males and female respondents to the survey made, on average, the same per-hour pay at around$16.00. However, while males worked on average 42.7 hours, females on average worked 38.93
hours. Both Males and females proposed an average minimum wage of around $11.00 per hour.
Respondents from Canada earned on average $50.00 per hour and worked on average 64 hours
a week, those from the United Kingdom earned on average $32.67 per hour and worked on
average 44.38 hours a week and respondents from the United States and its Territories earned on
average $24.27 per hour and worked on average 38.56 hour a week. As per the average minimum
wage, Canada, the United Kingdom and the United States and Territories suggested, on average,$11.00 per hour, $12.50 per hour and $10.55 per hour, respectively.
Respondents with Bachelor’s degrees earned an average of $26.25 per hour and worked anaverage of 40.54 hours a week. Those with Masters' degrees made, on average, $24.00 an hour
and worked on average 76.50 hours a week. Employees with a Primary education earned on
average $8.62 an hour and worked for on average 41.64 hours a week. While the respondents
with Bachelor’s and Masters' degrees proposed an average minimum wage of $11.08 per hour
and $10.25 per hour, respectively, the respondents with a Primary education suggested anaverage minimum wage of $11.54 per hour.
Virgin Islanders who responded to the survey had an average hourly rate of pay of $18.35 andworked an average of 39.43 hours a week. Naturalized Citizens and Belongers earned on average$17.85 and $17.35 per hour, and worked on average 36.33 and 41.15 hours per week,
respectively.
Respondents who worked full time earned on average $16.53 an hour and worked on average
40.28 hours a week. On the other hand, part-time workers made, on average, $8.83 an hour andworked 28.87 hours a week. While full-time workers suggest an average minimum wage per hourof $11.10, part-time workers recommend an average $10.63 an hour minimum wage.
Employees in the Mining, Quarrying, Electricity, Gas, and Water industries who responded to thesurvey earned an average of $33.50 an hour and worked 40.00 hours a week. Those in
manufacturing had an average hourly rate of $27.00 per hour and worked on average 42.67 hours
a week. Respondents who work in the Mining, Quarrying, Electricity, Gas, and Water industries
suggested an average minimum wage of $9.00 an hour, while those in Manufacturing proposedan average minimum wage of $10.83 per hour.

Employers••••

Exactly 60% of the businesses operated in Tortola. Unfortunately, only one (1) business from Jost
Van Dyke participated in the survey.
Almost three quarters (74.5%) of employers who responded to the survey were concentrated in
the Market Services industries. Another 10.9% were in the Non-market Services industries.
In response to the question as to whether the existing minimum wage was sufficient to meetneeds, 90.9% of employers thought not. A mere 9.1% said that the existing minimum wage of$6.00 was enough to supply basic needs.
Whereas 32.7% of employers said an increase in the minimum wage would increase their wage
bill and operating costs, and another 21.8% indicated that they would be forced to raise the pricesof their goods and services, a significant 29.1% of employers reported that an increase would havelittle to no impact on their operations. A marginal, yet concerning, 7.3% of them stated that theywould likely have to lay off workers.
56

2024 Minimum Wage Advisory Committee
•
•

•

•
•
•

•
•
•

•

There were 21.9% of employers who responded to the survey still paying the minimum wage.
Unfortunately, a small percentage (3.1%) compensated employees below the minimum wage.
This translated to less than 1% of employees.
Businesses who indicated what was the lowest hourly rate they paid and suggested what they
thought the minimum wage should be paid on average $8.43 per hour and suggested an averageminimum wage of $8.46 per hour. Also, their minimum hourly pay was $5.50, and their maximum
was $20.00; they proposed a minimum of $7.00 and a maximum of $12.00 for the minimum wage.
Over 35% of businesses operating in Anegada who responded to the survey paid employees at
the minimum wage of $6.00 an hour and 7.1% paid below. At these businesses, 24.6% of
employees were paid the minimum wage and 6.6% were paid below. In Tortola, 17.1% were paid
at the minimum and 2.9% were paid below, resulting in 4.2% of employees making the minimum
wage and 0.5% below.
Just over 20% of businesses in the Market Services industries compensated employees at $6.00
per hour, and 4.1% of these businesses below the minimum wage. In this business, 5.4% of
employees made the minimum wage, and 1.1% were paid below.
The majority of businesses in the survey acknowledged that the current minimum wage was notenough to meet basic needs. Of these businesses, 22.4% still paid the minimum wage, and 3.4%
paid below.
Of the businesses that indicated they would have to resort to laying off employees if the minimum
wage was increased, 28.6% of them were compensated at the minimum wage, and 14.3% were
paid below the $6.00 per hour. In these businesses, 32.4% and 11.8% were remunerated at andbelow the minimum wage, respectively.
Businesses in Tortola's average lowest hourly pay was $8.83. The average lowest hourly pay was$7.56 in Virgin Gorda. Employers in Tortola recommended an average minimum wage of $8.72
per hour, while those in Virgin Gorda proposed $7.95.
The average lowest hourly pay for the Market Services industries was $8.06. This compares to$9.50 in the non-market industries. The former proposed an average minimum wage of $8.47,
while the latter recommended $8.00 per hour.
Businesses who thought the minimum wage was sufficient to meet needs had $7.70 as theiraverage lowest hourly pay and proposed an average minimum wage of $7.17. Businesses, on theother hand, who thought the minimum wage was insufficient to meet needs had their lowest
hourly pay at $8.51 and recommended an average minimum wage of $8.61 per hour.
For businesses who suggested that they would have to lay off employees in the event of aminimum wage increase, $6.50 was their lowest hourly pay and they proposed an averageminimum wage of $7.00 per hour. Businesses who indicated that an increase in the minimum
wage would have little or no effect on their operations, their lowest hourly pay on average was$9.43 an hour and they proposed an average minimum wage of $8.63 per hour.

572024 Minimum Wage Advisory Committee

SECTION 7: MINIMUM WAGE ADJUSTMENT
Option Analysis
No change option
Maintaining the current minimum wage in the Virgin Islands at $6.00 per hour, i.e., a stance of no change,
could potentially safeguard against the risk of unemployment that may disproportionately affect small
businesses sensitive to labour cost fluctuations. Such a conservative approach might be justifiable if theexisting wage is considered sufficient in terms of living costs and overall economic conditions. However,this perspective does not fully consider the substantial increases in the cost of living and economic
conditions since the last review in 2016. Consequently, foregoing a wage adjustment, risks increasing
poverty levels and widening the gap of income inequality among residents, challenging the territory's
long-term social and economic stability.
Given the significant changes in economic conditions and the cost of living over the years, a no-change
policy may fall short of addressing the pressing financial challenges faced by low-income earners. In theface of rising expenses, a stagnant minimum wage will likely strain the workforce, especially those at thelowest income brackets, and may not support the broader aim of equitable economic growth. The
disparity between wage growth and the cost of living will not only impact the standard of living forindividuals but could also affect the larger economic fabric, through reduced consumer spending andincreased reliance on government support programmes. Therefore, carefully reconsidering the minimum
wage is imperative to prevent deepening the economic divide and will promote a more inclusive andthriving economic environment for all citizens.

Minor increase option
A slight increase in the minimum wage in the Virgin Islands could serve as a token of commitment towards
upgrading living standards, carefully balancing the necessity of economic sustenance for businesses with
the imperative of wage growth. Such an incremental approach would likely not impose drastic financial
burdens on employers, particularly small businesses, and could be seen as an equitable solution if thepresent wage is marginally below what is considered an acceptable living wage. However, the effects on
employees' disposable income may be marginal, and the boost to the local economic demand may besimilarly restrained, which could limit the overall economic stimulus expected from raising wages.
Where the cost of living is notably high in the Virgin Islands, even a small increase in the minimum wage
might not be perceived as a substantial improvement by the workforce. There also stands the potential
risk of falling short of making a meaningful difference in the daily lives of employees who are alreadygrappling with expenses that outpace their earnings. The disparity between the elevated cost of living andthe slight wage increment could perpetuate financial struggles, leaving workers to contend with the same
economic pressures as before. Consequently, while a minor wage hike could be an option for
consideration, it may need to be coupled with other measures to genuinely meet the living costs andreflect an earnest effort to bridge the gap between wages and the economic realities of the Virgin Islands.

Moderate Increase
Implementing a moderate increase in the minimum wage within the Virgin Islands could be a pivotal step
toward elevating the living conditions of its lower-income workers. Such a raise would likely provide amuch-needed boost to the purchasing power of these individuals, thereby fostering an increase indomestic consumption that benefits the wider economy. This approach is particularly viable if the58

2024 Minimum Wage Advisory Committeeprevailing wage fails to align with the escalating living expenses and if the economic structure is robust
enough to withstand a rise in labour costs without triggering substantial negative consequences for
employment.
While the advantages of a moderate wage increase are clear, particularly in enhancing the economic wellbeing of workers, the Virgin Islands must remain cognisant of the delicate balance that needs to be
maintained in labour-intensive sectors. Businesses that rely heavily on manual labour could experience asqueeze in their profit margins, which may lead to a re-evaluation of staffing needs or an uptick in productand service pricing to manage increased costs. Careful implementation, alongside supportive measures
for small businesses, could mitigate potential drawbacks, ensuring that the upliftment in wages translates
into broad-based economic benefits, without precipitating unintended adverse effects on the territory's
employment landscape.

Substantial Increase
A significant increase in the minimum wage for the Virgin Islands could serve as a transformative policy
for those at the lower end of the income scale, substantially enhancing their living standards and reducing
income inequality. Given the disparity between the existing wage levels and the high cost of living within
the territory, this approach might be warranted. Such an increase would require an acknowledgement of
the current economic disparities and resolute political and societal backing for what would be a bolddecision.
However, while a substantial increase could be welcomed by lower-paid workers, it carries with it thepotential for considerable economic disruption. Businesses, particularly those operating on narrowmargins, could face increased operational costs, potentially leading to a curtailment of employment
opportunities as they strive to maintain financial viability and the adjustment of other employees' salaries.
Moreover, such a wage hike could introduce inflationary pressures into the economy, with the increased
spending power leading to higher demand and subsequent price rises. In the Virgin Islands, where small
businesses form the economic backbone, and resilience to inflation is limited, the repercussions of asignificant minimum wage rise, particularly in the short term, demand a thoughtful, measured approachto ensure that the pursuit of social equity does not inadvertently compromise economic stability.

