LABOR MIGRATION, INTERNATIONAL

Migration for work is one of the major international migration streams. Although successful entry tends to generate international migration streams of dependents not seeking employment, and has other long-term demographic consequences, understanding such repercussions requires prior understanding of international labor migration per se.

Labor migration–as compared with admission of refugees and asylum seekers, and family reunification, which creates or reconstitutes families after one migrates–matches most directly the interests of immigrants with those of the receiving country. Indeed, the main form of international migration has been the "labor-" or work/skills-based one. It has been the dominant form of immigration to the United States in all but the most recent phase; it is the foundation and principal multiplier of the post—World War II migration to northern and western Europe; and it is the almost exclusive variant of the migration flows to the Gulf States since the 1970s, as well as to East Asian and certain South and Southeast Asian states since the 1980s.

Given the large differences in wages and opportunities between potential sending and receiving countries, labor migration streams are likely to remain very large. In the contemporary world, international migration tends to be strictly controlled by the receiving countries. Accordingly, permanent employment-based (also referred to here as "immigrant") visas issued on the ground that an employer seeks the recipient's skills are rather limited. The United States, Canada, Australia, New Zealand, and, in some ways, South Africa–the so-called traditional countries of immigration–have a history of offering permanent employment and skill-based visas as a major part of their immigration programs. The first four of these countries, as of the late 1990s, have accounted for roughly 300,000 such admissions annually–including both principals and their families. Few other states offer permanent immigration status up-front on the basis of skills, education, and/or fit with labor market needs.

On the other hand, temporary admissions of foreigners (also referred to here as "migrants") who either enter explicitly in order to work or gain a derivative right to do so have been growing rapidly. This is the primary means for gaining entry into most advanced industrial states; increasingly, it is also the means through which ever-larger proportions of permanent immigrants initially enter these states–particularly the United States but also key member-states of the European Union (EU) and Canada.

Most visas in this admission stream, whether permanent or temporary, are awarded to persons with education and skills. Admissions may also be based on a person's relevant experience for particular jobs, even in the absence of formal skills.

Most states follow a few more or less similar routes of selection and admission. They have mechanisms for admitting foreign workers for certain types of employment, both permanently and temporarily, and employ similar screening mechanisms for these admissions.

Skilled Migration: Converging Practices in Drawing on the Global Labor Pool

One component of the employment-or skill-based system of labor migration is temporary admission. This is gaining in popularity across states, with often-similar procedures being adopted. This increasing convergence is in large part the result of the reality of multilateral arrangements, such as those relating to trade-in-services, that are anchored on the principle of "national treatment" or reciprocity, as well as of demands among economic partners to codify reciprocal access for each other's nationals in the areas of business, trade, investment, or cultural exchanges. Many of these arrangements also include either explicit employment components (such as visas for about 70 professional occupations under the North American Free Trade Agreement) or allow employment that is "incidental" to the visa's primary purpose (such as when a student is allowed to work part-time during the school year and full-time when school is not in session, or when a cultural exchange visitor is allowed to teach or give lectures for a fee).

There is, however, another and more consequential reason for such convergence in practices. Competitive pressures in a globalized economy put a premium on cutting-edge technical skills and talent–wherever these may be found. With low trade barriers and with technology, like capital, recognizing neither borders nor nationality, individual initiative and talent may have become the most valuable global resource. As a result, the developed world's immigration systems are well on the way to guaranteeing access to those who have the desired attributes and are willing to put them to work for a firm–wherever that firm may be located.

Not all advanced industrial democracies draw on the global talent pool with the same intensity. It is clear, however, that the high-end immigration door is opening wider and by historical standards remarkably quickly. The EU member states, led by Germany and the United Kingdom, the latter an experienced user of highly skilled foreign nationals, are leading the way in selecting qualified workers from abroad.

This opening is likely to refuel two "old" political discourses. The first one focuses on the failure of the recipient country to adapt its own training and education systems to the requirements of the so-called new economy adequately enough to meet the needs of employers from within its own labor pool. The second discourse dwells on the effect (and propriety) of deeper and more systematic "helpings" by advanced industrial societies from the human capital pool of the developing world. With most EU member states, Japan, other advanced economies, and, increasingly, many advanced developing states poised to permit entry to highly qualified labor, the "brain drain" issue is likely to gain increasing political (and analytical) relevance in the years ahead.

