How 2020 Paused Global Migration – and how to get it back
How will migration shifts effect the global workforce?
Global labour migration was the key pillar of early globalisation and remains a driving economic force today. Internationally, the past year has been characterised by upheaval, disorder, and restrictions – but how has the pandemic and growing political resistance to immigration affected the global workforce?
Labour migration was effectively shut down by the pandemic in early 2020. While a few exceptions were made for professional travel, immigration became increasingly complicated as countries closed their borders. Between March 2020 and February 2021, around 105,000 movement restrictions were implemented around the world and current estimates predict a decrease of 2 million international migrants globally compared to pre-pandemic figures.
These restrictions paired with European political changes have left a pronounced effect on the global movement of workers and may even result in fundamental changes to the labour market.
The Great British Take Off: Migration and Skills Gaps
Migration is needed to plug talent gaps. When migration trends shift, availability of talent shifts and this can have positive or negative impacts depending on the direction of the trend.
Talent is vital to innovation – if countries cannot homegrow their talent, then it needs to be drafted or trained into the workforce from external sources in order to retain competitive advantage on the global stage. Encouraging migration, whether on a long-term or temporary basis, is a key way of doing this.
A clear example of the impact of migration is currently being seen in the UK. As a result of the pandemic, it is estimated that 1.3 million foreign-born workers have left the UK for their home countries – 700,000 of those in London alone. Thought to be the result of furloughs, job losses and inability to access financial support, the accommodation, manufacturing, food and retail sectors have been the worst hit by the exodus.
The long-term impact of this migration is yet to be fully understood, but there are likely to be challenges. These sectors have long relied on the influx of lower cost labour from the EU – and in a post-pandemic world where a year of losses need to be recouped, wage levels are not likely to attract the required numbers of local workers.
The British Retail Consortium also flagged the necessity of EU workers in the UK to fill skills gaps in areas such as data analysis and pharmacy, scarce in the local labour market. Similarly, with restrictions lifting at fairly short notice, the scramble to rehire from a limited talent pool will present further challenges for employers.
Europe Reckons with Brexit
Coming into force on 31st December 2020, the UK ended a turbulent year with a new trade and cooperation agreement with the European Union.
New research from a LinkedIn Workforce Report indicates there was a significant shift in migration throughout the post-Brexit transition period that occupied most of 2020. Australia, previously the top destination for people leaving the UK, was knocked off the top spot by Germany. Migration from the UK to the EU has also increased, while those entering the UK from the European block decreased.
This trend increased in 2021, with net migration from the EU to the UK down 24% in January 2021. In contrast, migration to the UK from the rest of the world, non-EU countries, was a net positive throughout the same period. LinkedIn’s Siobhan Morrin claims the UK’s March lockdown worked to accelerate the outflow to the EU, with France and Germany becoming the top destinations in March 2020 for people leaving the UK.
Forecasts suggest this type of workforce migration will continue into 2022. Looking beyond this, the UK’s migration flow will depend on just how well the UK economy recovers post-Covid, especially those industries battered by the pandemic restrictions. If workforce talent outflow continues to favour Europe the UK may bear the economic brunt of this shift.
Offsetting the Demographic Time Bomb
Countries with ageing populations need to be mindful of the future impacts of reduced migration; advancing age demographics mean more spending but less revenue for economies. Countries with working-age populations on the decline need to entice tax-paying foreign migrants who can help to fund local infrastructure and social care.
The UK and EU both have ageing populations. As MEP Damian Boeselager reflects in a recent op-ed, “Demographics is sadly one of the most precise social sciences – and it does not look good for us.” Without an active movement to encourage and increase migration, countries with ageing populations could be looking at future economic difficulty.
By contrast, sub-Saharan Africa’s working-age demographics are rapidly increasing, but local employment opportunities are low paid or lacking outside of the agricultural sector. Some groups such as the Centre for Global Development are lobbying for better legal pathways into EU work for sub-Saharan African migrants – hoping this will help to plug the EU’s resource gap in the coming years.
Less Migration, More Automation?
Erol Yayboke of CSIS, argues that decreased workforce migration will cause companies to accelerate their automated capabilities, leading in turn to inevitable job losses. Yayboke also maintains that ‘stay at home’ orders and enforced quarantines across the world will naturally speed up this process.
Uber has recently found itself on the wrong side of the workforce automation debate after losing a court case to four drivers sacked by an automation process that included profiling.
To some extent, labour-saving technologies are a natural progression of modern workforces. However, if rushed, as Yayboke suggests the pandemic may encourage, automated capabilities may be rolled out before their time or even used to stem the flow of labour loss beyond its capabilities. Creativity and interpersonal skills are the most obvious attributes sacrificed to increased automation, the latter is highlighted by the recent Uber controversy.
The other side of this cause and effect is that labour-saving technologies often have a knock-on effect of kickstarting mass migrations of low-skilled workers who have been made redundant. Progress and development can often disadvantage the most vulnerable of workers and variations in local labour laws mean that workers are largely dependent on migration if these issues do arise.
Backing Migration: Next Steps
Over a year on from the onset of COVID, the picture of global migration is far from anything that could have been predicted. With a large welfare bill to contend with and resource holes to fill, getting people into work and economies afloat will be a big priority for governments.
Encouraging legal migration will help to increase resources and recoup vital tax funds. By building talent partnerships between countries, skills from abroad can be brought in and even trained into the existing population. The EU recently announced a conference in May to launch its new Talent Partnerships initiative, creating legal pathways between EU member states and certain third countries.
Support will be needed from governments to uplift migration in the coming years – particularly in reversing the populist anti-immigration stance that swept the world in the 2010s. This means new policy and messaging to generate groundswells of support for migration amongst their citizens.
Countries that embrace innovation and get behind new modes of work are likely to see positive impacts to migration levels. Recent phenomena brought about by the pandemic such as international Employer of Record with immigration support, and much-discussed digital nomad schemes will help to drive foreign nationals to live, travel and work internationally.
Ultimately, the pandemic has brought to light the value of migrants to our economies and infrastructure – a lesson that will hopefully be heeded for future prosperity.
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The information provided has been checked for accuracy as of the date of publication, and is intended as a general guide and for information purposes. It is subject to unanticipated and unexpected changes and does not constitute legal advice.