592024 Minimum Wage Advisory Committee

Calculation Options
The following highlights the options available to the Government of the Virgin Islands for consideration,
which factors in the results from the surveys conducted and the research available. Whilst the options areprovided for each scenario, it is important to note that depending on the option considered/selected, it
remains the responsibility of the government to separately, find ways to combat the issues highlighted by
the employers related to price increases to their products and services, and possible layoffs of employees,
should an increase in the minimum wage occur.

Option 1
Adjusting by Scientific Method
1. Calculate Basic Living Wage•

Hours per Month: Assuming full-time work, 160 hours/month•Calculation: Basic Living Wage = Monthly Living Expenses/Hours per Month•

Result: Basic Living Wage = $2680.45/160 = $16.75/hour

2. Set Proposed Minimum Wage Relative to Median Wage•Median Hourly Wage: $16.75•

Percentage of Median: 60%1•

Calculation: Proposed Minimum Wage = Median Hourly Wage × Percentage of Median•Result: Proposed Minimum Wage = $16.75×0.60 = $10.00/hour

3. Adjustments for Economic Factors•

Initial Proposal: $10.00/hour•

Adjustment (considering feedback): Increase or decrease by $0.00•

Adjusted Wage: $10.00 + $0.00 = $10.00/hour

4. Phasing and Implementation•

Year 1: $8.00•

Year 2: $9:00 (Incremental increase)•

Year 3: $10.00 (Final target wage)

1

The 60% threshold aligns with recommendations and practices observed internationally, like the International
Labour Organization (ILO) who encourages setting the minimum wage between 35% and 60% of the median wage.

60

2024 Minimum Wage Advisory Committee

Option 2
Adjusting by Inflation only
Current Rate
Inflation
Adjusted
Minimum Wage

2016
$6.00

2017

2018

2019

2020

2021

2022

2023

2024

1.2%
$6.07

2.1%
$6.14

1.4%
$6.27

0.4%
$6.36

2.8%
$6.38

4.0%
$6.56

3.5%
$6.82

2.5%
$7.06

Option 3
Adjusting by Employees' recommendation
Average, Minimum and Maximum Hourly Pay, Hours Worked and Proposed Minimum Wage

Mean (Average)
Minimum
Maximum
Number of Employees

Hourly rate of
pay
18.47
4.00
630.00496

Hourly Pay
Rate Without
Outliers
16.10
4.00
87.00
492

Average
Proposed
number ofWhat should
Minimum
hours worked
minimum
Wage Without
per week
wage beOutliers
39.75
11.60
11.09
4.00
6.00
6.00
86.67
80.00
20.00
589
611
593

Adjusting by Employers’ recommendation
Average, Minimum and Maximum Proposed Minimum Wage

Mean (Average)
Minimum
Maximum
Number of Employers

What is the lowest hourly wage
you pay in your business?
8.43
5.50
20.00
52

What do you think the minimum
wage should be?
8.46
7.00
12.00
28

61

2024 Minimum Wage Advisory Committee

Final Adjusted Minimum Wage
The recommended adjusted minimum wage stands at $9.00 per hour.
The comprehensive analysis of the impact of minimum wage increases in the Virgin Islands and detailed
wage data from local businesses underscores the need for a thoughtful adjustment to the minimum wage
rate. The prevailing average lowest hourly wage paid by businesses stands at $8.43, with stakeholders
proposing an average minimum wage of $8.46, reflecting a consensus around these figures.
However, considering the broader economic impacts, including concerns over increased operationalcosts, potential business closures, and competitive disadvantages, a moderate increase to $9.00 per hour
seems reasonable based on the average suggested wage by employers. This rate aligns closer with thecurrent economic reality, and offers a balance to the average employee's suggestion of $11.09.

622024 Minimum Wage Advisory Committee

SECTION 8: IMPACTS OF MINIMUM WAGE
Economic Impact
Sector-Specific Impacts of Minimum Wage Adjustments
In the Virgin Islands, adjustments to the minimum wage can have diverse impacts across different
economic sectors, primarily due to the varied nature of these sectors and their distinct economic
dynamics. The tourism sector, a cornerstone of the Virgin Islands economy, is susceptible to minimum
wage adjustments. This sector relies heavily on a flexible labour force to accommodate seasonal
fluctuations in tourist arrivals. As suggested by many, increasing the minimum wage could lead to higher
operational costs for businesses within this sector, such as hotels, restaurants, tour operators, and otherservice areas. While these adjustments aim to improve living standards for workers, they also necessitatechanges in business models, such as increases in service prices or investments in automation, to maintainprofitability. The challenge lies in implementing wage adjustments that support workers' well-being
without adversely affecting the sector's competitiveness, especially in the highly competitive Caribbean
tourism market.
The impact of minimum wage adjustments may be less pronounced in the financial services sector, which
also plays a pivotal role in the Virgin Islands' economy. This sector generally offers higher wages due tothe specialised skills and qualifications required, meaning a significant portion of its workforce alreadyearns above the minimum wage threshold. However, indirect effects may still be observed, particularly insupport roles more closely aligned with minimum wage levels. Adjusting the minimum wage could
increase operational costs, though these are likely a smaller proportion of overall expenses than in the
tourism sector. The primary consideration for the financial services sector is maintaining an attractive
business environment and a skilled workforce, with wage policies playing a role in ensuring the industry
remains competitive on a global scale by attracting and retaining talent.
In the construction sector, which is crucial for the Virgin Islands' development and recovery efforts,
especially following natural disasters, an increase in the minimum wage could potentially elevate the costof construction projects. This sector relies on a mix of skilled and unskilled labour. While wage increases
might improve living standards for workers, they could also result in higher operational costs forconstruction firms. These firms may need to adjust their bidding on projects or increase their reliance ontechnological solutions to maintain margins. However, the positive side is that higher wages can attract amore skilled workforce and reduce turnover, potentially increasing productivity and quality inconstruction projects and contributing to the territory's infrastructural resilience.
The agriculture sector, though smaller and less prominent than tourism or financial services, is significant
for local food security and the diversification of the economy. Wage adjustments in this sector could
directly impact the cost of local produce, making agriculture more labour-cost intensive relative toimported goods. This adjustment could either incentivise or discourage local production, depending on
the balance between wage increases and productivity gains. For local farmers, higher wages must be
matched with increased efficiency and output to sustain profitability. Moreover, enhancing the minimum
wage could help revitalise the sector by attracting younger workers and contributing to the sustainabilityof local agriculture.
Addressing these sector-specific impacts requires a careful and balanced approach to ensure minimum
wage policies support the Virgin Islands' broader economic and social goals, without disadvantaging
critical sectors like tourism, construction and agriculture.

632024 Minimum Wage Advisory Committee

Social Impact
Impact on Living Standards and Social Welfare
In the Virgin Islands, the impact of wage policies, including the minimum wage, on living standards andsocial welfare is profound, given the territory's high cost of living and economic reliance on sectors withwide wage disparities. A 2022 review of Social Assistance in the Virgin Islands by the Society Policy
Research Institute (SPRI Global) suggests the constraints of the current minimum wage. SPRI Global
further indicated that any adjustment to the current minimum wage must be carefully analysed toconsider any potential impacts of economic constraints. Understanding these findings and implementing
a well-defined minimum wage policy is instrumental in ensuring that workers, particularly those in lowerwage industries such as tourism, construction and retail, can afford necessities.
Where the cost of goods and services is significantly influenced by importation costs, a well-structured
minimum wage helps mitigate the risk of poverty among the working population, and ensures a more
equitable distribution of economic gains. By elevating the earnings of the lowest-paid workers, the policy
directly enhances their living standards, allowing for better access to housing, healthcare, and education,
which are crucial components of social welfare.
Moreover, an adequate minimum wage can foster a sense of dignity and stability among workers beyond
the immediate financial benefits. It can improve health outcomes by reducing stress and anxiety
associated with financial insecurity and enabling access to better healthcare services and healthierlifestyle choices. In the Virgin Islands, where community cohesion and well-being are vital to the social
fabric, the positive impact of increased wages on workers' morale and their sense of inclusion in the
territory's economic success cannot be overstated. This, in turn, can contribute to a more harmonious
society, with reduced social tensions and a stronger collective identity.
Additionally, the ripple effects of an improved minimum wage on the Virgin Islands' economy should not
be underestimated. There is the notion that higher wages can lead to increased consumer spending, which
stimulates local businesses and can drive economic growth. This cycle of earning and spending within theeconomy can help create an opportunity for a more resilient economic environment that is less vulnerable
to external shocks. For small island economies like the Virgin Islands, which face challenges such as
vulnerability to natural disasters and global economic fluctuations, fostering a strong internal market isessential for long-term social and economic stability.
However, the pursuit of improved living standards and social welfare through wage adjustments must be
carefully managed. Policymakers in the Virgin Islands must consider the potential impacts on employment
and the competitiveness of local businesses, particularly in labour-intensive sectors. Balancing thebenefits of wage increases with the need to maintain a healthy business environment and attract
investment requires informed policy decisions. It involves ongoing dialogue with stakeholders, including
employers, workers, and community leaders, to ensure that wage policies are sustainable and alignedwith the broader goals of economic development and social cohesion. Through such a balanced approach,the Virgin Islands can leverage wage policy to improve individual living standards and enhance theterritory's overall social welfare.

642024 Minimum Wage Advisory Committee

SECTION 9: RISK
While implementing an adjusted minimum wage for the Virgin Islands will bring benefits, there are risks
associated with adjusting that must be considered. Identifying these risk factors would allow stakeholders
to develop mitigating strategies to balance their impacts and create a roadmap for implementation.

Employment Impact
In the Virgin Islands, the prospect of raising labour costs through an increased minimum wage, raises
legitimate concerns about the potential impact on employment levels. Businesses, particularly SMEs
which represent a substantial segment of the Virgin Islands’ economic landscape, may need to adjust tothese changes by scaling back their workforce, postponing new hires, or seeking efficiency gains throughautomation. Such adjustments could be more pronounced in sectors like tourism and retail services, which
typically operate on thinner profit margins and are more labour-dependent. Any policy shifts in wage
structures must be navigated with caution to avoid unintended consequences on job availability.
The delicate balance of supporting workers' welfare while ensuring business sustainability, is especiallychallenging for small economies such as the Virgin Islands, where each job forms a critical component of
the broader economic fabric. The potential reduction in employment opportunities due to increased wage
bills might not only undermine the intended benefits of wage increases for individual workers but could
also ripple through the community, affecting dependent sectors and overall economic health. Therefore,
any minimum wage adjustments must include considerations of mitigating strategies to support SMEs andlabour-intensive sectors, ensuring that efforts to improve living standards do not inadvertently lead to acontraction of the very employment opportunities that sustain those standards.

