Attracting and Retaining Talent During and After the Global Recession

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Attracting and Retaining Talent During and After
the Global Recession
Demetrios G. Papademetriou President Migration
Policy Institute Economics and Labour Market
Integration DomainAnnual Symposium Saint Marys
University Halifax October 8-9, 2009
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The Challenge of Complex Global Interdependence
and the Place of Migration in It

• International migration is already one of this
  centurys unavoidable issues.
• Few by-products of globalization seem to be
  pricklier for high income societies than the
  movement of people.
• Both immigrant origin and destination societies
  have become more conflicted about migration. Yet,
  the economic importance of migration is growing
  for both of them and, notwithstanding the current
  recession, will only grow stronger in the next
  two decades.
• More countries are now significant players in the
  international migration system than at any time
  in history.
• Almost all high income and most fast-growing
  middle income countries are already, or are fast
  becoming, major immigration actors.
• The statement above notwithstanding, twenty or so
  countries, including some of the most developed
  ones (UK, US, Germany, Canada) provide the vast
  majority of migrants in the world.
• Mobility vs. Migration increasingly competing
  core concepts in the movement of people in the
  future.

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Part I------The recession is dead! Long live
the recession! (and especially its consequences)
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Until recently, the world economic outlook seemed
mostly bleak
Real gross domestic product (GDP) growth, 2009
(est.)
EU -4.2
North America -4.2
BRICs 1.4
World GDP is expected to decline by 1.1 in 2009
Notes North America includes Canada, Mexico,
and the United States. BRICs include Brazil,
Russia, India, and China.
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In 2010, the economic outlook will likely
brighten in much of the world
Real gross domestic product (GDP) growth, 2010
(est.)
EU 0.3
North America 2.3
BRICs 5.1
World GDP is expected to grow by 3.1 in 2010
Notes North America includes Canada, Mexico,
and the United States. BRICs include Brazil,
Russia, India, and China.
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World trade is expected to decline by 12 in 2009
the first decline since 1982 and only the
second time since World War II
World export volume, percent change (actual and
predicted)
Source International Monetary Fund, World
Economic Outlook (Washington, DC IMF, October
2009).
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The IMF has been expecting a long and deep
recession, and a slow recovery (although it has
revised its estimates repeatedly)
Note The top 10 countries with the largest
immigrant stock in 2005 according to the UN US,
Russia, Germany, France, Saudi Arabia, Canada,
India, UK, Spain, and Australia, in that order.
Low income countries are according to World Bank
classification. BRICS include Brazil, Russia,
India, China, and South Africa.
Source International Monetary Fund, World
Economic Outlook, October2009.
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Part II------The United States, the worlds
largest economy, has been severely impacted by
the economic crisis but so have most of the
other rich countries
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The current US recession is already longer and
more severe than any other in recent history
Unemployment (change in the unemployment rate)
Industrial Production (relative to the first
month of the recession)
Source Council on Foreign Relations, National
Bureau of Economic Research, Federal Reserve
Board, Bureau of Labor Statistics.
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The unemployment rate has reached the highest
point since 1983
Note Unemployment rate not seasonally adjusted.
Source BLS, Current Population Survey, Jan 1948
to August 2009.
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And official unemployment figures may mask the
true severity of the jobs crisis.
Moreover, the average number of weeks unemployed
is the highest on record 27 have been out of
work for more than 6 months!
Source BLS, Current Population Survey, January
1994 to September 2009.
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Jobs will likely remain scarce even after a
recovery begins
Source Bureau of Labor Statistics, National
Bureau of Economic Research.
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Immigrants demographic and labor force
characteristics make them more vulnerable to job
loss during recessions.
They are also more likely to be less educated
Immigrant workers are on average younger than
natives
And tend to work in different sectors than
natives (Distribution of native- and
foreign-born in leading industries.)
A large share of immigrants are recent entrants
to the US labor market. (Year of immigration of
the foreign born.)
Foreign born from Mexico and Central America
Foreign born
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Unemployment is also rising in other major
immigration countries
Source International Monetary Fund and OECD,
Joint Statistics, Oct. 2009.
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Part III------What does all this mean for
competitiveness and immigration, and particularly
highly-skilled immigration?
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Things that the Recession Has Not/Will Not Change

• Skill and locational mismatches continue to be
  significant and rising.
• Concerns about worker shortfalls, both actual and
  impending, continue to grow.
• Educational and workforce-preparation systems in
  most economically better-off countries continue
  to produce not enough of the workers competitive
  economies require.
• Fertility rates for many high-income countries
  continue to be low and very low.
• The aging of the Baby Boom generation continues
  to create difficult-to-deal-with demographic and
  labor force predicaments.

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Recession or not, the Underpinnings of Economic
Competitiveness Remain the Same

• Knowledge-intensive jobs continue to underpin
  economic growth and competitiveness, and no
  country can fill all these jobs from the domestic
  labor pool, even with sharply refocused training
  and retraining efforts.
• Pre-, during-, and post-recession, better-skilled
  immigrants are always seen as the valued economic
  assets they typically are.
• Post-recession, the hunt for talented foreigners
  will intensify and those countries that have not
  lost ground in terms of openness to foreigners
  during the recession are likely to come out
  ahead.
• Beggar-thy-neighbor labor-market policies that
  seek to protect the jobs of domestic workers
  above all else (what The Economist calls people
  protectionism) will prove to be shortsighted
  when it comes to the talent and competiveness
  game.

