“HRMAB’s reaction to Barbados’ 2025-2026 Budget: By Nicholas Roberts, Pres. of the Human Resource Management Association of Barbados (HRMAB)”

The Barbados 2025-2026 Budget introduces key initiatives to strengthen economic resilience, support job creation, and enhance social welfare. While these measures are commendable, a human capital and workforce-focused perspective is critical to ensuring long-term sustainability.

Labour Market Recovery & Economic Diversification

Barbados’ economy has shown post-pandemic recovery, with GDP growth of 4% in 2024 and 3% projected for 2025. Unemployment has declined from 8.3% in 2023 to 7.1% in 2024, signaling positive momentum.

Tourism remains a primary economic driver, yet over-reliance on this sector presents long-term risks. The budget supports tourism growth through infrastructure investment and reduced air travel fees, but Barbados must diversify into emerging industries like financial services, fintech, and technology to build economic resilience. Lessons from Singapore and the Cayman Islands show how strategic investment in innovation and skills development can drive sustainable growth.

Addressing Labour Shortages & Demographic Shifts

With an aging population and low birth rates, Barbados faces a shrinking workforce, placing pressure on the economy. The budget’s fast-track work permits are a positive step, but Barbados must take a structured approach to skilled labour importation, similar to Bermuda and the Cayman Islands, to attract and retain professionals in high-demand industries such as technology, healthcare, and finance.

Likewise, underemployment remains a concern in HRMAB’s opinion, with a need for more stable, high-value job opportunities for our local human resources. Which could combat the brain-drain of our human capital, a problem that Barbados has been increasingly facing.

Social Welfare & Workforce Development: Strengths & Opportunities
The budget introduces several pro-worker initiatives, including:
• A 2% annual increase in the minimum wage
• Zero VAT on essential food items
• Extended maternity leave (14 weeks) and new paternity leave (3 weeks)
• Increased pensioner tax exemptions
While these are positive steps, Barbados must further expand social support structures, including tax breaks for businesses investing in workforce development, childcare subsidies, and housing incentives to retain young professionals.
HR-Focused Recommendations for a Sustainable Future

1. Enhance Tax Relief & Social Incentives
   o Offer tax incentives for workforce training and skills development.
   o Provide childcare tax credits to support working parents.
   o Implement housing incentives to retain young professionals.
2. Strengthen Workforce Expansion Strategies
   o Develop a Caribbean Talent Mobility Framework to attract skilled workers from the region.
   o Establish clear pathways to long-term residency or citizenship for foreign professionals in high-demand sectors.
3. Invest in Digital & Workforce Transformation
   o Expand 5G infrastructure and AI-driven industries to foster high-value digital jobs.
   o Offer subsidized digital training programs in cybersecurity, data analytics, and AI.
4. Promote Public-Private Partnerships in Education & Training
   o Strengthen collaboration between government, private sector, and tertiary institutions to align education with industry needs.
   o Expand paid apprenticeship programs to ensure young professionals gain real-world experience.
   
   Conclusion: A Collaborative Approach to Workforce Development
   
   The 2025-2026 budget lays a strong foundation for economic stability and workforce development. However, for long-term growth, Barbados must focus on strategic economic diversification, expanded talent attraction, and strengthened social policies.
   
   HRMAB urges a collaborative approach between government, businesses, and educational institutions to build a resilient and future-ready workforce. By investing in people-centered policies, Barbados can ensure sustainable growth and national prosperity for generations to come.