The International Mobility of Labour as a Development Strategy - Essay Example

The International Mobility of Labour as a Development Strategy in the 21st Century: A Critical Examination Introduction Immigration of labour,especially those with advanced skills, is becoming an inherent part of economic development policies and national technology development plans. Highly skilled labour with specialized skills and competencies are in short supply, and are being sourced globally from an international labour market. The internationalization of labour markets poses both challenges and opportunities for the formation of human capital at the national level. Based on the changing circumstances, several European and OECD (Organization for Economic Cooperation and Development) countries have formulated “new incentives, procedures, and legislations to make their participation in the international labour markets more gainful” (Mahroum, 2001: 27). The purpose of this paper is to critically examine the pros and cons of the international mobility of labour as a development strategy in the 21st century. The essay will review at least one journal article (by Mahroum, 2001: 27-44), and refer to a Case Study which explains the development experience of a particular country, with the help of economic data and examples. Discussion The increasing international mobility of highly skilled labour causes participating countries and regions to gain and lose important human capital stocks. Though countries may not be participating voluntarily, contemporary global reality is that the occurrence of labour mobility is rising steadily. This is especially true of European Union (EU) countries, on which restrictions on local labour from going abroad are not imposed. In a globalized labour market, increased or decreased migration on a national level is more due to the situation at the international level, rather than caused by changing work conditions at home in relation to pay or other incentives (Mahroum, 2001: 27). The migration of highly skilled workers has been associated with the global expansion of world trade and the international expansion of transnational companies. However, a major part of the movement has been attributed to shortages of certain expertise in local labour markets. Internationally trained physicians frequently elect to migrate to the United States because of the high regard they have for the U.S. in terms of technological development, the quality of its medical schools, its specialist training and its commitment to fundamental biomedical research. However, banking and finance professionals are attracted to certain global cities because of the concentration of appropriate jobs available along with the cultural and other factors being of a convivial nature for them. Migration of skilled information technology labour, particularly engineers have been largely attributed to shortages existing in this field for highly skilled labour. On the other hand, scientists may be motivated to relocate outside the country to fulfill personal aspirations and scientific curiosity (Mahroum, 2001: 28). Migrants as Development Agents in the Host Country There is a new conceptualizing, acknowledging a strong link between migration and development in the host country. The claims which form the basis for migration and development can be summarized in the statement that the flow of money, knowledge and universal ideas, termed as remittances, can have a positive impact on the development in the countries of emigration. (Faist, 2008: 21). The first claim is that financial remittances carry a huge potential for poverty reduction and local investment, especially since remittances are very often resistant to economic recessities. The amount of remittances transferred to developing countries passing through officially sanctioned channels such as banks or money transfer services, are believed to have risen sharply over recent years. Remittances are considered to be central in the new round of enthusiasm, more emphasis is placed on the transfer of human capital from North to South. This has resulted in a change in perceptions of costs and benefits, with a shift from the concept of “brain drain” in the 1970s to “brain gain” in the 1990s. The current trend is to find positive impacts from labour mobility (Findlay, 2003: 515). The second claim is that the concept of social remittances, the flow of ideas and practices which are “good” and universally acceptable in most countries such as human rights, gender equity and democracy, are beneficial to society. An example is that sometimes, diaspora made up of exiles, refugees and labour migrants are hailed as mediators in conflict resolution as in South Africa and Nigeria (Shain & Barth, 2003: 449). The third claim of beneficial impacts by labour mobility is the desirability of temporary labour migration, because of the concept that temporary migrants transmit a higher percentage of their income than do permanent immigrants. And the belief in the circulation of ideas and knowledge. The above three broad, optimistic claims are tied to migration control. In the long run, economic growth supported by financial knowdedge and social remittances will reduce “migration pressure” in the sending countries. Transnational networks and associations of migrants form the core of optimistic visions of nationality and international economic development policy establishment (Faist, 2008: 22). This is a new approach, in which positive attributes are given to migrants’ influencing development in the host country. Transnational migration was considered as a sign of development failure during most of the 1970s and the 1980s. It can be considered as a territorial or geographical exit caused by failure of the state or other institutions to deliver well-being and human security. However, “since the 1990s, international organizations led by the World Bank, non-governmental organizations and organizations for economic cooperation and development (OECD) and nation state governments have increasingly touted remittances as a solution to development” (Faist, 2008: 23). On the other hand, inequality is a factor that persists when there is mobility of labour. Global income distribution is affected at three levels: in the sending country, in the receiving country and in inequality between countries. Where immigration increased the receiving country’s labour supply, inequality rose sharply, where emigration reduced the sending country’s labour supply, inequality declined (UN, 2006: 23). The notion of development is used in the same way as different kinds of transnational communities. Village communities consider development as the improvement of the infrastructure and the provision of local collective benefits such as education and health. For business persons and their networks, development stands for opportunities for investment and optimal interest. In the case of epistemic communities it means the smooth and unimpeded flow of knowledge, and in the case of national communities a high degree of political autonomy, sometimes even involving the formation of an independent nation-state. The