Increased Costs for Consumers
In the economy of the Virgin Islands, where the importation of goods is commonplace due to local
production constraints, businesses grappling with elevated labour costs might have little choice but topass these on to consumers. This transfer can manifest in the form of higher prices for goods and services
across the board, potentially triggering inflationary trends within the territory. The resultant price hikes
can dilute the purchasing power that a higher minimum wage intends to provide, thus diminishing theoverall economic benefit for the workers, and potentially leading to a cost-push inflation scenario, where
the cost of living climbs in tandem with the minimum wage.
The risk of such inflationary pressures is particularly acute in a small, import-reliant economy like that of
the Virgin Islands, where there is less elasticity in the supply of goods and services to absorb cost increases
without affecting prices. While the policy of raising the minimum wage aims to elevate the standard ofliving for low-income earners, the ensuing increase in prices may reduce the real income gains for all
consumers, including those it seeks to assist. In essence, the extra income workers receive could be
consumed by the increased costs for basic living necessities, prompting a re-evaluation of the extent towhich a minimum wage hike can effectively empower the Virgin Islands' unique economic landscape.

Competitiveness Concerns
The tourism and financial services industries stand as the twin pillars of the local economy, both attracting
global interest. Introducing a significant hike in labour costs poses a risk to the Virgin Islands’ competitiveedge in these sectors. In tourism, a notable increase in operational costs could lead to higher prices foraccommodations and services, potentially making the Virgin Islands a less attractive destination comparedto other regions where the costs for tourists remain lower. This shift could result in a downturn in tourist
numbers, thereby affecting one of the territory's most crucial revenue streams.
652024 Minimum Wage Advisory Committee

Similarly, the financial services industry, which hinges on the Virgin Islands’ reputation for fiscal efficiency
and attractiveness to international businesses, may be disadvantaged if labour expenses surge.
Companies might reconsider the territory as a cost-effective jurisdiction, which could lead to a relocationof businesses to more economically favourable climates. Such a movement would not only undermine thecurrent standing of the territory within the global financial arena but could also have broader economic
ramifications, affecting employment and the ancillary services that support this sector. Thus, any labour
cost increases need careful calibration to preserve the delicate balance between fair employment
practices and the Virgin Islands’ appeal to tourists and global investors.

Informal Economy Growth
An increase in the minimum wage could inadvertently foster the expansion of the informal economy. Thisis particularly likely in sectors where monitoring and enforcement of wage regulations are challenging.
Employers facing heightened financial pressures from elevated wage mandates might opt to sidestep
these regulations by hiring workers off the books at rates below the mandated minimum. Such practices
undermine the intent of the wage increase and place workers in precarious positions devoid of the legal
protections and benefits that formal employment typically ensures.
The growth of this informal sector can have multiple adverse effects on the local economy. Workers
employed under these conditions don’t receive critical social protections such as health insurance andpension contributions. Additionally, the government loses potential tax revenue, which is crucial for
funding public services and infrastructure that support economic development. This shift toward informal
employment could diminish the overall quality of jobs and weaken the labour market's structure,countering the benefits intended by raising the minimum wage.

Adjustment Period for Businesses
Small businesses in the Virgin Islands, which are crucial to the local economy, might find adjusting to anincreased minimum wage particularly challenging. These enterprises often operate with tighter budgets
and less financial flexibility compared to larger companies, making sudden increases in labour costs a
significant burden. As a result, small business owners might need to reassess their operations strategically.
This could involve modifying business models, such as increasing prices for goods and services or finding
areas where operational costs can be trimmed. Such changes, while necessary to accommodate higher
wages, could lead to a period of financial instability as businesses adjust to the new economic
environment.
This transitional phase could temporarily destabilise not just the businesses themselves but also thebroader economic activity in the territory. For instance, price increases to offset higher labour costs might
reduce consumer spending, particularly if wages in other sectors or disposable incomes do notconcurrently rise. Similarly, cost-cutting measures could dampen economic growth, such as reducing staff
hours or delaying investments in business improvements. These adjustments, necessary for survival in the
short term, might inhibit the overall vibrancy and competitive edge of the small business sector, which isa vital component of the territory's economic fabric.

66

2024 Minimum Wage Advisory Committee

SECTION 10: APPLICATION
Technological and Innovation Considerations
In the Virgin Islands, the impact of automation and technology on labour demand and wage structures is
becoming increasingly significant, echoing global trends. The pillars of the Virgin Islands’ economy areexperiencing shifts due to technological advancements. In tourism, automation and digital platforms
transform service delivery and customer interaction, potentially reducing the demand for traditional,
labour-intensive roles but creating new opportunities in digital marketing and data analysis. This shift
requires re-evaluating wage structures as the demand increases for skills associated with digitalcompetencies and customer experience management. As such, there's a growing need for the workforce
to adapt to these changes, with implications for training, education, and wage policies to ensure that
employees are equipped for the jobs of tomorrow.
Unlike the Tourism Industry, the impact of technology and automation is profound in the financial services
sector, with fintech innovations revolutionising how services are delivered and consumed. Blockchain,
artificial intelligence, and automated processes are making operations more efficient and reshaping thelabour demand. High-skilled professionals adept in these technologies are in greater demand, potentiallycommanding higher wages, while roles focused on routine tasks may see reduced demand. This evolution
could lead to a more polarised wage structure in the sector, highlighting the importance of upskilling andreskilling initiatives. For the Virgin Islands, investing in education and training programmes that align withthese emerging technological trends is crucial to maintaining the competitiveness of its financial services
sector and ensuring that its workforce is abreast of the global digital economy.
The broader implications of automation and technology on the Virgin Islands' labour market and wage
structures underscore the need for comprehensive policy responses. These should include fostering abusiness environment that encourages innovation and technological adoption, while supporting
workforce development to mitigate potential dislocations. Policies aimed at enhancing digital literacy andtechnical skills across the population can ensure that the benefits of technological advancements arebroadly shared. Moreover, adapting wage structures to reflect the value of technological competencies
and encouraging lifelong learning are essential in preparing the Virgin Islands’ workforce for a future
where technology and automation play a central role. By addressing these challenges proactively, theVirgin Islands can harness the potential of technology to drive economic growth and improve living
standards while ensuring that its labour market remains resilient and inclusive, and workers areadequately compensated.

Opportunities for Innovation in Monitoring and Enforcing Minimum Wage ComplianceIn the Virgin Islands, ensuring compliance with minimum wage regulations presents challenges due to theterritory's diverse economy, primarily tourism, financial services, and small-scale agriculture. However,these challenges also offer opportunities for innovation for monitoring and enforcing minimum wage
compliance, leveraging technology and strategic partnerships to create a more effective regulatory
framework.
One innovative approach could involve developing and implementing digital platforms for wage reportingand monitoring. By requiring employers to submit payroll data electronically, the Government of theVirgin Islands could utilise data analytics to identify discrepancies and potential non-compliance issues inreal-time. Such a system could be designed to flag anomalies automatically, such as payments below theminimum wage or irregular payment patterns, facilitating targeted audits and investigations. This67

2024 Minimum Wage Advisory Committee

approach not only enhances the efficiency of compliance checks but also acts as a deterrent to potential
violators, knowing their payroll practices are under scrutiny.
Additionally, the Virgin Islands could explore using mobile applications to empower workers, enablingthem to report violations anonymously. These applications could provide workers with information on
their rights, calculators to verify their wages against hours worked, and direct lines to report noncompliance. By putting power into workers' hands, the government can tap into a valuable source of onthe-ground information, making enforcement more dynamic and responsive to workers' real-time
experiences. This strategy also promotes a culture of compliance among employers by increasingtransparency and accountability in wage practices.
Lastly, the partnerships with local and international organisations could further augment the Virgin
Islands’ efforts to monitor and enforce minimum wage compliance. Collaborating with labour unions,business associations, and international bodies like the International Labour Organization (ILO) can
provide access to expertise, resources, and best practices in labour standards enforcement. These
partnerships can support capacity building for local enforcement agencies, offer platforms for stakeholder
engagement and dialogue, and help integrate Virgin Islands' compliance mechanisms with global labour
standards. Through these collaborative efforts, the Virgin Islands can strengthen its regulatory framework,
ensuring that minimum wage policies are effectively enforced and contribute to the broader goal ofpromoting fair labour practices and protecting workers' rights in the territory.

682024 Minimum Wage Advisory Committee

SECTION 11: RECOMMENDATIONS AND CONCLUSION
Recommendations
The identification of an adjusted minimum wage comes with challenges on the employee’s side as well as
the employer’s side. Finding the right balance that supports workers’ well-being without adversely
affecting the profit margins of businesses and overall economic advancement calls for careful selection
and implementation. In crafting the options analysis, it’s important to consider the unique economic andsocial landscape of the Virgin Islands, including its reliance on tourism and financial services, room fordiversification, the size of its economy, and its vulnerability to external economic shocks. Each option
should be evaluated not just in terms of immediate economic impacts but also long-term sustainability
and social objectives.
While minimum wage adjustments in the Virgin Islands can improve workers' ability to afford basic
necessities, careful consideration is needed to balance these benefits with the potential for inflationarypressures. A strategic approach that considers the diverse impacts across sectors and the broader
economic context is essential for ensuring that wage adjustments contribute positively to the overall
economic health and well-being of the Virgin Islands.
The adjustment of the minimum wage in the Virgin Islands could have significant implications acrossvarious sectors. A collaborative approach involving employees, employers, and the Government isessential to mitigating potential risks that could come from implementing a wage that is not correctly
timed or structured.
Employees should seek opportunities for training and upskilling to remain competitive in a job market
that may favour higher-skilled workers due to wage increases. Participating in certification programmes
or further education can help secure their positions or qualify them for higher-paying roles.
Workers should improve their financial literacy to manage increased incomes better and navigate periodsof economic adjustment. This could involve learning budgeting techniques, saving strategies, andunderstanding financial products that can help safeguard against economic instability.
Employees ought to engage actively in dialogues with employers and government bodies about wage
adjustments to ensure their voices and concerns are heard, promoting policies that directly address theirneeds.
Employers, especially small business owners, should consider revising their business models to adapt tohigher labour costs. This might include investing in technology to improve efficiency, revising service
offerings, or exploring new markets to expand their customer base.
Additionally, it's crucial for employers to maintain open lines of communication with their employees
regarding how wage changes will affect the business and the potential measures to be implemented. Thistransparency can help manage expectations and foster a cooperative environment for navigating changes.
Businesses should perform some level of financial planning to assess the impact of wage increases on theiroperations and explore strategies for cost management that do not involve layoffs or significant cutbacks
in employee benefits.

