Narrative: II. a. 1. A.

A. Economic, Workforce and Workforce Development Activities Analysis For the past 50 years, the two industries that have sustained American Samoa’s economy have been the government and the tuna industry. Although the organizations that operate within these industries function as independent entities, they all benefit from their association with the United States Government. For example, the United States Government annually appropriates over $20 million to the American Samoa Government as an operating budget. Additionally, the United States Government spends hundreds of millions of dollars in American Samoa in the form of grants, loans, programs, products, services, employment, leases, and commercial transactions. While the tuna canneries do not receive direct financial assistance, they enjoy special tax and tariff treatments from the

Federal Government. Without the assistance of the Federal Government, American Samoa’s economy would be severely impacted. Consequently, the goal describes the type of market economy the Territory wants to realize as ‘self–sustaining’. The term self–sustaining acknowledges the continued economic and political relationship between the United States and American Samoa while conveying the Territory’s desire to develop and generate additional sources of income and properly manage outlaying costs. Traditionally, American Samoa’s economy has three sectors (as described by the Economic Advisory Commission): Primary, Secondary, and Other. Primary Industries: The two industries that fall within the primary sector are the American Samoa Government (ASG) and the tuna cannery industry because they are the ‘primary’ forces that drive our economy. They are the largest employers and have the greatest revenue base. American Samoa Government (ASG) The ASG supports the local economy through wages, infrastructure construction, public services, and purchases. Tuna Canneries: The canneries contribute to the territorial economy through payment of wages, fishing fleet purchases, income taxes, oil, lease rents, and supporting economies of scale for shipping, air transportation, and utilities. Secondary Industries: Industries that fall within the second sector have been designated as ‘secondary’ because most of their commerce is dependent on the primary sector. Tourism: Tourism development remains elusive despite acknowledgement of its positive contribution to bolstering the Territory’s economic system.

Agricultural Development: Agricultural Development is still a subsistence activity, which perpetuates the dependence on imports and continuing the pattern of economic leakage. Industrial Development: Industrial Development has historically been inconsistent and is easily manipulated and controlled by strong industry lobbyists. Business Development: Traditional Business Development has depended largely upon purchases and payments by the Government and the canneries. Other Industries: Businesses that fall within the third sector have been categorized as ‘other’ because they tend to operate independently from the other two sectors by catering to individual households, consumers, and represent industries that have not traditionally been a part of American Samoa’s economy. Technology and Innovative Businesses: More recently, streams of technological companies have developed in American Samoa. These companies provide services in high skilled trades such as telecommunication, computer and technology systems, water purification, and a number of other areas. Arts & Crafts: With more exposure in our global economy, the Samoan culture has witnessed a demand for traditional Samoan arts and crafts. Musicians have also made a name for themselves in the global music industry. . Projected Growth Industries What industries and occupations are projected to grow and/or decline in the short term and over the next decade?

In a recent article in the Wall Street Journal, Norman R. Augustine and Burton Richter address a phenomenon called “Our Ph.D. Deficit.” Augustine and Richter identify that the unprecedented opportunities for American Workers in the latter half of the 20th century came from creating new jobs, not from protecting old ones. A major component of job creation is investment in science research. Because of this, American Samoa is committed to identifying industries, which promote the creation of new jobs through innovative techniques and research.

Another consideration that the ASWIB encountered during its reevaluation phase was an understanding the role that the private sector employers play in our local economy. The ASWIB recognizes that in a market economy, there is a direct correlation between the level of private sector entrepreneurial activity and the health of the economy and that an increase in suitable entrepreneurial activity contributes to a more robust economy. As noted in the Territorial Plan for Transforming the Economy of American Samoa, the private sector is comprised of two entities: Business Firms, and Household Consumers. These two entities are the driving forces behind our future economic growth and the industries that we’ve identified are strategically aligned to meet the needs of innovation and our dual–entity private sector.

