Beruflich Dokumente
Kultur Dokumente
ECONOMIC SCIENCE
DEPARTMENT BA, REI, TOURISM
ALFIOROVA IRINA
INTERNATIONAL LABOR MIGRATION BETWEEN COSTS AND
BENEFITS
DIPLOMA PROJECT
365.1 International Economic Relations
Autor:
student gr. E31A,
nvmnt cu frecven la zi
ALFIOROVA Irina
________________
(semntura)
Conductor tiinific:
AU Nicolae, dr. hab., prof. univ.
________________
(semntura)
Admis la susinere
ef catedr BA, REI, TURISM
N. Burlacu, dr. hab., prof. univ.
(numele, prenumele, gradul tiinific)
__________________________
(semntura)
Chiinu, 2015
CONTENS
ANNOTATION..............................................................................................................................3
ADNOTARE...................................................................................................................................4
LIST OF ABBREVIATIONS........................................................................................................5
LIST OF ILLUSTRATIONS........................................................................................................6
LIST OF TABLES.........................................................................................................................7
INTRODUCTION.........................................................................................................................8
CHAPTER 1. THEORETICAL ASPECTS ABOUT INTERNATIONAL LABOUR
MIGRATION...............................................................................................................................10
1.1.
ANNOTATION
The aim of the diploma project: Identifying costs and benefits of international labor
migration. Objectives: to describe the theoretical basis of labor migration as a form of
international relations, to discover the main reasons for international labor migration, to identify
immigration and emigration countries, to provide solutions to stop illegal migration.
Results: Revealed features of international labor migration, was developed a draft of
benefits and costs the country may have from labor migration, were identifyed the areas of
migration and modern centers of gravity of workforce.
Conclusions and recommendations: The main reason for this research was a need to
understand and distinguish the costs and benefits of international labor migration. Certain
analyses concerning the main reasons and consequences of migration as for the accepting and
sending countries were carried out.
So as it was shown above, the international labor migration arises because of a certain
contrast in levels of economic and social development of the states. At the same time, the world
practice shows that labor migration provides undoubted advantages to the countries both
importing workforce, and exporting it. But thus arise certain social and economic issues.
The import country faces the deterioration of demographic situation, deficiency of
professional labor and the growth of inflation because of workforce outflow. However, the
decrease of unemployment and investments into the donor country economy will promote the
improvement of economic indicators. The convergence of compensation levels in the donor
countries and the recipient countries can reconcile these ambiguous consequences of labor
migration. Similar levels of salaries smooth and harmonize the costs and benefits of labor
migration, gradually leveling economic development of the countries.
The author: Irina Alfiorova
The title of diploma project: International labor migration between costs and benefits
Speciality: 365.1 - REI
Place of defence: Chisinau, ULIM
Structure: Introduction, Two chapters, Conclusions and recommendations, 21
bibliography sources, 41 pages of text (up to the bibliography), 11 figures and 5 tables.
Tags: remittances, mobility, work, citizenship, ability, placement, migrant, wage, salary,
foreigner, laborforce.
ADNOTARE
Scopul proiectului de diplom: Identificarea costurilor i beneficiile migraiei
internaionale de munc. Obiective: Descrierea teoriei de baz a migraiei forei de munc ca o
form a relaiilor internaionale, a descoperi principalele motive a migraiei internaionale de
munc, indentificarea arilor immigrate i emigrate, pentru a oferi soluii de a stopa imigrarea
ilegal.
Ca rezultat: Dezvluind problemele migraiei internaionale de munc, au fost elaborate
un ir de beneficii care rile le pot avea de la migraia internaional, au fost identificate
domeniile migraiei i principalele centre a forei de munc.
Concluzii i recomandri: Principalul scop al acestei cercetri este nevoia de a nelege
i a distinge costurile i beneficiile migraiei internaionale a muncii. Anumite studii cu privire la
principalele motive i consecine ale migraiei au fost efectutate.
