Should Barbados and the region be worried about brain drain?
There are 250 million international migrants around the globe, of whom 21.3 million are classified as refugees. South-South migration is larger than in South-North migration. Intra-regional migration is large in Europe and Central Asia, the Middle East and North Africa, and Sub-Saharan Africa.
Many of the Bank’s client countries – for example, India and South Africa – are large destination countries for migrants. Income gaps and inequality, demographic imbalances, and environmental change suggest that migration pressures will continue for the foreseeable future.
In 2015, the ratio between the average income of the high-income countries and that of the low-income countries stood at 70:1. It will take decades before these gaps are closed.
A well-documented demographic divergence separates high-income countries and the developing countries, especially those in Africa and Asia. In Western Europe today we find one 20-year-old for every 65-year-old – and this ratio is projected to be halved by 2040. But the ratio is 4:1 in India and 7:1 in Nigeria. Population ageing will produce large labour market imbalances and fiscal pressures in high-income countries as the tax base narrows and the cost of caring for the old surges.
On the other hand, developing nations with growing pools of young people will need to create large numbers of jobs to reach their targets for poverty reduction and growth. The working-age population (15+) in the developing countries will increase by 2.1 billion by 2050. If national employment is maintained at the same rate as in 2015, only 1.2 billion of those people will find employment in their own country, leaving nearly 900 million in search of work.
Migration brings large benefits to migrants and to the countries involved. But it also brings challenges. Migrants from the poorest countries, on average, have experienced a 15-fold increase in income, a doubling of school enrollment rates, and a 16-fold reduction in child mortality after moving to a developed country.
In the origin countries, migration lowers unemployment, opening access to more-productive and higher-paying jobs. Migrants’ remittances offer tangible benefits to origin countries. In 2015, remittance flows to developing countries reached US$432 billion, more than three times the size of official development assistance. Migration also facilitates trade, investment, and transfers of technology. But migration may also involve costs, including the so-called brain drain, especially associated with the migration of teachers, doctors, and nurses.
In the destination countries, immigration increases labour and skill supply, innovation, and entrepreneurship. A recent Organisation for Economic Cooperation and Development report (2013) demonstrated that immigration provided a net positive fiscal effect.
In the ageing societies, immigration of young workers could ease the strained pension systems and the burden of caring for the elderly.
Despite the documented benefits of immigration, many people and policymakers in destination countries fear that immigration leads to loss of jobs, imposes heavy burdens on public services, erodes social cohesion, and increases crime levels. These negative perceptions are factually incorrect or overblown.
The wage and employment effects of immigration are relatively small, since migrants and natives are not competing for the same jobs; in many countries, migrants have net positive effect on government budgets; and immigrants are less likely to commit serious crimes or be behind bars than the native-born.
Dilip Ratha is manager of the World Bank Group’s Migration and Remittances Unit.
