High value migrants: talent mobility and international development
THE TRAVAILS AND VICISSITUDE OF THE INTERNATIONAL MIGRATION of poor people often make the headlines of the popular press. However, there is another side to the overall migration process that can be termed as the mobility of “high-value migrants”. This process is far less numerous, faces easier immigration rules in developed countries and can lead to a greater economic potential in the development of new technologies and the creation of business, as well as the international transfer of knowledge and best practices. The process can be recognized by the movement across national boundaries of technology experts, software and hardware developers, scientists, entrepreneurs, international managers, etc. In a joint project between the World Institute for Development Economics Research of the United Nations University (UNU-WIDER) in Helsinki, Finland, and the United Nations Economic Commission for Latin America and the Carribbean (UN-ECLAC) in Santiago, Chile, this process has been described as the international mobility of talent. The project has studied the nature, causes and consequences of such mobility for international development.
Talent–an individual’s inner capacity to develop ideas and concepts, some with high economic value–is a critical engine for growth and development. It is an area in which developing countries usually lag behind developed nations and where development gaps are more evident. The “human factor” is critical to the success or failure of many endeavours. Emerging economies, such as China, India, the Russian Federation and Poland and to a lesser extent some Latin American countries, are becoming an important source of talented people like engineers and technical experts, some of whom have doctorate degrees from top-level universities.
Part of the new talent in developing countries goes to live and work in developed countries, typically in the United States, the United Kingdom and other nations of the Organization for Economic Cooperation and Development. This creates a concern over the ensuing loss of scarce human capital that would be deployed for the development of the knowledge economy in home countries. However, talented individuals also return home after graduation or after years of work in the host country, often bringing with them new knowledge, technologies, capital and contacts that are all very useful for national development. The traditional concept of “brain drain” must therefore be re-examined in light of the increasing interdependence and mobility of people among countries in response to new opportunities (and risks) that are offered by globalization. This leads to a new emphasis on brain circulation.
Today we see various patterns of international mobility of talent and capital around the world. On the one hand, talent from developing countries is moving north and seeking better opportunities in economies where people are equipped with more capital, technologies and effective organizations. On the other hand, capital from the north pursues talent in the south, setting up plants in countries where talent is readily available and cheaper than in developed nations. In turn, south-south migration of capital and talent is another possibility that is gaining increasing force. In the early twenty-first century, the patterns of mobility of talent have to be studied along with the mobility of capital and technologies, as they usually go together.
Our research has identified several factors that affect the mobility of talent: international differences in earnings and development gaps; the role of job availability, agglomeration and capital in the demand for talent; the role of technology; linguistic compatibility, networks and sociocultural affinity; and the shortage of skills and immigration policies.
International differences in earnings. These differences often reflect development gaps across countries. For example, if a software developer in the Russian Federation makes an income that is just a fraction of what he or she can earn in the United States or the United Kingdom, we can expect this Russian expert to move to a country that will offer a higher salary. Generally, the international mobility of talent depends on the income differential between what can be earned abroad versus the earnings at home. International income per capita differentials across countries are substantial, and large net income differentials certainly prompt emigration to the higher-paying country. This leads us to make a connection between development gaps–the difference in living standards and productive potential among countries–and the direction of the flow of talented individuals. Poor countries are likely to experience an outflow of professionals and entrepreneurs, while middle-income countries can see an outflow of human capital if salaries and benefits are lower than in other countries and the prospects for career development are uncertain. In addition, the outflow of scarce human capital can, by itself, amplify the development gaps, as the departure of human capital and talent can be a negative factor for domestic economic growth, at least in the short run.
Jobs, capital and talent. A country that offers interesting economic opportunities and good living conditions will attract capital, workers and talent. The relation between capital and talent may go in various directions. In a world of international mobility, factors of production capital face several possibilities regarding the use of talent: hiring domestic talent for production and/or marketing; importing talent from foreign countries; relocating operations to low-wage countries to tap talent there; and outsourcing talent services in either foreign countries or the home market. Some configurations of mobility of capital and talent are possible.
Another feature of the use of talent is the existence of agglomeration and concentration effects. In general, talent is attracted by the availability of other skilled persons, as creative processes are rarely done in isolation. Technical experts, engineers and scientists may leave their native countries, not only for better pay abroad but also the allure of interacting with peers of international recognition, and to locate in areas where there are resources to do research and develop new technologies. In contrast, talented individuals in their home countries may find lack of recognition, poor career prospects, modest salaries and the absence of a critical mass of professional peers.
Technology and the demand for talent. The revolution of the information and communications technology (ICT) in the last two to three decades has spurred an increase in the demand for specialized talent. Engineers, programmers, scientists and other experts whose knowledge can be used in the development of software and hardware are especially valuable. When talent is imported, its supply comes from a few developing countries. In turn, the supply of technical talent from Latin or South America for some important markets like the United States is still small in contrast with the talent from Asia. Another point to be made is that ICT allows that services be rendered without a permanent physical presence of the provider; for instance, consultancy reports can be sent and interacted through the Internet, or accounting can be provided electronically.
Linguistic compatibility, networks and sociocultural affinity. High education, knowledge of more than one language and understanding of cultural differences among countries are some qualifications of talented migrants, which can facilitate their international mobility and make their adjustment to other countries and realities easier. Members of the international elite of talent are often educated abroad, belong to professional and alumni networks of prestigious universities, and have developed a dense network of contacts worldwide with well-placed individuals around the world.
Shortage of skilled professionals and favourable immigration policies. The shortage of certain skilled professionals in local labour markets, such as information technology experts, computer science specialists, engineers, nurses and doctors, is an important factor behind the increase in demand for talent in the world economy. Immigration policies in rich countries are much more favourable to international talent than unskilled migrants, thus facilitating the inflow of talent. Newly rich countries, such as Ireland, Singapore and Scotland, are also putting in place immigration policies and offering economic conditions favourable to the admission of migrants with higher education and special know-how, and also investors who bring capital and technology. Advanced countries, such as Australia, the United States, Canada, the United Kingdom and Germany, have created special visa programmes for ICT experts, nurses and doctors, scientists and graduate students, thus competing with developing countries in their efforts to attract or retain talented individuals.