lowest common concept of development is a vague hope of progression and betterment for the parts of the world considered as underdeveloped. Not only for the developing countries, but also in the case of highly industrialized nations, the contributions of migrants to social insurance, welfare state provisions, closing of labour market gaps in the informal service economy, and the norms of democracy and human rights transported to the host country by selected groups of migants, play a significant part in development (Faist, 2008: 27). Europe and the Immigration of Highly Skilled Labour With a view to the country’s development, governments may play a positive or negative role in formulating incentives for highly skilled workers to stay or move abroad. Government’s positive role would be to provide incentives for foreign skills to flow in or remain in the country, by easing immigration and work permits restrictions, providing tax incentives, and promoting the country as an attractive working and living environment. In Europe, demographic change and skills shortage in the labour market are two major socio-economic trends that have been taken into consideration by policy makers. Older and smaller populations will impact on the availability of sufficient skilled workforces in Europen societies. The size of the population has stabilized as a whole, but the age of the population continues to grow older. Business and industrial leaders are facing major difficulties in finding persons with the right skills to fill vacant jobs, especially in strategic sectors such as Information Technology, Telecommunications and Health (Mahroum, 2001: 29). European Union governments have been changing immigration legislation to make it easier to attract highly skilled labour. Changes in legislation governing immigration to most European Union member states are increasingly allowing skilled immigration to occur in a legal and much facilitated form. These changes provide the EU with the flexibility necessary to cope with globalization, changing demographic needs, and pressing skills shortages. Changes in legislation have ranged from introducing new categories of visa and work permits to facilitating entry procedures. Member states of the European Union should be able to draw from a common pool of labour by introducing an EU work permit. An important tool is tax discounts provided for foreign nationals. If tax competition continues, it will become more lucrative for highly skilled European Union workers to work outside their home countries, and skilled workers will migrate to the most advantageous tax haven (Mahroun, 2001: 33-34). Case Study The number of developing countries supplying labour is increasing, and immigrant workers are claiming a large share of urban service jobs. Secondly, rapid industrialization in the oil exporting countries has generated a major new international labour flow. Third, labour import and export policies show that immigrants are increasingly being used as a commodity. Their services are vital, in several sectors, for economic development of the host country (Sassen, 1990: 43). Immigrants have a strong impact on concentrated regional labour markets. The service sector is labour intensive, but many services cannot be exported to countries with large reserves of cheap labour. In Arab oil exporting countries there was an acute labour shortage after 1970. Massive immigrations to these countries which started in the 1970s, continues till today. The country studies sponsored by the International Labour Office show that in 1975 the proportion of foreign workers in the labour force was 39 percent in Bahrain, almost 70 percent in Kuwait, 48 percent in Saudi Arabia, and 85 percent in the United Arab Emirates. Most of these workers came fom Arab nations and from India, Pakistan, Bangldesh, South Korea and the Philippines. The size of the foreign labour force has steadily increased in the Arab oil-exporting countries. Discrepancies between the official figures and estimates of the foreign population and foreign labour force can be found in all Arab oil exporting countries. Governments are concerned about this large foreign presence, and have imposed tighter controls, launched drives to apprehend illegals, and deported foreign workers who try to organize strikes (Sassen, 1990: 48). The continued need for foreign workers is well illustrated by the case of the United Arab Emirates, where severe restrictions for visas for foreigners occurred concurrently with the announcement of a huge industrial complex in Dubai, as a free zone where Arab and Asian workes need no visa or contracts. Besides construction, other areas employ large numbers of foreign workers, especially manufacturing, wholesale and retail trade and many services including government administration and education. 85% of all workers in construction were foreigners, as were more than 80% of workers in manufacturing, and 70% of those in wholesale and retail trades. Labour shortages are so pronounced in these countries, that foreiners claim a significant share of civil service jobs, one-third in Oman and almost 80% in Qatar. This major new labour flow generated by accelerated industrialization reflects the transformation in the oil exporting countries, with the world accumulation process (Sassen, 1990: 48-49). Conclusion This paper has highlighted the pros and cons of the international mobility of labour as a development strategy in the 21st century. The essay reviewed at least two journal articles (by Mahroum, 2001 and by Faist, 2008), and refered to a Case Study which explains the development experience of a particular country, with the help of economic data and examples. It was found that migrant networks and organizations are development agents, supporting growth, development and trade in the host country. They have largely beneficial impacts on the host country where they work (Faist, 2008: 21). To some extent economic inequality is caused in the sending country as well as in the receiving country. However, in principle inequality between the two countries should be reduced; this is because in international migration people move from relatively low wage countries to nations with higher wages, thereby reducing the real wage gaps between the home country and the host country (UN, 2006: 23). References Faist, Thomas. 2008. Migrants as trans-national development agents: an inquiry into the newest round of the migration-development nexus. Population, Space and Place, 14: 21-42. Findlay, A. 2003. Skilled transients: the invisible phenomenon? In R. Cohen. The Cambridge survey of world migration. Cambridge: Cambridge University Press, pp. 515-523. Mahroum, S. 2001. Europe and the immigration of highly skilled labour. International Migration, 39 (5), SI 1: 27-43. Sassen, S. 1990. The mobility of labour and capital. Cambridge: Cambridge University Press. Shain, Y. & Barth, A. 2003. Diasporas and international relations theory. International Organization, 57: 449-479. U.N. (The United Nations). 2006. The international mobility of talent and its impact on global development. New York: The United Nations Publications. Read More