Growing Industries: To diversify the economy in American Samoa, the ASWIB calls for the private sector to assume a leadership role in building the economy and articulating the needs of our local employment sector. Because of this, the ASWIB has identified and supports the development of five growth industries: 1. Fisheries and Agriculture; 2. Telecommunication and Information Technology; 3. Manufacturing; 4. Visitor; and 5. Handicrafts

Advocating for the development of these five industries not only supports the goal of allowing the private sector to become the driving force of the economy, but also addresses the issue of a need to diversify the economy. These industries will serve as the cornerstone of a self–sustaining market economy.

Within each industry, the Economic Development Plan calls for the development of various enterprises that are classified into three tiers. Assigning tier levels recognizes that the industries and enterprises will mature at different rates due to varying conditions, circumstances, and resources. It also presumes that the various stages of development will occur concurrently, consecutively, and at times on entirely different schedules.

Tier one enterprises have the greatest potential to take root, flourish and attract new enterprises and industries that promise higher added value and greater productivity. Tier Two enterprises have immense possibilities but will require more time and resources to develop. Tier three enterprises represent ‘spin–off’ industries and enterprises that will naturally evolve as the core industries mature.

The mapping out of the direction and timing of the Territory’s economic development can serve as a guide to those responsible for implementing the various aspects of the Plan. Each of these enterprises has the choice to compete in at least one of the four identified major markets: Local (within American Samoa), U.S. (any market within the U.S.), Pacific (any market in the Pacific Rim, not U.S.), and Global (any market outside of the other 3 identified markets).

Additional industries of growth are related directly to the overall growth of the economy and its impact on the social services of the Territory. These industries are considered critical to the overall good of the territory and are essential in the ability of the Territory to adapt to any and all economic growth: 1. Health service industry (nurses, doctors, laboratory assistants, counselors) 2. Education industry (teachers, counselors, school administrators, school lunch and custodian services, coaches, and research assistants) 3. Small businesses in the food supply markets (wholesale food suppliers, distributors, and transporters). 4. Small businesses in venture capital. Declining Industries: Because American Samoa is postured to grow in the next decade, we anticipate all private industries to grow. It is our intent for the public sector to play a smaller role in the overall economy of American Samoa.

While the role of the private sector is clearly stated in the goal statement, the role of the public sector is less explicit–but just as significant. The ASWIB believes that our Government should enable real economic growth by assuming a role as a facilitator for economic growth via incentives and implementing positive and proactive policies that spur economic growth and encourage entrepreneurial activities.

There is a need for the Government to track economic growth and capital investments through the use of diagnostic tools and properly measured data. The Government should also pursue a multi–track approach for developing the Territory’s physical, human, and financial infrastructures through assistance and support. Overall, the Board advocates for a proactive Government who grasps the complexity of our current economy by implementing innovative and enterprising solutions to effect positive and sustainable economic viability for the 21st century.

Part of ASG’s responsibility is addressing numerous pending and pressing Federal issues that impact our Territory. These include the elimination of certain tax and

tariff benefits, on–going international trade agreements, the application of minimum wage rates, air service restrictions, harbor maintenance costs, and matching funds for capital improvement projects. By not resolving some of these issues, the Territory’s economy will continue to struggle and remain stagnant.

While ASG will remain an integral part of American Samoa’s Workforce System, we hope that it will remain focused on positively affecting our efforts by: 1. Reversing the long–standing trend of budget deficits; 2. Improving the overall fiscal standing of ASG through the refinement of accounting, auditing, enforcement, and disclosure practices; 3. Strengthening commercial laws so as to improve private sector initiatives and incentives; 4. Reducing discretionary spending; 5. Eliminating duplicative efforts and redundant tasks; 6. Improving business and economic development protocol such as immigration, employment practices, tax treatment, and enforcement; and 7. Streamlining the processes of obtaining the necessary approvals, permits, and licenses to conduct business or build infrastructure in American Samoa. 8. Increase revenues driven by pro–business tax incentives that in turn generate greater revenues for the Territory.

By focusing on these improvements, we believe that the public sector will provide higher quality, better coordinated, and more efficient services to the citizenry of American Samoa and do so by reducing its overall role in our economic system.