The Government should consider introducing measures and support structures specifically designed toaid small businesses in coping with increased wage expenses. This support can be crucial in preventing
business closures and ensuring that small enterprises continue to thrive.
69

2024 Minimum Wage Advisory Committee

The Government should align the minimum wage with economic realities continuously, by committing toregular and thorough economic assessments. These assessments can help determine when adjustments
to the minimum wage are necessary and ensure that changes are both timely and reflective of current
economic conditions.
The Government should also invest in public education programmes about the benefits and challenges ofwage adjustments. This includes providing resources and training to help employers and employees
understand and adapt to changes. Additionally, strengthening labour enforcement mechanisms to ensurecompliance with wage regulations is critical for protecting worker rights.
Ultimately, in considering minimum wage adjustments, the Virgin Islands must take into account its
economic vulnerability and the potential timing of such changes. It's crucial to align wage policy decisions
with a broader economic strategy that includes building resilience against external shocks. This approach
may involve establishing contingency plans, such as a staggered wage increase aligned with economic
recovery indicators, or creating buffers and support mechanisms for sectors most vulnerable to external
fluctuations. By carefully timing and structuring minimum wage adjustments, the Virgin Islands can better
ensure that these changes bolster, rather than undermine, the overall economic stability andsustainability of the territory.
Hence, any discussions around minimum wage adjustments must include considerations of mitigating
strategies to support SMEs and labour-intensive sectors, ensuring that efforts to improve living standards
do not inadvertently lead to a contraction of the very employment opportunities that sustain thosestandards.
Lastly, conducting another review of the minimum wage in the next five years is important for the Virgin
Islands to ensure that wages keep pace with evolving economic conditions and cost of living changes.
Regular reassessment will allow for timely adjustments in response to inflation, shifts in the global
economy, and local market dynamics, ensuring that the minimum wage remains effective in providing adecent standard of living for workers. This proactive approach also helps in mitigating potential adverse
impacts on employment and competitiveness, enabling the government and businesses to plan and adapt
more effectively.

702024 Minimum Wage Advisory Committee

Conclusion
The comprehensive review of the minimum wage in the Virgin Islands underscores the urgent need for an
adjustment to address the disparity between the current wage levels and the rising cost of living. The
analysis revealed that the existing minimum wage is insufficient, particularly given the economic relianceon sectors like tourism and financial services, which are vulnerable to global economic shifts. This
inadequacy is felt acutely by low-income workers who struggle to meet basic needs, highlighting a clear
disconnect between wage growth and living costs. Our recommendation for a moderate increase in theminimum wage is rooted in a balanced approach that seeks to improve living standards for workers while
maintaining the economic viability of businesses across the islands.
This recommended increase reflects a consensus from extensive stakeholder consultations and detailedsocio-economic analyses. It represents a strategic approach designed to provide significant relief toworkers without imposing undue strain on employers, particularly small and medium-sized enterprisesthat form the backbone of the local economy. By adopting this path, it is anticipated that the Virgin Islands
can expect to see an uplift in worker morale and productivity, which in turn can stimulate local
consumption and economic activity, contributing to a more robust economic cycle.
In conclusion, implementing the proposed increase in the minimum wage of $9.00 an hour is a pivotal
step towards fostering a more equitable economic environment in the Virgin Islands. It balances theimmediate needs of the workforce with the long-term sustainability of the territory’s economic
framework. Moving forward, it will be crucial to closely monitor the economic impacts of this policy shift
and maintain an open dialogue with all economic stakeholders to ensure that the minimum wage remains
responsive to both economic conditions and the population's needs. This ongoing evaluation andadjustment will be key to ensuring that the Virgin Islands continues to grow as a competitive and fair place
to live and work.

712024 Minimum Wage Advisory Committee

SECTION 12: REFERENCE
Document References••••

2022-2024 Macro Economic Review and Outlook
Medium-Term Fiscal Plan 2024-2026
National Sustainable Development Plan
Social Assistance in the British Virgin Islands, A review of and options for reforming the Social
Assistance Benefits and Grand Administration Systems

Website References
Bermuda•A Guide to the Minimum Hourly Wage Rate.
Government of Bermuda.
https://www.gov.bm/sites/default/files/A%20Guide%20to%20the%20Minimum%20Hourly%20
Wage%20Rate.pdf

Bahamas•••Bahamas – Labour. https://www.privacyshield.gov/ps/article?id=Bahamas-LabourNew
minimum
wage
revealed.
The
NassauGuardian,
Bahamas.
https://www.thenassauguardian.com/home/new-minimum-wage-revealed/article_a7666164543b-5f73-bdc8-6974a58ff88f.html
https://apnews.com/article/inflation-caribbean-minimum-wage-business-puerto-rico2b665e74a74826e11e206e3d73251f4b

Cayman Islands••••

Minimum Wage Report. Cayman Islands Government. https://www.gov.ky/publicationdetail/minimum-wage-reporthttps://caymannewsservice.com/2024/03/data-suggests-cayman-can-sustain-10-minimumwage/#:~:text=(CNS)%3A%20Pressure%20from%20the,and%20Statistics%20Office%20indicated%20thathttps://www.caymancompass.com/2024/03/04/new-minimum-wage-of-8-75-an-hourproposed-for-cayman/
https://www.caymancompass.com/2024/04/12/caymans-minimum-wage-one-of-the-leastgenerous-in-the-world/

Turks and Caicos Islands
•
•
•

TCI
Minimum
Wage
Increasestartswith
Gov’t
BudgetYear.
https://magneticmediatv.com/2023/04/tci-minimum-wage-increase-starts-with-govt-budgetyear/
National Minimum Wage Increase came into effect April 1st, 2023. https://suntci.com/nationalminimum-wage-increase-came-into-effect-april-st-p9031-129.htm
Minimum Wage Increase to $8 per hour. https://suntci.com/minimum-wage-increased-to-perhour-p8704-129.htm

722024 Minimum Wage Advisory Committee

Anguilla•

Establishingaminimumwage–
Isapromised
being
Realized.
https://theanguillian.com/2023/07/establishing-a-minimum-wage-is-a-promise-being-realised/

Barbados•

Report of the Blue-Ribbon Advisory Committee on the establishment of a national minimum
wage. https://labour.gov.bb/wp-content/uploads/2021/03/Report-of-the-Blue-Ribbon-AdvisoryCommittee-on-Minimum-Wage-cfv-converted.pdf

2024 Latin America and Caribbean Macroeconomic Report: Ready for Take0Off? Building on
Macroeconomic Stability for Growth. https://publications.iadb.org/en/2024-latin-american-andcaribbean-macroeconomic-report-ready-take-building-macroeconomic-stability
Economic
Review|
Latin
AmericaandtheCaribbean
April
2024.
https://www.worldbank.org/en/region/lac/publication/perspectivas-economicas-america-latina-caribe

Growth, Disparities and Inclusive Development in India: Perspectives from the Indian State of Uttar [1sted.] 978-981-13-6442-6;978-981-13-6443-3 - DOKUMEN.PUB. https://dokumen.pub/growth-disparitiesand-inclusive-development-in-india-perspectives-from-the-indian-state-of-uttar-pradesh-1st-ed-978981-13-6442-6978-981-13-6443-3.html

Howson, Kelle, et al. "Fairwork South Africa Ratings 2020:Labour Standards in the Gig Economy." 2020,
https://core.ac.uk/download/533462712.pdf.
International Labour Organization. https://www.ilo.org/global/lang--en/index.htm
International Labour Organization. https://www.ilo.org/resource/55-ratio-minimum-average-wages
The Retirement Café: August 2017. http://www.theretirementcafe.com/2017/08/

732024 Minimum Wage Advisory Committee

SECTION 13: APPENDICES
Appendix 1: Term of Reference742024 Minimum Wage Advisory Committee75

2024 Minimum Wage Advisory Committee762024 Minimum Wage Advisory Committee772024 Minimum Wage Advisory Committee

Appendix 2: Minimum Wage Committee Questionnaire Employer
The Ministry of Financial Services, Labour and Trade invites you to participate in this short questionnaire
where your views will assist us in gathering useful insights into determining a reasonable minimum hourlybase pay in the Territory. This is a unique opportunity for you to contribute to a decision that directly
affects the economy of the British Virgin Islands. Your responses will be confidential and instrumental in
guiding our approach to a base strategy. We look forward to your participation and thank you in advancefor helping us develop a minimum wage that is fair and acceptable to all
1.
2.
3.
4.

5.
6.
7.
8.

Type of Business
Island of Operation
Number of employees
How many employees do you have earning:a. Below a $6 per hour rate?
b. At $6 per hour rate?
c. Above $6 per hour rate?
What is the lowest hourly wage you pay in your business?
Do you believe the current minimum wage is sufficient for employees to live on?
What do you think the minimum wage should be?
What would be the impact on your business if the minimum wage increased?

782024 Minimum Wage Advisory Committee

Appendix 3: Minimum Wage Committee Questionnaire Employee
The Ministry of Financial Services, Labour and Trade invites you to participate in this short questionnaire
where your views will assist us in gathering useful insights into determining a reasonable minimum hourlybase pay in the Territory. This is a unique opportunity for you to contribute to a decision that directly
affects the economy of the British Virgin Islands. Your responses will be confidential and instrumental in
guiding our approach to a base strategy. We look forward to your participation and thank you in advancefor helping us develop a minimum wage that is fair and acceptable to all.
1.
2.
3.
4.