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Key Ingredients for Long-Term Competitiveness

• Lest we forget, however, long-term
  competitiveness rests primarily on
• The choices and investments public and private
  sector policymakers and individuals make
  everyday.
• Social support systems that put work front and
  center
• Social and cultural norms that value and reward
  lifetime learning
• Social institutions (such as schools at all
  levels, worker organizations, civil society) that
  adapt to constantly shifting economic
  environments without losing sight of their
  principal missions
• Government policies that encourage and reward the
  private sectors socially responsible actions
• Individuals who constantly invest in themselves
  and their future.

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And After the Recession

• Values and social responsibility will still
  define smart governments behavior
• Adhering to international obligations will not be
  any less important
• Economic logic will not have been turned on its
  head
• Policies that attract the most talented and those
  with scarce skills will be as relevant as they
  were during the pre-recession period of strong
  economic growth
• And the rate at which the developed world is
  aging will only be increasing while more and more
  of the developing worlds youth will be coming of
  age.

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And The Most Talented Immigrants Decision-making
Calculus Will Be, Again, As It Always Is
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And Governments and Societies that Want to Get
the Most Out of Immigration in the Post-Recession
Period Will Do So on the Basis Of

• How sophisticated have they become in integrating
  immigration policy into their social and economic
  policy priorities
• How systematically they have learned to use
  evidence about successful immigrant integration
  in setting their immigration policies
• How smartly and deeply they have invested in the
  social, cultural, and economic integration of
  their foreign-born populations and their
  offspring, and how fruitful these investments
  have been
• How successful they have been in controlling the
  intolerance and political reaction toward
  immigrants that the economic downturn is sure to
  have exacerbated.

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Part IV-----Looking Ahead A Shifting Policy
Landscape
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Supply and Demand More Rather Than Less
Migration is Likely in the Near-to-Mid-Term

• The immigrant pipeline will remain robust for the
  next two decades, but not necessarily the supply
  of skilled migrants.
• Once economic growth returns, the demand for
  immigrants across the skills continuum will once
  more grow substantially because of
• Demographics The one-two punch of the birth
  dearth and the increasing share of the elderly
  population (dependency ratios).
• Economics Increasing skill mismatches and worker
  shortfalls.
• Humanitarian Impulses Rights-based openings to
  migration will continue to build stronger
  immigration streams (families and asylum/refugee
  resettlement needs).

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Supply and Demand (cont.)

• A number of still relatively small migration
  players are likely to grow in importance, while
  China, India and a number of Southeast Asian
  countries could become massive players, both as
  senders and receivers of immigrants within and
  beyond their region.
• Policies that allow for temporary-to-permanent
  status transitions will proliferate as a
  selection mechanism for permanent immigrants as
  will regulated temporary (circular?) routes to
  recruit needed foreign workers all along the
  skills continuum.
• Pressures to admit better skilled foreigners
  outrightly as permanent immigrants will also
  increase, particularly when the world economy
  rebounds and global competition for talented
  foreigners intensifies.

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AN INFLECTION POINT????The Counter-Scenario
Illegality, Terrorism, and Deep Recession Take
their Toll

• Applying greater resources to border and interior
  controls will not suffice to stem unauthorized
  migration.
• It is difficult to anticipate the effect of
  terrorism on migration with certainty but it
  appears now that absent large scale and
  spectacular acts of terrorism, migration will
  continue unabated.
• Under a scenario of sharply fewer opportunities
  for legal migration for the next 3 to 5 years
  (due to a recession that has spread faster, has
  gone deeper, and whose employment effects for
  many countries will last longer than most had
  anticipated), a possible migration outcome for
  the next decade is one of (a) greater illegality
  and more draconian efforts to defeat it, (b)
  sharper popular reactions to all immigration and
  (c) both less immigration and different forms of
  immigration.
• The possible antidotes to all this? (a) Smart
  immigrant selection policies that are embedded in
  the receiving countries economic growth and
  competitiveness policies (b) wise investments on
  integration policies that help prepare all of a
  societys marginalized populations for active and
  fulfilling work lives, (c) an ongoing commitment
  to legality and safety by gaining the deeper
  cooperation of countries of origin, and (d)
  pursuing development friendly immigration
  policies.

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Epilogue Toward More Sensible and Responsible
Policies

• People will continue to move for a variety of
  reasonsopportunity differentials being primus
  inter pares among them. The challenge and the
  opportunity is to manage the ensuing movement
  well.
• Rich countries cannot simply exhort people to
  stay at home without a serious commitment to a
  long-term and costly endeavor to improve
  conditions there.
• Sensible and responsible immigration and
  integration policy requires far greater
  across-the-board cooperation than is now the
  case.
• Across relevant governmental agencies and levels
  of government within a single state
• Across relevant portfolios across states and
• Between the governmental and non-governmental
  sectors within and across state actors.

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Demetrios G. Papademetriou President Migration
Policy Institute 1400 16th Street, Suite
300 Washington D.C. 20036 dpapademetriou_at_migratio
npolicy.org www.migrationpolicy.org www.migration
information.org