During a recent economic development survey completed by ASCC for the Economic Development Board, the respondents identified the following industries as viable industries that American Samoa should encourage:

6 Demand for skilled workers and available jobs: In what industries and occupations is there a demand for skilled workers and available jobs, both today and projected over the next decade? In what numbers? To address the needs of our growing industries, the ASWIB recognizes that research, particularly in the physical sciences and engineering, will become the foundation of our innovative and economy of the future. With the establishment of a technological based economy, we believe that new and higher waged jobs will evolve. Because American Samoans are quick to develop, produce, and market new innovations, we have the capability to handle such innovation, which ultimately will not only create new jobs but will stimulate revenues as well. In a nimble and ever–competitive global environment, it is essential that our Workforce be prepared to meet the needs of a highly innovative and dynamic economy. To do so, our System must first meet the current demand for skilled workers and fill the shortage of workers in the following industries: 1. Healthcare Industry (all positions) 2. Education Industry (teachers) 3. Research (biologists, engineers) 4. Public safety (police) 5. Information technology (computer programmers) 6. Accounting 7. Tourism (leisure and hospitality) 8. Handicrafts

Over the next decade, we expect these areas to demonstrate strong employment growth whereby education and health services will add the most jobs (1,000+

7 additional jobs), followed by professional services such as research, accounting, and information technology, then followed by culturally based careers in industries such as tourism and handicrafts.

Critical Jobs and Occupations: What jobs/occupations are most critical to the Territorial’s economy?

To keep American Samoa’s innovation, robust investments in research are a must. As a nation, we recognize that Federal funding for research in the physical sciences and engineering must improve, as it has been stagnant for over two decades. As a percentage of GDP, Federal investment in the physical sciences is half of its level in 1970. We believe that on an national level, this trend must end and when increased funding opportunities present themselves, American Samoan must be prepared to seize these opportunities and to fully capitalize on the growth potential for our economy. To do so, a number of jobs and occupations are critical to ensure proper preparation for the change in innovation funding. Therefore, the most critical occupations to American Samoa’s economy are in the industries that we identified as critical in preparing our workforce for infrastructure sustenance and economic growth. We’ve identified the following occupations in our leading growth industries as critical to the success of our current economy and our economy to come: 1. Health service industry (nurses, doctors, laboratory assistants, counselors) 2. Education industry (teachers, counselors, school administrators, school lunch and custodian services, coaches, and research assistants) 3. Small businesses in the food supply markets (wholesale food suppliers, distributors, and transporters).

These industries are critical because the jobs/occupations that they provide offer the stability necessary to launch future growth initiatives in other industries such as the identified four growth areas. The professionals who participate in these industries are required to stay current on new methodologies and are thus the backbone of our community––a necessity rather than a luxury. Once these occupations are addressed, the other critical jobs and occupations are in the following industries: 1. Fisheries and Agriculture (fishermen, farmers, horticulturalists, biologists, merchant marines, ship engineers, and marine biologists); 2. Telecommunication and Information Technology (computer programmers, technology and network service agents, engineers, mechanics, and telecommunications experts); 3. Manufacturing (seamstresses, designers, factory managers, product developers, engineers, and mechanics); and

8 4. Visitor (marketers, hospitality industry, culinary and cuisine experts, arts and crafts, historians, and construction workers such as carpenters, glaziers, painters, metal workers, etc.).

Skill needs: What are the skill needs for the available, critical and projected jobs?

There are a number of critical skills needed to meet the needs of our available and critical jobs. Many of these involve professional credentialing and experience. By addressing the shortfalls of our basic skills now, we have the ability to improve our overall skills quickly. 1. Health service industry (nurses, doctors, laboratory assistants, counselors) a. Reading comprehension b. Critical thinking c. Research capabilities d. Mathematics e. Speaking f. Reasoning g. Problem solving h. Work–based skills and professional credentialing i. Positive attitudes j. Sensitivity to cultural issues 2. Education industry (teachers, counselors, school administrators, school lunch and custodian services, coaches, and research assistants) a. Reading comprehension b. Critical thinking c. Research capabilities d. Mathematics e. Speaking f. Reasoning g. Problem solving h. Work–based skills and professional credentialing i. Social perceptiveness j. Strong communication skills 3. Small businesses in the food supply markets (wholesale food suppliers, distributors, and transporters). a. Environmental knowledge b. Biological and horticultural understanding c. Sales and marketing d. Commercial drivers licensing e. Scheduling and distribution lines

