Am. Samoa Commerce Dept. Eyes Monitoring Entity

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Report recommends gathering employment, private sector data

By Fili Sagapolutele

PAGO PAGO, American Samoa (The Samoa News, Nov. 25, 2013) – American Samoa’s Dept. of Commerce (DOC) is recommending the establishment of an entity to gather employment and unemployment data as well as monitor private sector activities, especially one which keeps count on the number of businesses that close.

These were some of the recommendations outlined in DOC’s fiscal year 2013, 4th quarter performance report covering the period of July 1 to Sept. 30. The report pointed out that small businesses in American Samoa have a high turnover rate of ownership and management composition.

The report says small businesses change ownership for a large number of reasons — cash flow problems, poor management, businesses transferred to relatives, sponsorship of aliens, social security mandates, immigration status, lower quality products, insufficient advertising and under capitalization, said DOC.

"Our unique culture adversely affects the market force," said DOC. "Thus local businesses are vulnerable to competition from neighboring islands with lower wages and from larger businesses in the U.S."

The Business License Applications Status Report (Sept. 30, 2013) reveals 288 new business license applications for the period of Apr. 24-June 30, which was 55% of total business license applications processed and approved while 110 business license applications were for change of ownership or about 21% of the total, said DOC.

Additionally, 121 businesses applied for additional activities (24% of total) and one business made application for relocation.

These are all third quarter figures not available when the third quarter report was released. The 4th quarter report does not give data for how many business license applications were processed and approved during the last quarter of FY 2013. This data is not expected until early next year.

It does says that based on the last report - Apr. 4, 2013 - provided by the Revenue Bureau of the Treasury Department a total of 2,776 business licenses were registered with the Revenue Bureau.

As for recommendations, DOC said it has no mechanism in place to monitor or provide a daily update on the number of businesses that have closed down and it is the same case when it comes to monitoring unemployment in the territory.

The report says that there must be an agency within the Human Resources Department (DHR) or some government department for businesspersons and/or unemployed persons to file the information for statistical purposes.

DOC recommends that its Research & Statistics Division - as mandated by the Statistical Act of 2003 — should look into this task and devise a survey/tool or something similar to the Business Quarterly Survey in order to collect this type of data.

"We also recommend the establishment of an Unemployment Agency within DHR to gather employment and unemployment figures for all sectors of the economy," including the territorial government and semi autonomous agencies, said DOC.

The proposed recommendations would definitely assist the U.S. Bureau of Economic Analysis with their ongoing project of compiling and updating the gross domestic product and economic indicators for the territory, the report concludes.

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