The backbone of large economies is directly related to the level of skills of their labour force. Highly industrialized and technologically advanced nations such as the United States of America and Japan continue to boast good economic results as they bare a technically proficient and educated working population.
Whilst this may hold, it is important to note that not all their professionals hail from the host country. According to the American Immigration Council there are over 247 000 foreign doctors registered to practice in the USA which translates to 25% of all doctors in the country. Even though the number does not split the number of doctors from developed and developing countries, it is critical to understand that with the societal ills prevalent in developing countries, developing countries cannot afford to lose highly skilled professionals.
This phenomenon is referred to as Brain Drain. Brain Drain is the emigration of skilled workers usually from poor countries seeking better opportunities abroad. This phenomenon is prevalent all over the world as professional’s emigrate for better wages and economic prospects.
According to an article by The Economist titled “What educated people from poor countries think about the brain drain argument” it was found that in the period 2010 – 2011, the number of immigrants settling in OECD countries increased by 60%. In the context of Africa, it was found that there was a deficit of 31% in the demand for doctors in Uganda.
These statistics are alarming as developing countries need highly skilled individuals to contribute to the development and the overall betterment of the economy.
In the context of South Africa, Fin24 released an article in 2019 titled SA brain drain worsens as expats plug skills gaps abroad, says new report argued that South Africa is experiencing an increase in the number of people emigrating. In an effort to quantify this claim, Pew Research found that in the year 2017, over 900 000 people had emigrated from South Africa with the majority being professionals.
With the 4th industrial revolution looming, can South Africa really afford to lose skilled people at this rate? According to immigration specialist Marisa Jacobs, it was found that the most difficult skills to source were those in ICT and engineering. To add on, jobs that will exist in the next 10 to 20 years will require employees who are proficient at coding, data analysis and other ICT related skills. Importantly, this case is not unique to South Africa as these skills are highly sort in developed nations such as New Zealand, the United Kingdom and Australia.
Firms have already begun a process of culling jobs in the banking and retail sector as things shift from analog to digital.
However, there is a school of thought from some scholars that argues that the idea of brain drain is not a total loss for the host country. To explain, professionals employed abroad pay over remittances to the host country. Whilst these remittances help they will not equate to the impact in the host country’s economy.It was also found that the amount paid was not directly proportional to the level of education but there was a substantial difference when taking into account university graduates and blue collar workers.
In a journal article released by Julia Bredtmann, Fernanda Martinez and Sebastion Otten in 2018 titled Remittances and the Brain Drain: Evidence from Microdata for Sub-Saharan Africa, it was found that university graduates remit around 304 USD.
Professionals working in some of the developed countries have expressed that they have moved to greener pastures in an effort to assist their families back home. As previously mentioned, economic conditions and political instability is the main driver of emigration.
In order to curb this, developing countries need to:
· Incentivize highly skilled professionals to work in the host country.
· Reduce the amount of barriers to open businesses.
· Create or implement policy that is sustainable.
· Create an environment that is investor – friendly.
The abovementioned initiatives represent a microcosm of what regulators need to do in order to curb the increase in skilled people leaving the country. Remittances assist but they will never be enough. The survival of this country needs a collective effort from the state, business and the working class.