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  • Did you know that 1 in 20 workers worldwide is a migrant?

  • The migrant experience, it's a powerful one.

  • In an environment where we're talking about global inclusive growth, this entire group

  • of people is being left behind and ignored.

  • A migrant worker is defined as someone who lives and works in a country where they don't

  • hold citizenship.

  • And some 67% of migrant workers reside in high-income countries.

  • That's nearly 114 million people.

  • So, what are the ways their presence bolsters an economy, and what are the challenges that

  • lie ahead?

  • The growing speed of economic globalization has created more migrant workers than ever

  • before.

  • As long as there's been history, people have been going overseas to work.

  • And it's connected with the economic cycles as well.

  • That's Sri Jegarajah.

  • He's a Singapore-based senior correspondent for CNBC and has covered international markets

  • for over 15 years.

  • Sri, it's really great to have you here.

  • It's my pleasure, Nessa.

  • There's a lot that we can unpack about migrant workers right, but we're focusing now on

  • their impact on the global economy.

  • And seeing that many are concentrated in wealthy countries, is it just the appeal of well-paying

  • jobs that's motivating them?

  • There are a number of push and pull factors.

  • What it comes down to is the dynamics of the international labor markets.

  • And it's exactly like that, it's exactly like a market.

  • You go where you get the best price for your unit of labor, whether you are skilled, unskilled

  • or semi-skilled worker.

  • That dictates the flow.

  • Then of course, globalization.

  • The increasingly interconnected world has just accelerated those trends.

  • The barriers to entry have come down in the workforce.

  • There are the demographics involved.

  • Fertility rates have been falling, low birth rates, higher ageing population, and that

  • depletes the available pool of labour, creates the dynamics for entrants into the economy.

  • But who are the biggest drivers of a migrant workforce?

  • In 2020, the top three sources for remittances, which is the money workers send home, were

  • the United States, United Arab Emirates and Saudi Arabia, all high-income countries.

  • In the same year, the top 5 recipient countries for remittances inflows were India, China,

  • Mexico, the Philippines and Egypt, all low to middle-income countries.

  • In fact, India has received the highest number of remittances since 2008.

  • The foreign exchange factor is a big driver in terms of the flow.

  • So if you take the Singapore example, many foreign workers, migrant workers who work

  • in the construction industry, in the shipbuilding industry, from Bangladesh and from India for

  • example, Sri Lanka too, come here because they can remit their salary in Singapore dollar

  • terms back to their families, which will inevitably mean more currency in their bank account,

  • better standard of living for their family.

  • Is it just the pay that's drawing them?

  • It's not necessarily a case of country A, which is lower to middle income, workers there

  • looking at country B, which is at a higher stage of economic development, better prospects,

  • higher exchange rate and thinking, I'll have a piece of that.

  • It is across different countries of different rates of economic development.

  • An example was the U.K. in the 80s.

  • There were many British construction workers who went to work in Germany, when the Berlin

  • Wall came down during the East-West reunification, because there were opportunities.

  • So that's an example of the higher-income country, not necessarily a developing country,

  • where the workforce and labor have shifted.

  • It's a broad global theme that manifests itself in different ways across the income

  • spectrum.

  • What are some of the commonalities of low-income countries who are providing these migrant

  • workers?

  • Countries like Indonesia, Bangladesh, like the Philippines, they're still trying to

  • move higher up the value chain.

  • They're at that stage of economic development where it's a lot of agriculture, a lot of

  • manufacturing.

  • And they have not yet fully developed a higher-value tech industry, for example.

  • So those workers, who may even want to transition, may not be able to do so because the infrastructure

  • isn't there, the upscaling isn't there and they are stuck.

  • And they see the prospects, with the skills that they have, are better in other countries

  • within Asia, Singapore, Malaysia for example.

  • And they gravitate there.

  • While there is no internationally accepted statistical definition of labour migration,

  • they are usually categorized by the sectors they work in.