Age group
Sex
Place of Birth
Number of persons in your householda. Number of adults (65 years and above)b. Number of adults (18 years to 64 years)c. Number of children (17 years and under)
5. What is your highest level of education achieved?
6. Island of Employment
7. Immigration Status
8. Occupation
9. Employment Status
10. What type of business do you work in? (e.g. Taxi, store, hotel)
11. What is your hourly rate of pay?
12. Average number of hours worked per week?
13. Do you receive any government assistance? (i.e. public assistance)
14. Do you have any source of income?
15. Do you believe that the minimum wage should be raised?
16. What do you think the minimum wage should be?

792024 Minimum Wage Advisory Committee

Appendix 4: Living Wage Basket
Expenditure
Level
HouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHousehold
Men
Men
Men
Men
Men
Men
Men
Boy
Boy
Women
Women
Women
Women
Women
Women
Women
Girl
Girl
Girl
Girl
Girl
Women
Men
Men
Men
Women
Women
Boy or GirlBoy or GirlHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHousehold
AdultsAdultsAdultsHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdHouseholdBoy or GirlBoy or GirlBoy or GirlAll Persons
All Persons
Women
Men
All Persons
All Persons
All Persons
Women
Toddlers
AdultsAdultsAdultsAdultsAdultsHousehold

Item Description
Expenditure Level - Item Description
White rice
Household - White rice
White FlourHousehold - White FlourWhite Bread (Slice)
Household - White Bread (Slice)
Macaroni
Household - Macaroni
Corn Flakes
Household - Corn Flakes
Stew Beef/RoundHousehold - Stew Beef/RoundCorned Beef
Household - Corned Beef
Chicken Wings
Household - Chicken Wings
KingfishHousehold - Kingfish
Pasteurized Milk/Box Milk
Household - Pasteurized Milk/Box Milk
Imported Eggs
Household - Imported Eggs
Processed Sliced Cheese
Household - Processed Sliced Cheese
ButterHousehold - Butter
Vegetable Oil
Household - Vegetable Oil
OrangesHousehold - Oranges
Ripe Bananas
Household - Ripe Bananas
Red Apple
Household - Red Apple
TomatoesHousehold - Tomatoes
Carrots
Household - Carrots
Sweet Pepper -Green
Household - Sweet Pepper -Green
Onion
Household - Onion
Peas (Can)Household - Peas (Can)Corn (Can)Household - Corn (Can)Red Kidney Beans (Can)Household - Red Kidney Beans (Can)
Sweet Potato
Household - Sweet Potato
Irish Potato/Regular Brown Potato Household - Irish Potato/Regular Brown Potato
Refined White Sugar
Household - Refined White Sugar
Peanut Butter
Household - Peanut Butter
Salt
Household - Salt
Tomato Ketchup
Household - Tomato Ketchup
Mayonnaise
Household - Mayonnaise
Small Bottle Water
Household - Small Bottle Water
Orange JuiceHousehold - Orange Juice
Fruit Punch
Household - Fruit Punch
WineHousehold - Wine
Beer
Men - Beer
Men's Long Trousers/ Dress Pants
Men - Men's Long Trousers/ Dress Pants
Men's Long Trousers /Casual and jeans
Men - Men's Long Trousers /Casual and jeans
Men's Long sleeve dress shirts
Men - Men's Long sleeve dress shirts
Men's short sleeve shirts(work or casual)
Men - Men's short sleeve shirts(work or casual)
Men's T-Shirts
Men - Men's T-Shirts
Men's Underwear
Men - Men's Underwear
School Pants
Boy - School Pants
Boy's Casual Shirts
Boy - Boy's Casual Shirts
Women's Dresses (evening/formal) Women - Women's Dresses (evening/formal)
Women's dress shirts/ blouse
Women - Women's dress shirts/ blouse
Women's Casual shirt/blouse
Women - Women's Casual shirt/blouse
Women's Long skirts
Women - Women's Long skirts
Women's long jean pants
Women - Women's long jean pants
Bras
Women - Bras
Panties
Women - Panties
Girl's dresses (evening/formal)
Girl - Girl's dresses (evening/formal)
Girl's Jeanpants(long or short)Girl - Girl's Jeanpants(long or short)Girl's Bra
Girl - Girl's Bra
Girl's Panties
Girl - Girl's Panties
Girl's School blouses/shirts
Girl - Girl's School blouses/shirts
Bags
Women - Bags
Men's Dress Shoes
Men - Men's Dress Shoes
Men's Casual Shoes
Men - Men's Casual Shoes
Men's Sneakers
Men - Men's Sneakers
Women's Dress Shoes
Women - Women's Dress Shoes
Women's Casual Shoes
Women - Women's Casual Shoes
Children's School shoes
Boy or Girl - Children's School shoesChildren's Dress Shoes
Boy or Girl - Children's Dress Shoes
Apartment
Household - Apartment
Land TaxHousehold - Land Tax
Public Water Supply
Household - Public Water Supply
Electricity
Household - Electricity
Gas- Propane Cylinders
Household - Gas- Propane Cylinders
Sofa/Living Room Sets
Household - Sofa/Living Room Sets
TV Stand/Entertainment Center
Household - TV Stand/Entertainment Center
Dinette Set (5 or 7 piece)
Household - Dinette Set (5 or 7 piece)
King/Queen Size Bed
Household - King/Queen Size Bed
Mattress
Household - Mattress
Drapes and Curtains
Household - Drapes and Curtains
Sheet Sets
Household - Sheet Sets
Cooking Stove
Household - Cooking Stove
Refridgerator
Household - Refridgerator
Washing MachineHousehold - Washing MachineElectric Iron
Household - Electric Iron
Electric FanHousehold - Electric Fan
Plates, Teacups, saucers, mugs, bowlsHousehold - Plates, Teacups, saucers, mugs, bowls
Forks, spoons, knives
Household - Forks, spoons, knives
Dish Washing Liquid
Household - Dish Washing Liquid
Washing Detergent
Household - Washing Detergent
Bleaches
Household - Bleaches
Fabric Softeners
Household - Fabric Softeners
Aluminum Foil
Household - Aluminum Foil
Vitamins
Household - Vitamins
Cough/Flu Medicine
Household - Cough/Flu Medicine
Pain Relievers
Household - Pain Relievers
Adults - Consultation of General Physician
Consultation of General Physician
Adults - Consultation of Dentist
Consultation of Dentist
Adults - Public Hospital Care
Public Hospital Care
Motor Cars
Household - Motor Cars
Tires
Household - Tires
Car BatteriesHousehold - Car Batteries
Unleaded Gasoline
Household - Unleaded Gasoline
Oil
Household - Oil
Household - Driver's License
Driver's License
Licensing of Vehicles
Household - Licensing of Vehicles
Vehicle Insurance
Household - Vehicle Insurance
Household - Cellphones
Cellphones
Cable
Household - Cable
Cellphone Service
Household - Cellphone Service
Home Internet
Household - Home Internet
Television Sets
Household - Television Sets
Household - Personal Computers
Personal Computers
Household - Movie Cinema
Movie Cinema
Text Books
Boy or Girl - Text Books
Dictionaries
Boy or Girl - Dictionaries
Exercise Books
Boy or Girl - Exercise Books
All Persons - Fried Chicken and FriesFried Chicken and FriesAll Persons - Chicken
ChickenHair Dressing -Perms, shampoo
Women - Hair Dressing -Perms, shampoo
Men's Haircut
Men - Men's Haircut
All Persons - Combs, toothbrush, scissors
Combs, toothbrush, scissors
All Persons - Toilet Soap, toothpaste
Toilet Soap, toothpaste
All Persons - Deodorant, lotions
Deodorant, lotions
Sanitary Napkins/Pads
Women - Sanitary Napkins/Pads
Baby Pampers
Toddlers - Baby Pampers
Adults - Perfumes and colognes
Perfumes and colognes
Adults - Watches
Watches
Adults - Suitcases and Travel Bags
Suitcases and Travel Bags
Adults - Life InsuranceLife Insurance
Adults - Private Health Insurance
Private Health Insurance
Vehicle Insurance
Household - Vehicle Insurance

Avg Jan Base Price Apr 2022
7.55
6.87
6.16
6.12
3.02
3.05
1.77
1.66
6.06
6.00
5.75
6.94
3.82
3.78
14.93
18.72
5.14
6.20
2.33
2.49
2.45
3.25
3.67
4.73
3.30
4.16
7.62
5.93
0.48
0.58
0.97
1.41
0.68
0.57
2.17
3.04
1.14
1.18
2.48
2.32
1.00
1.38
1.43
1.85
1.68
1.83
1.41
1.52
1.28
1.84
1.00
1.46
4.21
3.66
4.98
4.69
1.18
2.04
2.30
2.98
4.70
4.66
1.08
1.39
1.81
2.19
2.52
3.14
7.12
8.88
9.09
9.89
41.33
43.87
40.00
38.00
37.50
35.00
23.33
35.00
21.92
25.00
12.00
18.29
23.33
22.92
23.33
25.42
94.16
99.75
29.87
27.43
25.62
28.15
35.00
35.00
42.38
41.29
14.16
20.75
7.37
7.50
53.33
49.67
24.25
25.00
9.99
14.74
8.33
9.50
16.67
11.89
50.00
65.00
63.00
86.21
59.67
71.33
78.33
131.56
35.11
39.56
23.83
31.46
29.50
36.92
28.33
31.67
925.00941.6728.51
28.51
14,000 gallons
243.10243.10
68.80
65.79
88.33
88.33
1537.00
1808.00
364.50347.001049.00
1017.00
1954.50
1044.50235.75379.50
22.23
19.97
27.72
40.97
602.50650.751242.33
1050.50689.83770.58
34.31
40.72
55.48
59.65
7.63
7.62
3.98
5.93
9-12 oz
2.62
2.65
20-40 oz
6.48
7.73
30-64 oz
2.00
2.28
28-34 oz
4.02
4.05
25-37 sg ft
3.43
4.22
9.95
10.85
9.99
10.57
7.92
8.81
55.00
98.33
85.11
112.6087.50
110.0024495.00
23995.00
98.60
72.90
140.59169.15
4.50
4.75
7.86
13.48
15.00
15.00
85.00
85.00
638.67722.67127.50269.33
26.00
28.00
62.67
92.17
57.67
69.75
530.50525.75868.67969.00
10.00
10.00
18.95
30.75
19.42
20.69
2.86
6.16
8.80
9.95
12.42
13.21
35.83
39.33
14.00
15.00
3.54
3.50
3.54
4.08
5.37
6.82
7.20
6.61
13.65
15.70
24.75
32.50
34.99
96.66
55.00
63.74
300.00500.00
194.00272.50638.67722.67
unit
5 lb
5 lb
1 bag
7.25 oz
10-24 oz
1 lb
340 g
5 lb
1 lb
500 ml1 doz
15-24 slices
8 oz
40-48 oz
each
1 lb
each
1 lb
1 lb
1 lb
1 lb
15 oz
15 oz
15 oz
1 lb
1 lb
5 lb
12-16 oz
26 oz
13-20 oz12-15 oz
16.9 oz
42 oz
42-46 oz
750 ml6 pk