Cum a fost spus mai sus, migraia internaional a muncii apare din cauza diferitor nivele
de dezvoltare economic i social. n acelai timp, practica mondial arat c migraia forei de
munc ofer avantaje incontestabile fa de trile att importatoare a forei de munc ct i
eportatoare. Dar n acelai timp apar anumite aspect economice i sociale.
rile importatoare de for de munc se confrunt cu deteriorarea situaiei demografice,
deficit de for de munc profesional i creterea inflaiei, cauz fiind emigrarea forei de
munc. Cu toate acestea, scderea omajlui i a investiiilor n ecoomia rii donatoare va
promova mbuntirea indicatorilor economici. Convergena nivelurilor de compensare n rile
donatoare i a rilor beneficiare pot aduce la sfritul acestor consecine privind fora de munc.
Nivele similare de salarii aduc la armonizarea costurilor i beneficiile migraiei forei de munc
care treptat aduc la dezvoltarea economic a rilor.
Autor: Irina Alfiorova
Titlul proiectului de diplom: Migraia Internaional a forei de munc ntre costuri i
beneficii
Specialitatea: 365.1 - REI
Locul de aprare a practicii: Chiinau, ULIM
Structura: Introducere, Dou Capitole, Concluzii i Recomandri, 21 de surse
bibliografice, 41 pagini de text (pin la bibliografie), 11 figuri i 5 tabele.
Tags: remitene, mobilitate, loc de munc, cetenie, abilitate, plasament, imigrant,
salariu, strin, for de munc.
LIST OF ABBREVIATIONS
AIDS- Acquired Immune Deficiency Syndrome
CIS- Commonwealth of Independent States
ESR- Economic Self Reliance
GDP- Gross Domestic Product
GNP- Gross National Product
ILO- International Labour Organization
IMF- International Monetary Fund
MNC- Multinational Corporation
NIS- Newly Independent States
OPEC- Organization of Petroleum Exporting Countries
UAE- United Arabic Emirates
UN- United Nations
USA- United States of America
LIST OF ILLUSTRATIONS
Pic. 1.1. State institutions involved in solution of labor migration problems....15
Pic. 2.1. Top 6 countries with the highest number of immigrants (2013).21
Pic. 2.2. Sources of Moldavians income, 201225
Pic. 2.3. Labor immigrants in Gulf States.28
Pic. 2.4. 12 recipient countries with the biggest amount of remittances in 2013..31
Pic. 2.5. 12 countries with the greatest relative volume of remittances in 2012, % of GDP of the
respective countries....32
Pic. 2.6. Remittances to the former federal republics of the USSR in 2012, % of GDP of the
respective countries33
Pic. 2.7. Positive consequences of labor migration for recipient countries...35
Pic. 2.8. Negative consequences of labor migration for recipient countries.36
Pic. 2.9. Positive consequences of labor migration for sending countries38
Pic. 2.10. Negative consequences of labor migration for sending countries.........39
LIST OF TABLES
Table 1.1. Emigration and Immigration definitions...10
Table 2.1. Classification of Migrants, 5 main types...19
Table 2.2. Population of Gulf States (2013)...27
Table 2.3. National and Non-National Employed Persons Kingdom of Bahrain28
Table 2.4. Number of workers deployed by destination, 2012...30
INTRODUCTION
Relevance of a subject of the project. The phenomenon of international migration is not
new. But even today, in order to determine the exact volume of the international movement of
such an important factor of production seems to be quite difficult.
It is important to study the phenomenon of migration while it can be regarded as a very
specific element - the reproduction of the population that, of course, does not exclude,
considering the migration from neighbouring fields of knowledge geography, for example, that
studies patterns of human sttlement.
Generally, under the reproduction of population is understood only in the process of
generational turnover of their socio-economic conditionality. While the population, as well as its
composition, is considered as a subject to constant change.
At the same time, duration of unemployment usually gives a more accurate assessment. It
may indicate the rapid spread of some technological innovations that may cause dynamic
changes in the labor demand structure and so its intensive migration, high mobility of labor
market, the existence of effective information systems about different vacancies, retraining of
workers and others.
Labor migration is also understood as an international division of labor which is the
highest stage of public territorial labor division development between the countries, that provides
a stable concentration of production of products in certain countries.
Simple interpretation of the international labor division as the separation of certain
human activity types does not necessarily imply its endorser cooperation - based on international
division of steady labor exchange between the countries and products which produced by them
with greater economic efficiency.
This cooperation happens to be in two forms: the international exchange of goods
(i.e.international trade), that is produced on the basis of labor division or that is produced on the
basis of inter-state movement of labor which is International Labour Migration.
