More than a year ago a former Premier of this country, Paula Cox, in an interview on Sherri Simmons’s show on Magic 102FM, conveyed her frustration in being unable to secure a job within our offshore Insurance sector.

Ms Cox, who was also a great supporter and friend to the industry while serving as finance minister and latterly as Premier, actually once held the position of legal counsel for one of the oldest and venerable of reinsurance companies in Bermuda, prior to the Progressive Labour Party forming the government in 1998.

As related by Ms,Cox during the interview, she was informed by an industry executive that she was viewed as being too politically toxic to be hired by the key decision-makers within the industry.

Generations of PLP Parliamentarians past and present have experienced the same outcome. But there is also something else going on that brings us back to my central narrative about the growing centrality of technology and the growing challenge it poses to the Bermudian economy.

Over the past few years many companies within our off shore sector have been utilising outsourcing; or as some would characterise it, technological outsourcing, even to the extent of contracting tasks such as actuarial, accounting and legal work to places like India and beyond as was indicated earlier in my presentation.

As explained by a former CEO of one of Bermuda’s top reinsurers, why spend a quarter of a million per annum to base somebody in Bermuda to perform those highly specialised and valued tasks, when those services can be had for a fifth of the price somewhere else?

Consider the above outsourcing 1.0, which I contend characterises the last decade.

Remarkably, though, outsourcing 2.0 is rapidly taking shape. Outsourcing 2.0 means that it will no longer be necessary to outsource to India for example at all. In fact, the need for any human agency will be made redundant as technological outsourcing 2.0 will result in those tasks being performed by algorithms accessed by way of smart software, located in the cloud as indicated during my opening remarks.

The implications of that trend are there for all to see as we transition to a world that will witness the disappearance of more and more once secure and well-paid white collar professions.

And what of the scores of young Bermudians right now who are attending top-flight universities with the aim of taking their place in the corporate world over the next couple of years and of those who will follow them?

There is no halting these structural trends.

The technological challenges will also be compounded by other structural shifts in our economy with respect to the rise of alternative risk capital vehicles such as insurance-linked securities.

ILS has established a significant market presence over the past five years. This has largely been driven by the growth of catastrophe bonds and other exotic risk vehicles.

And Bermuda has become an important global hub of this phenomenon. The problem is that while highly profitable, the companies that are in the business of providing Insurance Linked Securities will never create the relatively high levels of employment that came with the more traditional reinsurers such as the XLs and ACEs during the period of heady growth, beginning just over a quarter century ago and which reached its apex in the period after 9/11 and Hurricane Katrina.

Arthur Wightman, an executive with Price Waterhouse Coopers, summed up the current mood within the reinsurance and insurance industry — both locally and abroad — by noting in a recent Royal Gazette article (June 21), in which he referenced a recent published report on the industry, that this sector of the global economy is facing far more disruption and creative destruction than just about any other, in the financial services sector.

He added: “... 56 per cent of insurance CEOs said the new money flooding into the market from alternative sources posed a threat to their prospects.”

He further added that, “The industry is at a pivotal juncture as it grapples with changing customer behaviour, new technologies and new distribution and business models,” said the PWC report. Perhaps ominously, the financial services sector worldwide is also the biggest adopters of advanced technologically disruptive innovations.

Neither the PLP nor I as Shadow Minister of Human Affairs with responsibility for Workforce Development have been needlessly critical of the Minister with responsibility for the Workforce Development Department; or the work being performed by the dedicated men and women of the department.

Why would we be? The creation and evolution of our current workforce development model occurred under the Progressive Labour Party government and we commend the government for moving the agenda forward in this regard.

From the aforementioned Arnold report; to the Columbia University study and final report compiled by Professor Ronald Mincy, to our advocacy on behalf of technical and other forms of training, we consistently have demonstrated our commitment to not only workforce development but more importantly to the development of Bermuda’s people and their hopes and aspirations.

That baton was passed to the new government in 2012.

In terms of what has been accomplished since 2012, with respect to the Workforce Development Department we are pleased to see that the objective that was put in place by the former PLP government to convert and renovate the old Magistrates’ Court building to serve as the departments new headquarters was realised. Secondly, that the plans to revamp the organisational structure of the department — as also mandated by the previous government, has been successfully implemented.

In addition, we have repeatedly commended the government on the establishment of the online Bermuda Job Board. We believe that it was a critically necessary and overdue idea and one that the current government deserves all the credit for.

Finally, the National Training Plan (part 1); the expansion of various training programmes; and the news that the review of the career development policies and procedures within the Career Development section of the department has been completed and its recommendations approved, as announced by the Minister of Home Affairs recently, is welcomed news.

As the contours of these challenges emerge, however, we must ask ourselves whether at a strategic level we are doing enough to prepare Bermuda for the game-changing forces these aforementioned trends will increasingly unleash?

And moreover, are we developing a workforce development model for 2025; or one more suited or reflective of the late 20th Century in light of the growing evidence before us.

We know on this side of the political divide that this is not a PLP issue or an OBA issue.

It is, however, an issue of critical national importance.

The type of “hour glass” labour market, which is evolving and driven as it is by technological disruption and other factors; is one that will likely see an entrenched group of highly paid executives and specialists at the very top of the metaphorical hour glass; but with a squeezed middle that represents the sharply reduced number of middle-income level jobs that were once found in abundance in most Western societies.

At the bottom of that hour glass will likely consist of a growing number of low-paying, largely service-level jobs for which growing numbers of persons may not even be able to earn a livable wage.

They are literally the working poor and their numbers are increasing and Bermuda in this regard is not immune as income inequality is growing in Bermuda.

We see the contours of these types of labour markets taking shape in the US and other countries. Is that the future that the finance minister sees in his proverbial crystal ball for Bermuda?

Will we see a Bermuda in the mid- to long-term characterised by persistent structural unemployment, underemployment and low wages for the many?

Will the growth of emigration to the UK and beyond for those who can no longer afford to live in Bermuda or for those who simply cannot find work here, be the new normal?

Certainly in Bermuda there is a palpable feeling that our once vaunted middle class, particularly in the black community is steadily eroding along with the social safety net that afforded some relief to those in need due to persistent unemployment or other challenges.

It would be too easy after viewing the best available data and informed opinions on this issue to feel overwhelmed by the challenge before us as a country.

And it would be far too easy to allow pessimism to cloud our judgement and say that this is mountain is too complex; to daunting and too rough to climb.

But climb we must.

• Rolfe Commissiong is the Progressive Labour Party MP for Pembroke South East (Constituency 21) and the Shadow Minister of Human Affairs. This is the first in a four-part series that encapsulates a paper on the impact of technological change that was presented before the House of Assembly. At the invitation of Sandys Rotary Club, he will be appearing at 7.30pm today at Henry VIII restaurant to lead a discussion entitled “2025 Revisited”