80

2024 Minimum Wage Advisory Committee

Appendix 5: Minimum Wage Employee Survey Results
Island of Employment
Island of Employment
TortolaVirgin Gorda
AnegadaJost Van Dyke
Other Islands
Not Stated
Total

Employees
666
109
30
1
12
7
825

Percent
80.7
13.2
3.6
0.1
1.5
0.8
100.0

Employees
199
424
181
20
1
825

Percent
24.1
51.4
21.9
2.4
0.1
100.0

Employees
184
636
5
825

Percent
22.3
77.1
0.6
100.0

Age Group of Respondent
18 - 29 years
30 - 49 years
50 - 64 years
65 years and over
Not Stated
Total

Sex of Respondent
Male
FemaleNot Stated
Total

81

2024 Minimum Wage Advisory Committee

Selected and Grouped Countries
British Virgin Islands
Other Overseas Territories
Other Caribbean Countries
Latin America
United States and Territories
CanadaUnited Kingdom
Other Countries
Not Stated
Total

Employees
455
5
214
16
86
2
7
26
14
825

Percent
55.2
0.6
25.9
1.9
10.4
0.2
0.8
3.2
1.7
100.0

Employees
1
19
222
9
262
278
2
32
825

Percent
0.1
2.3
26.9
1.1
31.8
33.7
0.2
3.9
100.0

Employees
390
50
162
56
143
24
825

Percent
47.3
6.1
19.6
6.8
17.3
2.9
100.0

Education Level of Respondent
No Formal Education
Primary
Secondary
Diploma-Certificate
College-Associate
University-Bachelors
University-Masters
Not Stated
Total
Nationality Status
Virgin Islander by Birth-Descent
Naturalized Citizen(VI)Belonger
Resident
Work Permit Holder/ Exemption
Not Stated
Total

82

2024 Minimum Wage Advisory Committee

Industries Grouped
Employees
Manufacturing
Construction
Mining, Quarrying, Electricity, Gas, Water
Market Services
Non-Market Services
Industry Not Stated
Total

3
11
2
395
168
246
825

Percent
0.4
1.3
0.2
47.9
20.4
29.8
100.0

Do You Receive Any Government Assistance?
Employees
Yes
No
Not Stated
Total

11
614
200
825

Percent
1.3
74.4
24.2
100.0

Do You Have Any Other Source of Income?
Employees
YesNo
Total Stated
Not Stated
Total

Percent
233
383
616
209
825

37.8
62.2
100.0
25.3
100.0

Do You Believe the Minimum Wage Should be Raised?
Employees
YesNo
Total Stated
Not Stated
Total

Percent
614
14
628
197
825

97.8
2.2
100.0
23.9
100.0

83

2024 Minimum Wage Advisory Committee

Average, Minimum and Maximum Hourly Pay, Hours Worked and Proposed Minimum Wage

Mean (Average)
Minimum
Maximum
Number of Employees

Hourlyrate of
pay?
18.47
4.00
630.00496

Hourly Pay
Rate
Without
Outliers
16.10
4.00
87.00
492

Averagenumber of
Proposed
hours
What should
Minimum
worked per
minimum
Wage Without
week
wage beOutliers
39.75
11.60
11.09
4.00
6.00
6.00
86.67
80.00
20.00
589
611
593

Island of Employment * Do You Receive Any Government Assistance?
Island of Employment
TortolaVirgin Gorda
AnegadaJost Van Dyke
Other Islands
Total

Do You Receive Any Government
Assistance
Yes
No
2.2%
97.8%
100.0%
100.0%
100.0%
100.0%
1.8%
98.2%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Island of Employment * Do You Have Any Other Source of Income?
Island of Employment
TortolaVirgin Gorda
AnegadaJost Van Dyke
Other Islands
Total

Do You Have Any Source of Income
Yes
No
39.5%
60.5%
34.1%
65.9%
18.2%
81.8%
100.0%
20.0%
80.0%
37.8%
62.2%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

842024 Minimum Wage Advisory Committee

Island of Employment * Do You Believe the Minimum Wage Should be Raised?
Island of Employment

TortolaVirgin Gorda
AnegadaJost Van Dyke
Other Islands
Total

Do You Believe the Minimum Wage
Should be Raised
Yes
No
97.8%
2.2%
97.6%
2.4%
95.5%
4.5%
100.0%
100.0%
97.8%
2.2%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%Age Group of Respondent * Do You Receive Any Government Assistance?
Age Group of Respondent

18 - 29 years
30 - 49 years
50 - 64 years
65 years and OverTotal

Do You Receive Any Government
Assistance
Yes
No
3.4%
96.6%
1.2%
98.8%
0.7%
99.3%
10.0%
90.0%
1.8%
98.2%

Total
100.0%
100.0%
100.0%
100.0%
100.0%Age Group of Respondent * Do You Have Any Other Source of Income?
Age Group of Respondent
18 - 29 years
30 - 49 years
50 - 64 years
65 years and overTotal

Do You Have Any Source of Income
Yes
No
36.1%
63.9%
37.3%
62.7%
38.6%
61.4%
70.0%
30.0%
37.8%
62.2%

Total
100.0%
100.0%
100.0%
100.0%
100.0%

85

2024 Minimum Wage Advisory Committee

Age Group of Respondent * Do You Believe the Minimum Wage Should be Raised?
Age Group of Respondent

18 - 29 years
30 - 49 years
50 - 64 years
65 years and OverTotal

Do You Believe the Minimum Wage
Should be Raised
YesNo
100.0%
96.1%
3.9%
99.3%
0.7%
100.0%
97.8%
2.2%

Total
100.0%
100.0%
100.0%
100.0%
100.0%

Sex of Respondent * Do You Receive Any Government Assistance?
Sex of Respondent

Male
FemaleTotal

Do You Receive Any Government
Assistance
Yes
No
1.5%
98.5%
1.8%
98.2%
1.8%
98.2%

Total
100.0%
100.0%
100.0%

Sex of Respondent * Do You Have Any Other Source of Income?
Sex of Respondent

Male
FemaleTotal

Do You Have Any Other Source ofIncome
Yes
No
47.4%
52.6%
35.3%
64.7%
37.9%
62.1%

Total
100.0%
100.0%
100.0%

Sex of Respondent * Do You Believe the Minimum Wage Should be Raised?
Sex of Respondent

Male
FemaleTotal

Do You Believe the Minimum Wage
Should be Raised
Yes
No
96.3%
3.7%
98.2%
1.8%
97.8%
2.2%

Total
100.0%
100.0%
100.0%

Selected and Grouped Countries * Do You Receive Any Government Assistance?
Selected and Grouped Countries

Do You Receive Any Government
Assistance
Yes
No

Total
86

2024 Minimum Wage Advisory Committee

British Virgin Islands
Other Overseas Territories
Other Caribbean Countries
Latin America
United States and Territories
CanadaUnited Kingdom
Other Countries
Total

1.2%
1.2%
3.4%

15.8%
1.8%

98.8%
100.0%
98.8%
100.0%
96.6%
100.0%
100.0%
84.2%
98.2%

100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Selected and Grouped Countries * Do You Have Any Other Source of Income?
Selected and Grouped Countries

British Virgin Islands
Other Overseas Territories
Other Caribbean Countries
Latin America
United States and Territories
CanadaUnited Kingdom
Other Countries
Total

Do You Have Any Other Source ofIncome
Yes
No
41.4%
58.6%
20.0%
80.0%
29.3%
70.7%
38.5%
61.5%
48.3%
51.7%
50.0%
50.0%
33.3%
66.7%
15.8%
84.2%
37.7%
62.3%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

87

2024 Minimum Wage Advisory Committee

Selected and Grouped Countries * Do You Believe the Minimum Wage Should be Raised?
Selected and Grouped Countries

British Virgin Islands
Other Overseas Territories
Other Caribbean Countries
Latin America
United States and Territories
CanadaUnited Kingdom
Other Countries
Total

Do You Believe the Minimum Wage
Should be Raised
Yes
No
98.3%
1.7%
100.0%
97.7%
2.3%
92.3%
7.7%
96.5%
3.5%
100.0%
75.0%
25.0%
100.0%
97.7%
2.3%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Education Level of Respondent * Do You Receive Any Government Assistance?
Education Level of Respondent

Primary
Secondary
Diploma-Certificate
College-Associate
University-Bachelors
University-Masters
Total

Do You Receive Any Government
Assistance
Yes
No
7.7%
92.3%
2.2%
97.8%
100.0%
3.0%
97.0%
100.0%
100.0%
1.8%
98.2%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Education Level of Respondent * Do You Have Any Other Source of Income?
Education Level of Respondent

Primary
Secondary
Diploma-Certificate
College-Associate
University-Bachelors
University-Masters
Total

Do You Have Any Other Source ofIncome
Yes
No
21.4%
78.6%
28.0%
72.0%
33.3%
66.7%
37.1%
62.9%
46.9%
53.1%
50.0%
50.0%
37.2%
62.8%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

88

2024 Minimum Wage Advisory Committee

Education Level of Respondent * Do You Believe the Minimum Wage Should be Raised?
Education Level of Respondent

Primary
Secondary
Diploma-Certificate
College-Associate
University-Bachelors
University-Masters
Total

Do You Believe the Minimum Wage
Should be Raised
YesNo
100.0%
98.9%
1.1%
100.0%
97.1%
2.9%
97.4%
2.6%
100.0%
97.8%
2.2%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Nationality Status * Do You Receive Any Government Assistance?
Nationality Status

Virgin Islander by Birth-Descent
Naturalizated Citizen(VI)Belonger
Resident
Work Permit Holder/ Exemption
Total

Do You Receive Any Government
Assistance
Yes
No
2.1%
97.9%
100.0%
0.8%
99.2%
2.5%
97.5%
2.7%
97.3%
1.8%
98.2%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Nationality Status * Do You Have Any Other Source of Income?
Nationality Status