Screening Foreigners Entering for Work Purposes

A state or its corporate citizens choose the foreign workers to be admitted in three principal ways. The first, emphasizing the protection of domestic workers, uses rigorous labor market tests. The second seeks to identify and rectify labor market shortages and skill/locational mismatches. The third stresses the long-term economic interests of the receiving society. In reality, of course, a combination of selection criteria is typically employed.

Most European systems emphasize domestic (and in the EU case, EU-wide) worker protection schemes–although an effort is underway to move away from that model. The United States places its primary focus on rectifying labor market shortages and mismatches–with an increasingly pronounced tendency toward simplifying the labor market tests it requires. Canada, Australia, and New Zealand have increasingly focused on long-term economic interests (what may be called, at least in their permanent systems, the "skills accretion" formula); they eschew most labor market tests.

The principal agent in each selection scheme varies accordingly. In most EU member states, the prospective employer plays an important role but is typically constrained by government predispositions to micromanage the process and deny the employer's petition. In the United States, the principal agent is almost always the prospective employer, both for the permanent and the temporary employment based systems. In Canada and Australia, the principal agent for the permanent system is the government, with the prospective employer playing a minor role in the process. Employers, however, play a larger and increasingly independent part in the fast-expanding temporary worker admissions system.

Domestic Worker Protection Schemes

Domestic worker protection schemes differ in whether the controls are pre-or post-entry. The former is the dominant variant throughout the world; the latter is a U.S. innovation dating from 1989.

Pre-entry controls. One way to select foreign workers is to test each admission application against the availability of the eligible pool of workers for a particular job opening at a particular place and time. Under this system, the petitioner (typically the prospective employer) must demonstrate to the government's satisfaction that no domestic or other eligible workers are available for the job in question and that the employment of the foreign national will not depress the wages of such workers in similar jobs. Both requirements have proved extremely vexing both on administrative and methodological grounds.

Because of the cost and complexity of the process, an emerging consensus questions the value and efficacy of case-by-case assessments. Moreover, the approach arguably focuses on the wrong goal. It views foreign workers as offering case-by-case relief for specific job vacancies, whereas in the twenty-first century's competitive environment firms often choose workers (domestic or foreign) because small differences in the quality and specificity of skills can lead to substantial differences in performance. This argues for selecting foreign workers on the basis of their mix of skills, experience, education, and other characteristics that maximize the probability both of immediate and long-term labor market and economic success.

Post-entry controls: attestations. Post-entry control systems expend most regulatory and enforcement energy on the terms and conditions of the foreign worker's employment. Unlike the pre-entry test, the post-entry one is entirely a U.S. innovation. In its various forms, the attestation mechanism is the principal example of this type of control.

An attestation–a legally binding set of employer declarations about the terms and conditions under which a foreign worker will be engaged–reduces up-front barriers to the entry of needed foreign workers but still seeks to protect domestic worker interests through subsequent auditing and enforcement of the terms of the attestation. (The terms are designed to protect domestic workers from employer reliance on foreign workers to affect a union dispute, reduce wages, or make working conditions worse.)

Attestations have a number of positive features. If well conceived and implemented, attestations give employers access to needed foreign workers without harming the interests of domestic workers. They give potentially affected parties an opportunity to challenge the matters to which an employer attests. They are responsive to changing labor market conditions. They require minimal hands-on engagement by the government in an area where both data and procedures are weakest. And they can be an inducement to cooperative labor-management relations in recruitment.

Attestations, as practiced in the early twenty-first century, however, also have a number of shortcomings. Some of these are similar to the problems with the pre-entry control process. For example, the government is typically ill-equipped to determine the appropriate wage for any particular foreign worker. Furthermore, some of the documentation requirements of an attestation appear to be quite burdensome for employers and require release of what they consider proprietary information on wages. Attestations could potentially become pawns in labor—management disputes, subject to frivolous challenge by worker representatives. And the system is open to abuse by unscrupulous employers.

