The rise of remote work could put one of the government’s largest revenue streams – work permit fees – under pressure, according to economist Marla Dukharan.
In an interview with Cayman Independent, she explained that the high cost of living is reshaping the financial appeal to foreign workers of relocating to the Cayman Islands.
“The higher the cost of living and the lower the quality [of life], the easier it is to not decide to come or to decide to work remotely from wherever else they live, and that means that you put all of that revenue at risk,” she said.
According to figures in her recent report on population growth, work permit fees generated CI$138.9 million for government in 2024, up from $58.5m in 2011.
The document describes the fees as a central pillar of a fiscal “incentive loop” linking foreign labour to public revenue.
However, Cayman’s increasingly steep cost of living, combined with changes to the work permit fee system, may be creating conditions for foreign workers to stay put.
Among white-collar workers, in industries like financial services, Dukharan said that tendency has already begun.
She pointed to the example of finance professionals located in places like Canada, who live abroad while working for companies in Cayman, occasionally visiting for meetings.
“You will end up with a situation where the work permit fees will start to decline if the quality of life in Cayman is not sufficiently attractive for people to endure the cost of living in Cayman,” she said.
Taking on costs like private school fees – which, in Cayman, Dukharan said, nearly parallel the cost of university tuition – further disincentivise relocation.
For local employers as well, the cost-saving benefit is clear. By hiring abroad, businesses avoid taking on work permit fees and salaries that reflect Cayman’s higher cost of living.
“I would imagine that the average company in Cayman would be seriously evaluating whether or not those people who don’t need physical presence in Cayman can work remotely and not incur work permit fees,” Dukharan said.
‘The new normal’
For Caymanian employment minister Michael Myles the outlook is not all negative regarding remote work. He described the set-up as “the new normal”.
“Outsourcing is by no means a new concept,” he told Cayman Independent. “Companies globally have been utilising off-island talent and services for many years to maintain competitiveness.”
The rise of AI and automation, he added, has allowed businesses to become increasingly creative in streamlining operations, reducing staffing needs and cutting overhead costs.
“While outsourcing is often viewed with caution, it offers tangible benefits for businesses, such as operational flexibility, cost efficiencies and access to specialised global skill sets, which ultimately help keep local enterprises viable and growing,” Myles said.
“For Caymanians, this shifting landscape is an opportunity rather than just a challenge.
“The global remote workforce model works both ways – just as local companies look abroad, international firms are increasingly seeking qualified talent anywhere in the world.”
To ensure Caymanians thrive in the shifting workforce, Myles said the primary focus must be on upskilling and modernising.
By developing high-demand technical skills, he added, Caymanians can improve their standing in an increasingly digital landscape and secure remote work themselves from international companies.
Myles, like Dukharan, also recognised that certain jobs will continue to require a physical presence.
For workers in industries like tourism and the trades, this could provide a greater sense of security.
“Practical, hands-on professions are naturally insulated from remote outsourcing and remain vital to our physical infrastructure,” he said.
“The rise of remote work underscores the immense, lasting value of these careers, making investments in trade training a sustainable and highly lucrative path for Caymanians alongside digital and financial sectors.”