Virgin Islander by Birth-Descent
Naturalized Citizen(VI)Belonger
Resident
Work Permit Holder/ Exemption
Total

Do You Have Any Other Source ofIncome
Yes
No
41.5%
58.5%
55.0%
45.0%
40.0%
60.0%
30.0%
70.0%
17.8%
82.2%
37.0%
63.0%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

892024 Minimum Wage Advisory Committee

Nationality Status * Do You Believe the Minimum Wage Should be Raised?
Nationality Status

Virgin Islander by Birth-Descent
Naturalized Citizen(VI)Belonger
Resident
Work Permit Holder/ Exemption
Total

Do You Believe the Minimum Wage
Should be Raised
Yes
No
99.3%
0.7%
97.6%
2.4%
93.4%
6.6%
100.0%
98.2%
1.8%
97.9%
2.1%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Employment Status * Do You Receive Any Government Assistance?
Employment Status

Full TimePart TimeTotal

Do You Receive Any Government
Assistance
Yes
No
1.9%
98.1%
100.0%
1.8%
98.2%

Total
100.0%
100.0%
100.0%

Employment Status * Do You Have Any Other Source of Income?
Employment Status
Full TimePart TimeTotal

Do You Have Any Source of Income
Yes
No
36.3%
63.7%
61.1%
38.9%
37.8%
62.2%

Total
100.0%
100.0%
100.0%

Employment Status * Do You Believe the Minimum Wage Should be Raised?
Employment Status

Full TimePart TimeTotal

Do You Believe the Minimum Wage
Should be Raised
Yes
No
97.9%
2.1%
94.6%
5.4%
97.7%
2.3%

Total
100.0%
100.0%
100.0%

90

2024 Minimum Wage Advisory Committee

Industries Grouped * Do You Receive Any Government Assistance?
Industries Grouped

Manufacturing
Construction
Mining, Quarrying, Electricity, Gas, Water
Market Services
Non-Market Services
Total

Do You Receive Any Government
AssistanceYes
No
100.0%
100.0%
100.0%
1.8%
98.2%
1.8%
98.2%
1.7%
98.3%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Industries Grouped * Do You Have Any Other Source of Income?
Industries Grouped

Manufacturing
Construction
Mining, Quarrying, Electricity, Gas, Water
Market Services
Non-Market Services
Total

Do You Have Any Other Source ofIncome
Yes
No
33.3%
66.7%
45.5%
54.5%
100.0%
33.9%
66.1%
46.4%
53.6%
38.0%
62.0%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Industries Grouped * Do You Believe the Minimum Wage Should be Raised?
Industries Grouped

Manufacturing
Construction
Mining, Quarrying, Electricity, Gas, Water
Market Services
Non-Market Services
Total

Do You Believe the Minimum Wage
Should be Raised
YesNo
100.0%
100.0%
100.0%
96.7%
3.3%
99.4%
0.6%
97.6%
2.4%

Total
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

91

2024 Minimum Wage Advisory Committee

What is your hourly rate of pay, Hourly Pay Rate Without Outliers, Average number of hours worked
per week, What do you think the minimum wage should be and Proposed Minimum Wage Without
Outliers * Island of Employment

Island of
Employment
TortolaVirgin Gorda
AnegadaJost Van Dyke
Other Islands
Not Stated
Total

What isyourhourly rateof pay?

Hourly Pay
Rate
Without
Outliers

20.15
12.34
8.58
18.00
14.57
10.00
18.47

17.19
12.34
8.58
18.00
14.57
10.00
16.10

Averagenumber ofhours
worked per
week?
39.21
43.09
41.18
40.00
34.25
39.75

What do you
think theminimum wage
should be?

Proposed
Minimum
Wage Without
Outliers

11.79
10.83
10.55
12.00
10.06
10.00
11.60

11.21
10.71
10.05
12.00
10.06
10.00
11.09

What is your hourly rate of pay, Hourly Pay Rate Without Outliers, Average number of hours worked
per week, What do you think the minimum wage should be and Proposed Minimum Wage Without
Outliers * Age Group of Respondent

Age Group of
Respondent
18 - 29 years
30 - 49 years
50 - 64 years
65 years and Over
Total

What isyourhourly rateof pay?
11.94
20.47
22.39
21.63
18.47

Hourly Pay
Rate
Without
Outliers
11.94
17.54
17.88
21.63
16.10

Averagenumber ofhours
worked per
week?
40.34
39.97
38.72
35.89
39.75

What do you
think theminimum wage
should be?
11.50
11.73
11.48
10.54
11.60

Proposed
Minimum
Wage Without
Outliers
11.29
11.13
10.80
10.54
11.09

What is your hourly rate of pay, Hourly Pay Rate Without Outliers, Average number of hours worked
per week, What do you think the minimum wage should be and Proposed Minimum Wage Without
Outliers * Sex of Respondent

Sex of Respondent
Male
FemaleNot Stated
Total

What isyourhourly rateof pay?
19.82
18.05
28.30
18.47

Hourly Pay
Rate
Without
Outliers
16.06
16.08
28.30
16.10

Averagenumber ofhours
worked per
week?
42.70
38.93
40.00
39.75

What do you
think theminimum wage
should be?
11.18
11.70
15.00
11.60

Proposed
Minimum
Wage Without
Outliers
11.00
11.10
15.00
11.09

92

2024 Minimum Wage Advisory Committee

What is your hourly rate of pay, Hourly Pay Rate Without Outliers, Average number of hours worked
per week, What do you think the minimum wage should be and Proposed Minimum Wage Without
Outliers * Selected and Grouped Countries
What isyourhourlySelectedandGrouped rate ofCountries
pay?
British Virgin Islands
18.62
Other Overseas Territories
12.33
Other Caribbean Countries
12.80
Latin America
12.48
United States and Territories
24.27
Canada340.00
United Kingdom
32.67
Other Countries
14.40
Not Stated
12.43
Total
18.47

AverageHourly Pay number of
Rate
hours
Without
workedOutliers
per week?
17.04
40.05
12.33
42.00
11.75
38.56
12.48
35.58
24.27
39.09
50.00
64.00
32.67
44.38
14.40
41.67
12.43
45.58
16.10
39.75

What do you
think
the
minimum
wage should
be?
11.32
11.40
11.84
10.63
11.59
11.00
12.50
14.64
12.25
11.60

Proposed
Minimum
Wage
Without
Outliers
11.13
11.40
11.17
10.63
10.55
11.00
12.50
10.84
11.45
11.09

What is your hourly rate of pay, Hourly Pay Rate Without Outliers, Average number of hours worked
per week, What do you think the minimum wage should be and Proposed Minimum Wage Without
Outliers * Education Level of Respondent
What isyourhourlyrate of
Education Level of Respondent pay?
Primary
8.62
Secondary
11.08
Diploma-Certificate
10.33
College-Associate
14.90
University-Bachelors
29.15
University-Masters
327.00Not Stated
11.57
Total
18.47

Hourly Pay
Rate
Without
Outliers
8.62
11.08
10.33
13.95
26.25
24.00
11.57
16.10

Averagenumber ofhours
workedper week?
41.64
39.03
40.00
39.09
40.54
76.50
40.00
39.75

What do you
think
the
minimum
wage should
be?
12.21
11.16
10.40
11.72
11.87
10.25
11.62
11.60

Proposed
Minimum
Wage
Without
Outliers
11.54
11.11
10.40
11.05
11.08
10.25
11.23
11.09

93

2024 Minimum Wage Advisory Committee

What is your hourly rate of pay, Hourly Pay Rate Without Outliers, Average number of hours worked
per week, What do you think the minimum wage should be and Proposed Minimum Wage Without
Outliers * Nationality Status
What isyourhourlyrate ofpay?
Birth- 20.25

Nationality Status
Virgin Islander by
Descent
Naturalized Citizen(VI)Belonger
Resident
Work
PermitHolder/Exemption
Not Stated
Total

AverageHourly Pay number of
Rate
hours
Without
workedOutliers
per week?
18.35
39.43

What do you
think
the
minimum
wage should
be?
11.35

Proposed
Minimum
Wage
Without
Outliers
11.11

17.85
18.85
13.75
17.22

17.85
17.35
13.75
11.21

36.33
41.15
39.87
40.39

10.95
10.83
15.25
11.84

10.59
10.65
12.72
11.01

12.05
18.47

12.05
16.10

38.48
39.75

12.13
11.60

11.66
11.09

What is your hourly rate of pay, Hourly Pay Rate Without Outliers, Average number of hours worked
per week, What do you think the minimum wage should be and Proposed Minimum Wage Without
Outliers * Employment Status

Employment Status
Full TimePart Time
Not Stated
Total

What isyourhourlyrate of
pay?
19.05
8.83
15.56
18.47

Hourly Pay
Rate
Without
Outliers
16.53
8.83
15.56
16.10

Averagenumber ofhours
workedper week?
40.28
28.87
50.00
39.75

What do you
think
the
minimum
wage should
be?
11.65
10.63
11.94
11.60

Proposed
Minimum
Wage
Without
Outliers
11.10
10.63
11.94
11.09

94

2024 Minimum Wage Advisory Committee

What is your hourly rate of pay, Hourly Pay Rate Without Outliers, Average number of hours worked
per week, What do you think the minimum wage should be and Proposed Minimum Wage Without
Outliers * Industries Grouped
What isyourhourlyrate ofIndustries Grouped
pay?
Manufacturing
27.00
Construction
16.84
Mining, Quarrying, Electricity, 33.50
Gas, Water
Market Services
17.51
Non-Market Services
19.70
Industry Not Stated
24.51
Total
18.47

AverageHourly Pay number of
Rate
hours
Without
workedOutliers
per week?
27.00
42.67
16.84
50.45
33.50
40.00

What do you
think
the
minimum
wage should
be?
10.83
11.92
9.00

Proposed
Minimum
Wage
Without
Outliers
10.83
11.01
9.00

14.58
19.70
16.88
16.10

11.23
12.52
11.49
11.60

10.96
11.28
11.49
11.09

39.19
40.51
38.71
39.75

95

2024 Minimum Wage Advisory Committee

Appendix 6: Minimum Wage Employer Survey Results
Island of Operation
TortolaVirgin Gorda
AnegadaJost Van Dyke
Total