  • And the challenges differ according to their skillset.

  • You have varying degrees of exclusion, varying degrees of injustice, when it comes to the

  • issues of basic pay, working conditions, living conditions, recourse to basic labor rights

  • and advice.

  • In fact, there are very strong laws that are put in place to protect and safeguard their

  • rights.

  • It's enforcing those laws that's the tricky part because that comes down to the companies

  • that employ them.

  • And typically, many of these companies, many of these contractors and subcontractors, it's

  • not really a huge priority for them.

  • According to Human Rights Watch, Qatar's two million migrant workers make up an estimated

  • 95% of the country's workforce.

  • The country has faced intense international scrutiny over its treatment of migrant workers16

  • since it won the 2010 bid to host the World Cup in 2022.

  • And many of them are in debt.

  • Pre-pandemic, that was a big, big problem.

  • Also, there is no basic insurance or health coverage for when these men are hurt in an

  • accident in the workplace.

  • The vulnerability of migrant workers was highlighted even further with the pandemic18, as borders

  • were closed and mobility was heavily restricted.

  • A lot of these men and women cannot go back because of the restrictions in their own country,

  • and have to stay here and have to work because of the economic desperation in their own country.

  • The situation is quite different for migrant workers who still had their jobs in their

  • host country.

  • For example, at one point in December 2020, almost half of migrant workers living in packed

  • dormitories in Singapore had had a Covid-19 infection.

  • Social distancing in a dormitory, where there are 12 men sleeping there and using that as

  • their living quarters, transmission will happen.

  • Covid will spread.

  • And that happened.

  • We saw that.

  • We saw that in Singapore, we saw in Malaysia, we saw that in Thailand.

  • If there was anything good that came out of this pandemic, it did shine a much-needed

  • light on the living conditions of these workers in Singapore, and I'm sure it's the case all

  • over the world as well.

  • Despite the challenges, migrant workers provide a great benefit not only to their host country,

  • but for the countries they hail from.

  • What does it bring a country?

  • And I think it brings a country an incredible diversity, richness and economic benefit.

  • It will benefit the broader economy because of a lot of demographic challenges related

  • to low birth rates, the ageing population.

  • Those are really challenging, longer-term, big structural demographic questions that

  • are not going to be resolved anytime soon.

  • The money migrant workers send back home is such a lifeline to the families who are receiving

  • them.

  • So, the official record of remittance flows to low and middle-income countries was $540

  • billion in 2020.

  • If we're going to start to think seriously about global inclusive economic growth, then

  • it cuts both ways as well.

  • I think many of the countries, the countries where they are from, start thinking seriously

  • about how can we reconfigure our economy, to make it more attractive for this pool of

  • labour that feel that there are no opportunities or the opportunities are better overseas because

  • of the income and the exchange rate.

  • How can we retool and reconfigure our economy, to offer a value-added incentive for them

  • to stay in that country?

  • Because after all, they are assets.

  • And losing them to another country is, yes it's part of labour mobility, but I think

  • it also says a lot for the lack of a longer-term structural plan to really take the economy

  • to the next stage in those countries.

  • Over time, migrant workersboth high- and low-skilled - bring substantial economic

  • benefits to their host countries, especially high-income ones.

  • Addressing the shorter-term challenges could be the key to maintaining this progress.

  • Sri, did you know that three out of four of my grandparents are migrants and they all

  • worked here.

  • I think everyone has that story, you know, “bring me your huddled masses yearning to

  • breathe free.”

  • And my parents, it's something that resonates with me as well.

  • The civil war in Sri Lanka escalated and really started to take a turn for the worse.

  • My parents came to the UK in 1968.

  • My father wanted to improve his skill set as a doctor, and we made our lives there.

Did you know that 1 in 20 workers worldwide is a migrant?

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Why rich countries are so dependent on migrant workers | CNBC Explains

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    Summer posted on 2021/10/14
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