9 While the opportunities for career expansion increase as economic expansion occurs, the ASWIB has identified the following skills as essential for our current employees. Occupation Skills Abilities Knowledge Training/Education Requirements Growth Potential Registered Nurses, Doctors, Dentists, Laboratory Assistants, and Health Counselors Active Listening, Reading Comprehension, Critical Thinking, Speaking, Credentialing Problem Sensitivity, Oral Comprehension, Reasoning, teaching Medicine & Dentistry, Psychology, Customer & Personal service, English, Biology Associate Degree, Bachelor’s Degree, Master’s Degree, Doctorate Degree, Professional Experience Double current rate. Educators Reading Comprehension, Mathematics, Critical Thinking, Speaking, Writing, English, Strong Communication Skills, Organization Problem Solving, Written and Oral Comprehension, Reasoning, Cultural Knowledge All subject areas, Counseling, Computer and Technology Skills Associate Degree, Bachelor’s Degree, On–going professional development, Masters Degree, Doctorate 31.5% growth Small business and Food Supply Business skills (accounting, budgeting, marketing) Reading comprehension, Critical thinking, Speaking, Writing, Strong Management skills Reasoning, Analysis, Critical Thinking Business Savvy, Computer and Technological Skills, Distribution skills, Management Skills, Transportation understanding Professional experience, small business management, associate degree or higher 30.9% growth Fisheries and Agriculture Critical Thinking, Speaking, Reasoning, Planning Analysis, Organization, Patience, Critical Thinking Business skills, marketing, botanist, horticulturalist, marine biologist, biologist Associate’s degree, Bachelor’s degree, Professional experience 28.3% growth Telecommunication and Information Technology Critical Thinking, Problem Solving, Computer programming, Analysis, Mathematics, Scientific, Reading and Writing Skills, Effective Communication Skills, English Forecast trends, Analysis and Research, Critical Thinking, Problem solving Computer programmer, Network maintenance, Software developer, Research analyst, Small business manager, Teacher, Engineer High School Diploma, Associate’s degree, Bachelor’s degree, Professional experience, Trades certified 25%+ Growth Manufacturing Reading Comprehension, Writing, Detail oriented, Mathematics, Effective communication skills, English Critical thinking, problem solving Engineers, Mechanic, Seamstresses, Cutters, Managers, Production Planners Certified trades ability, professional experience, High School Diploma, Associate’s degree 20% growth Tourism Reading comprehension, strong communication skills, hospitality, positive attitude, knowledge of culture, problem solving Critical thinking, problem solving, strong communication skills, planning and coordinating skills Hospitality Specialists, Hotel and Leisure Managers, Planning and Development Coordinators, Traditional Handicraft Specialists, Marketing GED or High School Diploma, Associates Degree, Bachelors Degree 18.76% growth

Current Demographics of Labor Pool: What is the current and projected demographics of the available labor pool (including the incumbent workforce) both now and over the next decade?

As collected by the Department of Commerce in 2000, the following census information provides the demographics of American Samoa’s labor pool, as it existed in 2000. At a growth rate of about 5.6% one can easily forecast the growth in population and by reasonable analysis of the following data, the Board was able to forecast changes in our economy as depicted by the changes in our demographics.

