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Senator argues for delay of wage hikes to 2015

U.S. Sen. Jeff Bingaman told his congressional colleagues last Friday that “trade globalization and rising costs” contributed to American Samoa’s “severe economic down turn” and urged senators for expedited approval of federal legislation, which includes a provision to delay minimum wage hikes in American Samoa.

Bingaman’s arguments were made just before the U.S. Senate via “Unanimous Consent” approved the ‘Insular Areas Act’ (or S. 2009) — sponsored by Bingaman and co-sponsored by Alaska Sen. Lisa Murkowsky — which delay the wage hikes from Sept. 30, 2012 to Sept. 30, 2015.

The measure would also delay a periodic U.S. Government Accountability Office report on the impact of prior wage increases on American Samoa and the Commonwealth of the Northern Mariana Islands from a 2-year to a 3-year, cycle.

Gov. Togiola Tulafono expressed gratitude over passage of the federal Insular Areas Act in the U.S. Senate in a statement released Monday evening.

“During the happiest time of the year, we continue to receive great news with the passing in the U.S. Senate of this important bill that is an important step in providing our local businesses, especially in the fisheries and canning industries, assurance that the minimum wage in American Samoa will remain steady and stable for the next three years and beyond,” said Togiola.

“We hope that the U.S. House of Representatives will also pass the bill, and should the bill become law, it will provide incentive to our local canneries to invest in equipment and infrastructure to expand their operations, and it will likely prompt them to significantly increase production,” he said.

“Such an increase in production will mean more employment opportunities for our people in the Territory who are searching for work. For those people who continue to struggle to find work, any new jobs attributable to Congress’ halt to the scheduled minimum wage increases will be a great benefit,” he added.

Congressman Faleomavaega Eni said last Friday that as the bill moves to the House for consideration, “we’ll have to watch and wait because two other issues — the monitoring of Runit Island and clarifying the temporary assignment of judges to courts of the Freely Associated States – have been included in S. 2009”.


Senate records of last Friday’s proceedings on this measure, state that Bingaman — (D-NM), chairman of the Committee on Energy and Natural Resources, which has jurisdiction for the U.S. Insular Areas — urged passage of the bill and explained to his colleagues the reason for this important measure with its “time-sensitive” provisions.

On the minimum wage, Bingaman explained that American Samoa is a small, remote, unincorporated and unorganized U.S. territory, and the only American territory in the  Southern Hemisphere.

“Its economy more closely resembles that of the nearby island-nation of Samoa than it does the U.S. economy. It has a large subsistence sector, as indicated by a 30 percent unemployment rate, and an average per capita income of about $7,000 year — less than a quarter of the poorest state,” he said, adding that the local wage economy “is concentrated in the government sector and fish processing.”

“In recent years, however, trade globalization and rising costs have contributed to a severe economic down turn,” said Bingaman and cited the most recent GAO report that one of two tuna canneries closed in 2009 and the other cannery significantly reduced operations.

“Employment in this key sector fell by 55 percent from 2009 to 2010,” he said referring to cannery operations.

He went on to explain that the  U.S. minimum wage was extended to American Samoa in 2007, with annual increases of 50 cents starting in 2008. “But, because of the severe down turn, Congress delayed the 2010 wage increase until 2012,” he said.

“The Government of American Samoa is requesting this further delay because of the unique and continuing challenges it faces along with other South Pacific island economies,” he said.

The bill is now with the U.S. House Committee on Education and Workforce but passage of the measure remains to be seen.