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Christopher Sabatini Headshot

Global Migration and Business: Help Wanted but Don't Ask Us for Any

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The occasional explosion of violence between native born-French and Northern African immigrants or the recent riots between African immigrants and Italian citizens in Calabria, Italy remind us that immigration is not just a U.S. phenomenon.  (The violence also reminds us that for all the ugliness of U.S. public opinion or U.S. policy toward immigrants, the U.S.'s anti-immigrant backlash is relatively tame in comparison.)   The pull of labor markets and the desire to seek a better life remains strong across the world.

The problem is that the pull for jobs and the policy to facilitate immigration and integration do not always match.  Perhaps more problematic is that the principal engine for workers to cross borders (the businesses that employ them) remain largely unwilling to confront the contradiction between need for and receptiveness to immigrants.  While they may attract them and admit they benefit from them, businesses are too often unwilling to defend immigrants and immigration.

Who Needs Immigrants?

Turns out most of us do.

According to the Economist Intelligence Unit's (EIU) Global Migration Barometer,1 of the top ten countries ranked by their attractiveness and accessibility for migrants all but two are in English speaking (Australia, Canada, the U.S., the U.K., and New Zealand) or in Northern Europe (Sweden, Norway, Belgium). The outliers are Singapore and Hong Kong, both small economies that have actively sought to bolster their shallow workforce with the skills of immigrant workers.

The barometer is a composite of two indices. The first measures the attractiveness of a country to migrants, looking at economic growth, cultural-historical proximity, and quality-of-life factors such as the quality of public services, access to financial and credit services, civil liberties, and ease of remitting money. The second index measures accessibility for migrants--essentially the countries marked by more immigration-favorable policies, including government policy toward migration, ease in hiring immigrants, and programs to integrate immigrants.

The countries included in the top 10 make sense at one level. Most of them are developed countries that combine higher rates of growth with generous social safety net programs that promise a cushion to immigrants as they adjust. Countries farther down the list----Germany (17), France (18), Italy (20), Austria (21), and Japan (28)--are curious exceptions. In these cases, factors such as GDP growth and quality of life measures are relatively on par with the upper 10. Where they diverge largely is in their accessibility for migrants. On this single scale, Germany ranks 24, Italy 29, Austria 39, France 43, and Japan a low-scoring 53--all out of 61.

The lack of accessibility for immigrants in countries like Germany, Italy, France and Japan would be logical if it matched those economies' need for immigrants. To measure this, the EIU looked at the replacement rate of the labor markets, the old-age dependency ratio, the natural increase of workers entering the labor market, and employment ratio, pension liabilities, and productivity. Yet here, Japan tops the list, followed by Italy. Lower down are France (7), Austria (9), and Germany (15).

In other words, fifteen of the top countries that most need immigrants to replenish an aging labor population and state coffers for social outlays are some of the least welcoming in their immigration laws.

This wouldn't matter if there were an active private sector--the primary beneficiary of immigrant labor--leading the charge to correct this imbalance. But there isn't.

Who Hires Them?

A second study in 2009 by the EIU surveyed the attitudes of 501 business leaders globally toward immigration. The vast majority of the executives (73 percent) report that they employ immigrant or foreign-born workers, and an even higher number (76 percent) agreed that hiring foreign workers was important to fill specific staffing needs.

Most of those were skilled rather than unskilled workers, due in large part to the global nature of the businesses included in the EIU study. Fifty-seven percent of the companies have global sales of more than $500 million, with 28 percent of all the countries based in North America, 28 percent in the Asia-Pacific region, 27 percent in Europe, and 19 percent in Latin America, the Middle East, or Africa. It's no stretch to assume that if you included more local, service industries in the mix you would get a far higher number of companies employing low-skilled immigrants.

But would they be any more courageous in standing up for immigration and addressing hurdles to hiring and integrating foreign workers? We can only hope so, because the businesses in the EIU survey demonstrate a sad lack of backbone on what they themselves admit is a crucial element in their ability to compete.

In the survey, 88 percent of the international business executives surveyed said that there are one or more challenges to hiring foreign workers. In fact, 40 percent said that it is difficult to hire workers for low-skilled jobs. Most cited the limitations on visas and the complications and costs of the system. Sadly, though, only a minority, 15 percent, is willing to advocate before their government for more open immigration policies and laws. And only 10 percent is currently engaged in promoting more liberal immigration laws in the name of their company.

A higher number of businesses, however, commit to helping their foreign-born employees integrate into their newfound places of residence. Whether it's funding housing (48 percent), providing orientation and materials to foreign workers (30 percent), or helping them adjust culturally (21 percent), some businesses appear willing to help ease the process of integration. This is no small step. As we are seeing in violent reactions against immigrants, whether in France, Italy, Germany, or the United States, the immigrant workforce and their families remain a target of discrimination and even violence, largely because they are seen as being distinct, separate, unintegrated, and a drain on public resources. The efforts of the private sector can go a long way toward alleviating that exclusion and dependence on public services.

Again, though, remember the profile of these employers: largely multilateral businesses. Most of their employees are skilled laborers, not the underskilled (and often undocumented) immigrants who have been the target of recent violence or racist outrage. Who speaks for them? Who will help them integrate if even the most international companies balk at helping their skilled employees and only half assist them in adjusting to their new homes?

The topic affects more than the productivity and competitiveness of businesses. Immigration determines the capacity of countries themselves to survive in the global economy. For the countries mentioned above--Japan, Germany, and Italy--there is a dangerous disjuncture between the immigration policies of their governments and the long-term economic and public need for a new labor force. Sure, arguments can be made about the cultural homogeneity and the closed sense of nationhood that dominate these countries and challenge the integration of outsiders. But in a globalized economy, such notions are not just anachronistic; they run against economic and even national logic.

Unfortunately, as the surveys above demonstrate, businesses seem unwilling to put these hoary myths of nationhood to rest. But if businesses won't, who will? At first, the private sector will be the one to suffer. Eventually, though, business and production will move, enjoying the benefits of a global economy that has made borders more porous and eased transportation and communication costs.

In the end, if national businesses are unwilling to assume the responsibility of defending their need for labor and the rights of their employees, companies from other countries will, or these businesses will move on, leaving behind their home country in search of better labor markets. And when they do, traditional notions of cultural homogeneity and nationalism tied to race will seem not just quaint but economically catastrophic.