Also, migration is an important part of mankind history because it is connected with
settlement process, agricultural land development, education and racial mixing, products
capacity development, peoples and languages movement.
Gaining ethnosocial and ethnopolitical character in recent years, the phenomenon of
migration introduces some changes in local societies lives, it also changes personal
characteristics of those who have to move to other territories for better life and better future.
Within the XX century the intensive expansion of migratory streams was observed, so to
the end of the century the phenomenon of migration became a factor of all global problems. Due
to this fact, it demanded new approaches to the migration policy that promote achievement and
maintenance of balance of interests of those participating in regulation of migratory processes.
Relevance of migration research at the universal level is caused following circumstances:
-expansion of legal framework and emphasis of attention of the international public on a
perspective of human rights to which, of course, belongs the right of free movement
-the ripened need of migration analysis, taking into account its purposes, tasks and the
contents in concrete regions and also extent of its impact on other spheres of public relations
-change of social and political parameters of political development, acceptance and
implementation of new laws striking the rights of the population
-need of scientific judgment and understanding of a socio-political orientation of the
relations between migrants, as well as between migrants and local population.
Consequences of migration are shown in various spheres: political, economic, social,
cultural, psychological and others. Moreover, these consequences have both positive and
negative aspects, thus becoming a source of conflicts. All this defines the relevance and
importance of studying the problems of political and legal regulation of labor migration.
The aim of the diploma project. Identifying costs and benefits of international labor
migration.
On the basis of the aim of diploma project the following objectives were set:
- to describe the theoretical basis of labor migration as a form of international relations
- to discover the main reasons for international labor migration
-to identify immigration and emigration countries
-to provide solutions to stop illegal migration.
Research methodologies. Here are the following scientific methods of research that formed
a methodological basis of writing the diploma project: standard method, logical analysis,
comparative, statistical, induction and deduction, graphic, quantitative and qualitative,
descriptive and analytical methods.
Review of special literature. The scientific and theoretical basis of the degree project
were formed by works of such national and foreign authors as: Oded Stark, J.Edward Taylor,
Gaugas P., Rybakovsky L., Gaston N. and Nelson D., Rahman M., Sykes A. and others, who
described the reasons, factors and problems of migration, as well as analysed costs and benefits
of such phenomenon as international labor migration.
Emigration
-Belgium
-the USA [20].
Developing countries like the Republic of South Africa, Israel, Kuwait and Malaysia use
foreign labor most actively. But still, the largest private character transfers are mostly made by
developed countries like the USA, Japan, Germany and Great Britain. A lot of remittances come
from new industrial and oil-extracting developing countries too, the examples are: Korea, Saudi
Arabia, Venezuela.
In many developing countries, the transaction scales of private character make about 25%
or even 50% of commodity export income; here are such countries as: Bangladesh, Morocco,
Egypt, Jamaica, Malawi, Greece, Pakistan, Portugal, Sudan, Sri Lanka, Turkey. In Jordan and
Yemen, for example, the remittances reach to 10-50% of the GNP.
In addition to this, labor export is considered as an important source of foreign currency
to the country.
According to the IMF, the average rate of return when exporting goods makes 20%, it
makes 50% from exporting services, and the percentage from labor export is much higher. For
the last 15 years labor export has a strong impact on Pakistan economy. The remittances to this
country are 5 times higher than the money received from export of goods and services.
Anually receiving loads of money just from this source, many developing countries began
to consider migrants remittances as the most important source of the currency income.
From the theoretical point of view, the donor countries receive benefits from labor
migration not only because remittances sent by emigrants. There are also a lot of benefits which
address to another types of income. These ones increase the cumulative GNP and favorably
affect the balance of payments.
Here are meant the direct and portfolio investments in migrants home-country economy,
less training expenditures, also, health care and some other expenses of social character which
are covered for emigrants by the other countries. Moreover, having gained experience abroad and
having improved their skills, migrants bring this experience home, therefore the country receives
additional qualificated experts.
Emigration does a very notable positive impact on developing countries economy, as the
departure of workers reduces unemployment scales. So, in the 70th, the Egyptian government
accepted certain programs that stimulated workers to emigrate to Gulf States, thus fighting
against unemployment.