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Subject Number Percent Total Population 57291 100 Male 29264 51.1 Female 28027 48.9 Under 5 7820 13.6 5–9 Years 7788 13.6 10–14 Years 6604 11.5 15–19 Years 5223 9.1 20–24 Years 4476 7.8 25–34 Years 8707 15.2 35–44 Years 7361 12.8 45–54 Years 4733 8.3 55–59 Years 1474 2.6 60–64 Years 1204 2.1 35–74 Years 1345 2.3 75–84 Years 465 0.8 85 + Years 91 0.2 Median Age 21.3 –

Households 9349 100 Families 8706 93.1 With own children 6297 67.4 Married Families 6596 70.6 Female Householder 1398 15.0 Average Family Size 6.24 – School Enrollment (over 3 years) 20830 100 Nursery/Pre–School 1557 7.5 Kindergarten 1736 8.3 Elementary (1–8) 11418 54.8 High School (9–12) 4645 22.3 College or graduate school 1474 7.1

Educational Attainment (population 25 years +) 25380 100 Les than 9th grade 3120 12.3 High school equivalency 9983 39.3 Some college (no degree) 3173 12.5 Associate degree 1755 6.9 Bachelor’s degree 1224 4.8 Graduate or professional degree 649 2.6 Percent high school graduate or higher – 66.1 Percent bachelor’s degree or higher – 7.4

Ethnic Origin and Race Samoan 50545 88.2 Niuean 18 0.0 Tokelauan 45 0.1 Fijian 80 0.1 Tongan 1598 2.8 Chinese 329 0.6 Filipino 792 1.4 Japanese 16 0.0 Korean 200 0.3 Asian Indian 13 0.0 Other Asian 281 0.5 White 655 1.1 Black or African American 21 0.0 Some other race or ethnic group 124 0.2

Employment Status Population 16 years + 33945 100 In labor force 17664 52.0 Civilian labor force 17627 51.9 Armed Forces 37 0.1 Not in labor force 16281 48.0 Females 16 Years + In labor force 7335 43.8 Not in labor force 9420 56.2 Own Children under 6 7338 100 All parents in family in labor force 2909 39.6 Own children 6–17 Years 13112 100 All parents in family in labor force 5831 44.5 Population 16–19 Years 4089 100 Not enrolled in school and not high school graduate 687 16.8 Unemployed or not in labor force 561 13.7

Occupation Employed civilian population 16 years + 16718 100 Management, professional and related occupations 4145 24.8 Service occupations 1822 10.9

Sales and office occupations 2966 17.7 Farming, fishing, and forestry occupations 533 3.2 Constructions, extraction, and maintenance occupations 1868 11.2 Production, transportation, and material moving occupations 5384 32.2 Private wage and salary workers 11346 67.9 Government Workers 5002 59.9 Self–Employed in non incorporated business 336 2.0 Unpaid family workers 34 0.2

Income Distribution Households 9349 100

$2,500 509 5.4 $2,500–$4,999 250 2.7 $5,000–$9,999 1585 17.0 $10,000–$14,999 1535 16.4 $15,000–$24,999 2079 22.2 $25,000–$34,999 1226 13.1 $35,000–$49,999 1029 11.0 $50,000–$74,999 739 7.9 $75,000+ 397 4.2 Median Household Income $18,219 –

Current Migration Issues: Is the Territorial experiencing any “in migration” or “out migration” of workers that impact the labor pool?

Currently American Samoa is witnessing an out migration of workers to other States. While this was countered by in migration of foreign workers, such in migration occurred solely in the tuna cannery and fishery industries and did not displace the loss in the high–skilled industries. The ASWIB has identified a number of issues that cause the out migration of workers from American Samoa. 1. Low wages: Low wages in comparison to neighboring States and pacific jurisdictions has caused our high–skilled members of the labor force to locate work outside of American Samoa. We may see a greater move of workers as many businesses contemplate closure due to the current proposed minimum–wage increase. 2. Slower growth: While American Samoa is embracing growth opportunities, our physical location deterred the influx of business growth due to costs associated with transportation, distribution, and housing. This is a detriment to our economic growth and has caused American Samoa to grow at a much slower pace than our neighbors. 3. Infrastructure: American Samoa is slow to build and grow its infrastructure because our delicate island Territorial is subject to major environmental impacts and there is a lack of funding to improve upon our current infrastructure. Because of this, American Samoa is behind in the ability of its current infrastructure to sustain rapid economic growth, rendering us at a competitive disadvantage to our neighboring States. We are addressing this issue in the next two years and anticipate greater progress in our infrastructure planning.