The Points Test

If the two main selection methods identified above are flawed–the first mostly in concept, the second in execution–what might be an alternative? Some states rely systematically on a points test for selecting large pluralities of their permanent "labor" immigrants. (New Zealand's proportion stands at three-fifths of total immigration.) Only those foreign workers whose specified personal and quantifiable attributes add up to a pre-agreed "pass mark" are allowed to immigrate permanently. (Among the characteristics currently receiving the highest point totals are education, age [comparative youthfulness], language and communication skills, and experience in a professional field.) Variants of the points system are practiced in Canada, Australia, and New Zealand. Germany has shown interest in the system.

A points system has several advantages over other selection mechanisms, at least when it is relied upon selectively and in conjunction with mechanisms that allow firms to choose directly some of the foreign workers they need. It inspires confidence as a policy instrument that applies universal, and ostensibly "hard" (i.e., quantitative and objective), selection criteria to economic-stream immigrants. Hence, it is less susceptible to the criticisms associated with the case-by-case system's "gamesmanship" between employers and bureaucrats. It can reassure key segments of the receiving society that the selection criteria for economic-stream immigrants conform to the state's economic interests. (This makes immigration politically more defensible than the alternatives discussed earlier.) And the criteria included can be altered or reweighted, or the pass mark adjusted, to respond quickly to shifting economic priorities.

A points-like system can thus shift the focus of permanent economic-stream immigration from an almost exclusive emphasis on case-by-case determination of specific job vacancies to one that takes into greater account broad economic interests. Properly conceived and implemented, and accompanied by opportunities for firms to select key workers on their own, a points-like system asks the government to do what it can be fairly good at (i.e., gauging the broad direction and needs of the economy over an intermediate-to long-range time horizon) rather than forcing it to do what it is least good at (i.e., case-by-case job matching).

Other Labor Migration Schemes

This article's focus so far has been on the formal, and individualized, selection schemes practiced most diligently by advanced industrial societies. However, the largest share of labor migration occurs through the following routes: (a) outside of formal controls;(b) through seasonal and otherwise short-term work contracts; (c) through a variety of training and similar schemes; (d) through trans-border work schemes; and (e) finally, through contracts that involve large numbers of workers, most typically tied to a particular construction or other major project.

The first form includes not only illegal migration, but also forms of migration that in many ways both predate and bypass attempts at formal regulation. Much intra-Africa migration, for instance, fits that latter characterization, as is much of the seasonal migration discussed immediately below. Both forms together amount to a total of several million persons per year.

Formal seasonal, other short-term, and industry-specific labor migration is also significant in numbers yet its size is difficult to estimate. Suffice it to say that few nationals of advanced industrial societies pick their own fruits and vegetables, tend to their agricultural holdings, staff seasonal or tourist related activities, or perform domestic and other forms of menial, difficult, and poorly-compensated work. These jobs have become the domain of foreign workers throughout the developed and, increasingly, the developing world. The workers who staff these jobs number in the low millions–probably between 2 and 3 million–and they hold a variety of legal statuses (the dominant one being an illegal status).

Training and similar schemes are notable in such countries as Japan, Germany, the U.S., and other countries that rely on them rather systematically. The numbers involved are in the lower hundreds of thousands. Such schemes are typically thinly disguised efforts to circumvent a government's prohibition of particular forms of entry, most typically directed against the importation of low-skilled workers. In most of these instances, government agencies effectively collude with employers to admit such prescribed persons.

Trans-border work schemes are typically found in neighboring countries. In their most formal expression, such schemes explicitly or implicitly allow limited employment and take the form of bilateral arrangements that often predate the strict regulation of migration. The U.S. "border-crosser" scheme has its roots in practices that go back to the early twentieth century; several hundred thousand people have a right to participate in that scheme but not all do. Germany developed similar arrangements in the 1990s with neighbors to its East, as have some other European states, more recently Italy and Greece. The total number of these additional schemes, however, generates tens of thousands of work visas.

The final form of labor migration, contract labor schemes, saw their heyday in the 1970s and 1980s. At that time, hundreds of thousands of Middle Easterners (particularly Palestinians and Egyptians), as well as East-, Southeast-, and South-Asians found contract employment in often massive projects located mostly in the Gulf states. The number of such workers in that region has fluctuated but generally numbered in the neighborhood of 2 to 3 million in the 1970s and 1980s, but has shrunk to nearly half that much in the 1990s–with South Asians having replaced most other nationalities.

See also: Immigration, Benefits and Costs of; Immigration, Unauthorized; International Migration.

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Demetrios G. Papademetriou