Though, so called brain drain became a serious problem for the most of the developing
countries, especially for those in Africa, like Malawi, Zaire, Sudan, Zambia. However, it usually
12
happens that "brain drain" stops when the country economic situation improves. Here is an
example of the Indian scientists who returned home after they worked in American corporations
around the Silicon Valley for some years, and then became founders of a new Indian industry
development, like the creation of new computer programs.
There is a growth of donor countries influence in modern international labor migration,
while the governments understand the benefits of labor export and apply various methods of
emigration stimulation:
1. Countries emigratory policy respects the citizens rights for free movement. Some countries have
certain emigration control policy, especially in the relation of the qualified experts, an adverse
demographic situation, and also when there is a lack of laborforce in sending country. Thus they
protect donor countries interests, regulate emigration scales, as well as qualitative structure of the
emigrants.
2. In order to provide financial resources to national economy, the attraction methods of
remittances and migrant workers currency means are used. For this purpose national banks open
currency accounts under a higher interest rate for emigrants, some banks also create certain
favorable conditions for acquisition of goods and production equipment. A number of countries
directly obliges emigrant workers to transfer a considerable share of the salary received abroad
to the country of origin. The state also raises funds by introduction of obligatory deposits and
insurance to the private intermediary organizations which are responsible for
citizens
employment abroad.
3. There are certain bilateral agreements which provide economic and social guarantees and
protect migrant workers rights (on salaries, housing, food supply, medical care, etc.). Also
certain funds and presentations are organized for the purpose of control over the implementation
of the international agreements conditions, as well as the solution of controversial issues in
foreign country and observance of migrants basic rights.
In the governments of some countries there are attaches who are urged to provide
protection of the migrant workers rights, including the solution of controversial issues and
negotiating with employers abroad.
So, the labor sending countries seek to develop such a mechanism that will regulate
migration as well as protect state interests. Thus, they obligate the enterprises which are engaged
in sending labor abroad to have a license, they also create special funds which support the
migrants who came back home, they control highly skilled workers migration as well.
The countries accepting laborforce receive thus defined benefits, as first of all
competitiveness of the goods on the market owing to reduction of the production costs while the
13
price of foreign labor is lower. Also, the Organization for Economic Cooperation and
Development of ESR claims that immigrants improve a demographic picture of the developed
countries suffering from aging. In France, Germany and Sweden 10% of all newborns appear in
the families of immigrants. In Switzerland there is 24%, while in Luxembourg nearly 38% [12,
p.33].
At the same time, though the general rate of aging of the countries population is slowed
down, this statistics doesn't affect the ratio of birth rate and mortality of local population in no
way.
It is necessary to remember about some negative aspects connected with labor import,
while there may emerge elements of social tension in society (for example, when migrant
workers take all the jobs from local population), international hostility, etc.
For this reason the countries develop a certain Immigration policy. The majority of host
countries use selective approach for immigration regulation. It means that the state doesn't
interfere to entrance of those categories which are necessary for the country, limiting entrance to
those the country doesnt need at the moment. The list of desirable immigrants varies from the
country to the country, but usually they treat one of the following categories:
-
the workers, who are ready to do harmful and dirty jobs for the minimum payment, which is
employees;
representatives of rare professions - gem cutters of diamonds, pictures restorers, doctors
14
the Ministry of
Foreign Affairs
the Ministry of
Justice
the Ministry of
Labour
Pic. 1.1. State institutions involved in solution of labor migration problems [developed by
the author]
In the majority of the countries the entry visa to the immigrant is issued on the basis of
the signed contract with the employer and the Ministry of Labour conclusion whether this kind
of work demands special skills, so it can't be carried out by local workers. In some countries
before issuing the entry visa to the potential immigrant, the employer is obliged to receive the
Internal Affairs Ministry approval.
Standard and legal base for the immigration in the majority of host countries is presented
by a huge number of laws and bylaws. Here are the main lines of the immigration legislation:
Professional qualification. All host countries legislations establish strict requirements to
education level and length of service in the specialty. The minimum requirement to education is
considered to be a full course of high school or technical training college that has to be
confirmed by the corresponding diploma. In most cases this diploma has to be approved or
estimated by regarding compliance of requirements in the host country.
The priority at the employment is usually given to the experts having at least 3-5 years of
length of service in the specialty. Letters of recommendation can be demanded as well.