Frequency
33
12
9
1
55

Percent
60.0
21.8
16.4
1.8
100.0

Frequency
1
1
2
1
41
6
3
55

Percent
1.8
1.8
3.6
1.8
74.5
10.9
5.5
100.0

Frequency
550
55

Percent
9.1
90.9
100.0

Frequency
17
2
12
18
2
4
55

Percent
30.1
3.6
21.8
32.7
3.6
7.3
100.0

Industries Grouped
Agriculture
Manufacturing
Construction
Mining, Quarrying, Electricity, Gas, Water
Market Services
Non-Market Services
Industry Not StatedTotal
Is Minimum Wage Sufficient to Meet Needs
Yes
No
Total
Impact Of Minimum Wage Increase
Little to No Impact
Business Closure
Increase Prices
Increase Wage Bill-Operating Cost
Decrease CompetitivenessLayoffs
Total

96

2024 Minimum Wage Advisory Committee

Below a $6 per hour rate, At $6 per hour rate, Above $6 per hour rate, Number of Businesses/Employees * Impact
Of Minimum Wage Increase

Impact Of Minimum Wage Increase
Little to No Impact

Business Closure

Increase Prices

Increase Wage Bill-Operating Cost

Decrease CompetitivenessLayoffs

Total

Businesses%
Employees%
Businesses%
Employees%
Businesses%
Employees%
Businesses%
Employees%
Businesses%
Employees%
Businesses%
Employees%
Businesses%
Employees%

below a $6
per
hour
rate
1
5.9%
2
0.7%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
1
25.0%
4
11.8%
2
3.6%
6
0.8%

at $6 perhour rate
1
5.9%
1
0.4%
1
50.0%
2
22.2%
4
33.3%
12
13.6%
5
27.8%
12
6.4%
1
50.0%
1
0.6%
2
50.0%
11
32.4%
14
25.5%
39
5.2%

above $6
per hour
rate
16
94.1%
274
98.9%
2
100.0%
7
77.8%
9
75.0%
76
86.4%
15
83.3%
175
93.6%
2
100.0%
15999.4%
4100.0%
19
55.9%
48
87.3%
710
94.0%

Number of
employees
17100.0%
277
100.0%
2
100.0%
9100.0%
12
100.0%
88
100.0%
18
100.0%
187
100.0%
2
100.0%
160
100.0%
4
100.0%
34
100.0%
55
100.0%
755
100.0%

97

2024 Minimum Wage Advisory Committee

What is the lowest hourly wage you pay in your business, What do you think the minimum wage shouldbe * Impact Of Minimum Wage Increase

Impact Of Minimum Wage Increase
Little to No Impact
Business Closure
Increase Prices
Increase Wage Bill-Operating Cost
Decrease CompetitivenessLayoffs
Total

What is the lowest hourly
wage you pay in yourbusiness?
9.47
6.00
7.70
8.86
7.00
6.50
8.43

What do you think theminimum wage should be?
8.50
7.50
8.69
8.58
8.00
7.00
8.46

Impact Of Minimum Wage Increase * Number of employees
Impact Of Minimum Wage Increase
Little to No Impact
Business Closure
Increase Prices
Increase Wage Bill-Operating Cost
Decrease CompetitivenessLayoffs
Total

Number of employees
277
9
88
187
160
34
755

%
36.7%
1.2%
11.7%
24.8%
21.2%
4.5%
100.0%

Impact Of Minimum Wage Increase * Island of Operation
Impact Of Minimum Wage Increase
Little to No Impact
Business Closure
Increase Prices
Increase Wage Bill-Operating Cost
Decrease CompetitivenessLayoffs
Total

Island of Operation
VirginTortola
Gorda
39.4%
25.0%
3.0%
21.2%
25.0%
27.3%
33.3%
16.7%
9.1%
100.0%
100.0%

Anegada
11.1%
11.1%
22.2%
44.4%
11.1%
100.0%

Jost Van Total
Dyke
30.9%
3.6%
21.8%
100.0%
32.7%
3.6%
7.3%
100.0%
100.0%

98

2024 Minimum Wage Advisory Committee

Impact Of Minimum Wage Increase * Industries Grouped Crosstabulation
Industries Grouped
Mining,
ImpactOf
Quarrying,
Agricul- ManufacMinimum Wage
Construction Electricity,tureturingIncrease
Gas,
Water
Little to No
100.0%
50.0%
ImpactBusiness Closure
Increase Prices
50.0%
Increase Wage 100.0%
100.0%
Bill-Operating
Cost
Decrease
CompetitivenessLayoffs
Total
100.0% 100.0%
100.0%
100.0%

NonIndustry
Total
MarketMarket Not
Services
Services Stated
26.8%

33.3%

66.7%

30.9%

4.9%
19.5%
34.1%

33.3%
33.3%

33.3%

3.6%
21.8%
32.7%

4.9%
9.8%
100.0%

3.6%

100.0%

100.0%

7.3%
100.0%

Businesses and Employees Minimum Wage Status

Businesses% of Businesses
Employees% of Employees

Below $6 per At $6 per hour
hour rate
rate
2
14
3.1%
21.9%
6
39
0.8%
5.2%

Above
$6
per
hour
rate
48
75.0%
710
94.0%

NumberBusinesses/
Employees
64755

Average, Minimum and Maximum Proposed Minimum Wage

Mean (Average)
Minimum
Maximum
Number of Employers

What is the lowest hourly wage
you pay in your business?
8.43
5.50
20.00
52

What do you think the minimum
wage should be?
8.46
7.00
12.00
28

99

2024 Minimum Wage Advisory Committee

Below a $6 per hour rate, At $6 per hour rate, Above $6 per hour rate, Number of Businesses/Employees* Island of Operation

Island of Operation

TortolaVirgin Gorda

AnegadaJost Van Dyke

Total

Busineses/
Employees
Businesses%
Employees%
Businesses%
Employees%
Businesses%
Employees%
Businesses%
Employees%
Businesses%
Employees%

Below$6 per
hour
rate
1
2.9%
2
0.5%
0.0%
0.0%
1
7.1%
4
6.6%
0.0%
0.0%
2
3.1%
6
0.8%

Above $6 Numberof
At $6 perper hour Busineses/hour rate
rate
Employees
6
17.1%
18
4.2%
2
15.4%
3
1.1%
5
35.7%
15
24.6%
1
50.0%
3
75.0%
14
21.9%
39
5.2%

28
80.0%
407
95.3%
11
84.6%
260
98.9%
8
57.1%
42
68.9%
1
50.0%
1
25.0%
48
75.0%
710
94.0%

35
100.0%
427
100.0%
13
100.0%
263
100.0%
14
100.0%
61
100.0%
2
100.0%
4
100.0%
64
100.0%
755
100.0%

100

2024 Minimum Wage Advisory Committee

Below a $6 per hour rate, At $6 per hour rate, Above $6 per hour rate, Number of Businesses/Employees* Industries Grouped

Industries Grouped

Businesses/
Employees

Businesses%
Agriculture
Employees%
Businesses%
Manufacturing
Employees%
Businesses%
Construction
Employees%
Businesses
Mining,Quarrying, %Electricity, Gas, Water
Employees%
Businesses%
Market Services
Employees%
Businesses%
Non-Market Services
Employees%
Businesses%
Industry Not Stated
Employees%
Businesses%
Total
Employees%

Below
a $6 per at $6 perhour
hour rate
rate
1
0.0%
100.0%
3
0.0%
100.0%
0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%

0.0%
2
4.1%
6
1.1%

0.0%

0.0%
10
20.4%
31
5.4%
3
42.9%
5
25.0%

0.0%

0.0%

0.0%
2
3.1%
6
0.8%

0.0%
14
21.9%
39
5.2%

0.0%

above $6 Numberofper hour Businesses/
rate
Employees
0.0%
0.0%
1
100.0%
60
100.0%
2
100.0%
65
100.0%
1
100.0%
1
100.0%
37
75.5%
533
93.5%
4
57.1%
15
75.0%
3
100.0%
36
100.0%
48
75.0%
710
94.0%

1
100.0%
3
100.0%
1
100.0%
60
100.0%
2
100.0%
65
100.0%
1
100.0%
1
100.0%
49
100.0%
570
100.0%
7
100.0%
20
100.0%
3
100.0%
36
100.0%
64
100.0%
755
100.0%

101

2024 Minimum Wage Advisory Committee

Below a $6 per hour rate, At $6 per hour rate, Above $6 per hour rate, Number of Businesses/Employees* Is Minimum Wage Sufficient to Meet Needs
Is Minimum Wage Sufficient to Businesses/
Meet Needs
Employees

Yes

No

Total

Businesses%
Employees%
Businesses%
Employees%
Businesses%
Employees%

Below
a $6 per at $6 perhour
hour rate
rate
1
0.0%
16.7%
8
0.0%
8.4%
2
13
3.4%
22.4%
6
31
0.9%
4.7%
2
14
3.1%
21.9%
6
39
0.8%
5.2%

above $6 Numberofper hour Businesses/
rate
Employees
5
83.3%
87
91.6%
43
74.1%
623
94.4%
48
75.0%
710
94.0%

6
100.0%
95
100.0%
58
100.0%
660
100.0%
64
100.0%
755
100.0%

102

2024 Minimum Wage Advisory Committee

What is the lowest hourly wage you pay in your business, What do you think the minimum wage shouldbe * Island of Operation?
Island of Operation
TortolaVirgin Gorda
AnegadaJost Van Dyke
Total

What is the lowest hourly wage
you pay in your business?
8.83
7.56
8.50
6.00
8.43

What do you think theminimum wage should be?
8.72
7.95
8.00
8.46

What is the lowest hourly wage you pay in your business, What do you think the minimum wage shouldbe * Industries Grouped
What is the lowest hourly wage
you pay in your business?
Agriculture
6.00
Manufacturing
10.00
Construction
10.27
Mining, Quarrying, Electricity, 8.00
Gas, Water
Market Services
8.06
Non-Market Services
9.50
Industry Not Stated
11.25
Total
8.43
Industries Grouped

What do you think theminimum wage should be?
7.50
8.00
8.47
8.00
10.00
8.46

What is the lowest hourly wage you pay in your business, What do you think the minimum wage shouldbe * Is Minimum Wage Sufficient to Meet Needs?
Is Minimum Wage Sufficient to
Meet Needs
Yes
No
Total

What is the lowest hourly wage
you pay in your business?
7.70
8.51
8.43

What do you think theminimum wage should be?
7.17
8.61
8.46

103