Posted on: Friday, September 24, 2004

ISLAND VOICES

By C. Richard Fassler

How can we compete against low-wage tourism?

How do you compete against someone who makes $2.50 an hour?

If you're from Hawai'i, you might say: "Not very well."

When Norwegian Cruise Line agreed to hire an all-U.S. crew in exchange for exclusive rights to sail around the Islands, many people hailed the action as a boon to our local labor force.

But two months later, there are doubts whether our American workers can cut the mustard.

The rash of complaints against the employees of NCL's Pride of Aloha, described by Catherine Toth in her Aug. 28 article, raises the critical question: "Can U.S. workers compete against foreign workers for low-paying service jobs?" Judging by the performance to date of NCL's American staff, the answer seems to be "No!"

The implications for the future of Hawai'i's economy, which depends on a plentiful supply of low-paid local workers to support our most important industry — tourism — are disturbing. Let's take a closer look at the cruise industry.

In the early part of this century, cruising was for the super rich. The steamship companies charged high prices and hired European crews. In recent decades, cruise lines have dropped their rates considerably, enabling middle-income families to take over as the dominant passenger group on cruise lines. How was this possible?

Because the shipping companies discovered that they could increase traffic and make more money by hiring crews from Third World countries. They were skilled, hard-working, and — above all — cheap.

My wife and I recently discovered this on the Costa Fortuna, an Italian ship, sailing out of Italy to Spain and Northern Africa. The crew was mostly Filipino, Indonesian and Chinese. They washed linen, cleaned toilets, scrubbed the decks and waited on tables. They worked 12 hours a day, seven days a week, and seven months a year without a single day off. After five months at home, they signed another contract and repeated their work assignment.

One employee I spoke to — Joseph — like many of his co-workers, had earned a college degree. He quit a $250-a-month broadcasting position in the Philippines to spend his 12-hour-day walking around in the hot sun, selling cocktails to passengers in lounge chairs. For this, he was paid $900 a month ($2.50 an hour), a sum that enabled him to support his wife and daughter in Manila, with something left over to put in the bank.

Did Joseph grumble about his lot in life? Absolutely not! He was ecstatic to have the opportunity and encouraged his friends to work on the ship.

And the Philippines is not the only nation supplying quality labor at low prices. Not long ago, a friend of mine wanted to hire a Chinese girl to work as a secretary for his Beijing office. He found a recent college grad with exceptional English-language skills who was delighted to work for $300 a month ($1.87 an hour).

If NCL wants to provide the kind of first-class service that today's cruise passengers demand, it will have to raise wages to attract more qualified (and harder-working) people, and this is likely to mean higher prices for their Hawai'i cruise. And because this will make them less competitive, the company clearly faces a dilemma.

Hawai'i is faced with the same dilemma, which should be a wake-up call for our visitor industry. We are encountering rapidly increasing competition for the tourist dollar from such lower-cost destinations as Hainan, Cancun, Bali and Bangkok.

Like the Pride of Aloha crew members, we must work harder and offer better service, or we will lose our tourism jobs. If we cannot meet this challenge, then we should educate our young people for careers in other, non-tourism areas — areas where we will be able to compete with university-educated Chinese who may speak better English than we do.

C. Richard Fassler is writing Hawai'i's College Guide, from Preschool to High School.