15
16
Indonesians do in Malaysia, and Bolivians are willingly employed in Argentina. Moreover, some
branches of production wouldn't survive without immigrants. Certainly, it is impossible to deny
that there are some negative consequences of immigration too, and, first of all, the decrease of
real salaries due to the inflow of unskilled labor is among them.
sometimes even political damage, while on the contrary, the countries that accepting specialists
emigrants acquire the huge and cheap intellectual capital. There is a similar process of exporting
financial capital abroad which is called drain of capital.
There are various reasons of labor migration. It can be some features of society and life,
ecological factors, a difficult political situation and others. In most cases the migrant can not
simply support himself and his family so all that compels them to travel in search of worthy
earnings worldwide. In certain cases these skilled experts seek to reach the maximum career
development and then go abroad.
Nevertheless, the economic reasons of labor migration are on the first place. It is a fact
that only some dominating countries own the most of world resources, while third countries
are doomed to poverty. Such situation makes migrants go abroad and look for earnings. Not
every government takes measures of regulation of labor migration at the state level, so probably
the solution of this problem wont appear soon.
Migrants are classified in accordance with International Labour Organization:
Table 2.1. Classification of Migrants, 5 main types [developed by the author]
Types of Migrants
1.Unskilled and low-skilled workers
Their characteristics
1. Labour activity on contract which
clearly stipulates allowed period of staying in
the country, usually applied to part time
workers
2. Businesses with a high level of
theoretical and practical training with an
3. Illegal migrants
appropriate education
3. Foreigners with an expired tourist
4. Immigrants
5. Refugees
residence
5. People who are forced to emigrate
from their countries due to any threat to their
lives and activities
International statistics show that while the bunch of migrant workers are low-skilled ones,
they are employed in industry and agriculture. However, there is a constantly increasing flow of
migrant experts - higly skilled workforce employed in prestigious and well-paid positions.
19
20
The main centers of a labor migration are multioccupied countries: China, Pakistan,
India, Indonesia, Bangladesh, African countries.
According to the International Labour Organization there are over 130 million of labor
migrants all over the world though about 40% of foreign workers don't pass official registration
in countries of residence so these statistics aren't considered.
According to the report of UN Department on economic and social problems from
September 11, 2013, the number of migrants worldwide made 232 million people or 3,2% of the
Earth population. The world largest migratory corridors became Mexico - the USA from 13
million migrating ( the dates are for January - August, 2013), Russia - Ukraine from 3,5 million,
Ukraine - Russia from 2,9 million, and also Kazakhstan - Russia from 2,5 million [20].
Great Britain
UAE
Saudi Arabia
Germany
Russia
USA
0
10
15
20
25
30
35
40
45
50
Pic. 2.1. Top 6 countries with the highest number of immigrants (2013)
[developed by the author with use of data 20]
Though official data on population shift does not always show a full picture of the events.
So, officially the trainees and students who arrived to other country for training aren't considered
as migrants, as well as tourists, which came to the country on a tourist visa and try to illegally
21
find a job. Also, usually nobody considers those migrants who aren't registered, despite the fact
that the purpose of their entrance is often employment in the country.
As a rule, the international immigrants are young and healthy people. Most of migrants
(about 74% of total number) are in working-age (which is from 20 to 64 years), in comparison
with less than 57% of the total number of a world's population [5, p.71].
Thus, host countries usually receive essential benefits from the inflow of able-bodied and
qualified migrants, especially when their qualification is considered and involved. Therefore, the
involvement of young and talented migrants becomes an important political task in many parts of
the world. Though migration of the qualified labor and experts with the higher education brings
benefits to host countries, it can also have negative consequences for development in countries of
origin.
These negative consequences can be especially bad for those countries which face a
serious shortage of qualified personnel, and also for those ones with rather small amount of
population. At the same time, remittances continue to be an important help for families and a
steady source of foreign currency in many developing countries.
The InterNations.org portal conducted a research among 14000 emigrants of different
nationalities to find out what countries of the world are the best immigrate in. Respondents of
165 nationalities from 169 countries of the world took part in this poll.
So, these are top-10 countries for immigration:
1. Ecuador
2. Luxembourg
3. Mexico
4. Switzerland
5. USA
6. Singapore
7. Spain
8. Philippine Islands
9. Australia
10. Hong Kong [18].
In this rating Germany took the 12th place, Canada the 14th, Great Britain is on the 21st,
while Russia is on the 54th place. Quite high position is also taken by the Czech Republic, which
has the 17th place. By drawing up a rating, the respondents estimated a complex of criteria:
simplicity of arrangement in the country, the level of income, possibilities of employment,
quality of life and education.
