COMMITTEE RECEIVES TESTIMONY REGARDING THE TERRITORY’S ECONOMIC AND WORKFORCE CONDITIONS 

ST. CROIX, VI – The Committee on Economic Development and Agriculture, led by Senator Hubert L. Frederick met in the Fritz E. Lawaetz Legislative Conference Room.  Lawmakers received testimony from the Virgin Islands Department of Labor, Bureau of Economic Research, and Economic Development Authority regarding the territory's current workforce trends, business and economic development, and economic diversification.  

Senators first heard testimony from Dr. Gary A. Molloy, Commissioner of the Virgin Islands Department of Labor, and Nesha D. Christian-Hendrickson, Assistant Commissioner, regarding the territory's employment conditions and workforce trends. Molloy reported that preliminary August 2026 estimates indicate a labor force of 38,214 individuals, with 36,572 employed and 1,642 unemployed, resulting in an unemployment rate of 4.3 percent. Nonfarm payroll jobs stood at 31,933 in August 2026, marking a 4.0 percent decrease compared to August 2025.Highlighting district-level differences, Molloy noted that the August 2026 unemployment rate on St. Croix was 5.5 percent, compared to 3.5 percent for the combined St. Thomas–St. John district.  

To address workforce readiness, VIDOL is utilizing the Virgin Islands Electronic Workforce System and partnering with approved training providers to offer instruction in high-demand fields such as healthcare, construction, HVAC, plumbing, and automotive repair. The Department is also advancing a workforce agenda focused on key structural improvements. The agency plans to establish quarterly district reporting to track employment, job postings, candidate supply, and training outcomes. The Department is also asking major public and private project sponsors to submit advance staffing plans that detail anticipated hiring dates, required occupations, and job locations.  Additionally, the Department will strengthen cross-agency cooperation on support service and improve school-to-work transitions for young Virgin Islanders. 

Lawmakers then testimony from Dr. Haldane Davies, Director of the Bureau of Economic Research, and Bernesha Liburd, Senior Policy Advisor, regarding the territory's current economic conditions and projected outlook for 2027. Davies characterized the Virgin Islands as operating within a dual economy, marked by severe public sector liquidity constraints alongside strong federal spending and private sector growth. While the territory closed out the fiscal year with an estimated $59 million deficit, gross revenues are projected to increase to $870 million in 2027, supported by a proposed $1.63 billion budget aimed at long-term fiscal stabilization. 

Key economic indicators show that the territory's GDP stands at approximately $5.4 billion, with territorial debt reduced from $2.2 billion in 2018 to $1.6 billion in 2025. Inflation remains a significant hurdle; it continues to exceed the U.S. national average, driven by notable price increases in housing, food, and transportation. In tourism, visitor arrivals reached 2.2 million through August 2026, with hotel room tax collections rising to $41.7 million compared to $35.4 million in 2025. Building permits totalled $117 million in August 2026, with $104 million concentrated in the St. Thomas–St. John district and $12.5 million on St. Croix. 

To achieve long-term economic resilience, Davies recommended modernizing revenue collection, streamlining semiautonomous boards, expanding the blue economy, and modernizing the Virgin Islands Virtual Information System into a cloud-based framework. Additionally, based on visitor exit surveys, he urged the territory to reform its taxi system by regularizing operators, enforcing digital payment options, and allowing rideshare services for small groups. Davies concluded by emphasizing the need to align workforce training with youth career interests in healthcare, technology, and engineering. 

Dwayne Benjamin, Assistant Chief Executive Officer of the Virgin Islands Economic Development Authority gave testimony providing an operational status update on the umbrella organization and its four subsidiary entities. Benjamin expressed that the Authority operates under a single governing board and manages 44 budgeted full-time positions, alongside overseeing more than $105 million in federal grants in addition to its annual $6.6 million government appropriation. Maintaining a strong record of financial transparency, the EDA recently completed its Fiscal Year 2024 independent audit, securing its 15th consecutive unmodified audit opinion. 

Benjamin detailed key programmatic updates across the Authority's divisions. The Economic Development Bank continues to administer the State Small Business Credit Initiative Program, having deployed approximately $16.7 million in capital support to leverage $29.4 million in project financing across 28 small businesses, while also awaiting appropriated funds to restart the VI Slice First-Time Homeownership Program. Under the Economic Development Commission, tax incentive beneficiaries grew by 45.9 percent from 74 in 2021 to 108 in 2026, directly supporting approximately 3,000 local jobs and generating over $309 million in economic impact for calendar year 2024 based on partial reporting. 

Additionally, the Enterprise Zone Commission is advancing the development of agro-processing and food technology commercial kitchens at the former Marcelli School facility on St. Thomas and the Padilla Building on St. Croix, with equipment scheduled for delivery in October 2026. Finally, the Economic Development Park corporation reported 100 percent occupancy across the Virgin Islands Industrial Park on St. Thomas, the William D. Roebuck Industrial Park on St. Croix, and the Fleming Building in Frederiksted, while actively pursuing capital improvements, microgrid development, and park expansion projects to accommodate strong demand from assembly and manufacturing businesses. 

Senators present at today’s Committee hearing included Hubert L. Frederick, Marvin A. Blyden, Angel L. Bolques Jr., Alma Francis-Heyliger, Novelle E. Francis Jr., Marise C. James, Franklin D. Johnson, and Clifford A. Joseph.  

The Division of Public Affairs is committed to providing the community with accurate information on legislative proceedings and other events at the Legislature of the Virgin Islands. Visit legvi.org.  

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