22
Ecuador is one the first place of this rating thanks to the "level of the income" position.
Most of the emigrants, who live in this South American country, are quite happy with the
financial position at the expense of a favorable ratio of level of salaries and life expenses.
The other important factor is the level of satisfaction with the life in general. Moving in
Ecuador does happy 44% of people, and almost all of them have a plan to remain there for the
rest of the life. One more good criteria is that week work on the average lasts only 34 hours.
If Ecuador is the country of happy immigrants, Luxembourg is a dream country for
careerists. 64% migrants in Luxembourg, according to InterNations, moved there because of the
career opportunities. People find jobs independently in Luxembourg, without the aid of agencies
or the translation in the company.
However, immigration to Luxembourg is not a long-term one: only 28% of migrants
want to remain there for a long time. The others just plan to work the contract and then leave.
The striking contrast with Ecuador is evident, while Luxembourg took only the 50th place from
61 on the level of personal happiness. Besides, many immigrants complain that it is hard to make
friends in Luxembourg and the situation for visitors is not the most hospitable one. And still,
almost all of them consider that housing in Luxembourg is too expensive.
91% of immigrants in Mexico are happy with their life, 44% of them intend to remain
there for the rest of the life. The reason of moving to Mexico most often is employment or
romantic relations with the inhabitants of this warm country [18].
To sum it up, according to InterNations, the best countries for labor immigration are
Norway, Luxembourg, Germany and Switzerland. The first ten countries with good opportunities
of employment are also Austria, Denmark and Sweden.
Moldova as an example of labor export country
The Republic of Moldova proclaimed its independence in 1991. Being independent, the
country of Moldova initiated some economic and social reforms in order to transit to the market
economy. Some relevant changes were achieved, but in spite of the initial estimates, the expected
results werent attained. Moreover, it led to deepening economic crisis, a catastrophic living
standards decline, and insecurity. Emigration of a large part of able-bodied workforce has
diminished country human resources considerably. Every year more and more experts, doctors,
scientific researchers, school teachers and academics leave the country in search for a better
place to live.
The reason for this brain drain is poverty first of all. For example, in 2002, the rural
poor counted for 72.6 of the very poor inhabitants of the country [7, p.348].
23
In 2002, over 40% of the country population lived below the poverty threshold. This
generated some serious social and economic problems, from fall in the natural birth to growth
rates of massive migration, which was about 35-40% of total economically active population [7,
p.349].
Among European NIS countries, Moldova has one of the highest levels of emigration.
According to the data from the Department of Migration, between 1990 and 2003 years,
the total number of people who left Moldova and went to foreign countries for the purpose of
work was about 600,000, or 37% of economically active population [19].
Moreover, some experts consider these numbers to be much higher than figures that are
given in national statistics, because a lot of citizens have left their country with soviet passports
of the former USSR, so a tourist visa, illegally remaining abroad when their visas expired. The
destinations Moldavian citizens were going to are listed below:
-Italy
-Turkey
-Estonia
-Greece
-Portugal
-Israel
-Romania.
Nowadays, the national bureau of statistics informs that the living wage for a person in
2014 averaged 1627 lei a month, which is 0,9% more than in 2013.
The population expenses in 2014 averaged 1816 lei a month for a person, having
increased by 2,3% in comparison with 2013 [19].
Yet, pensioners and other socio-vulnerable segments of the population do not have at
least these 1627 lei which is a living wage for a person. Some of these people cant work and
dont have any help from relatives or friends, so they have to put up with their miserable
lifestyle, while many of them choose to ask for money in the streets. While they do not have any
opportunity to earn money to sustain themselves, they have to hold out. Yet, there is also ablebodied population, willing to work and looking for the best opportunities. Unfortunately, most of
them find these opportunities somewhere far away from home-country, because whether there
are no suitable jobs in Moldova, whether the employers pay so little, that the workers can not
afford to have a comfortable life and they cant provide their families with things.
This is the reason Moldova is on the 6 place among the countries of the CIS by number of
the migrants who went to the territory of the Russian Federation for the purpose of work. This
24
individual economic
activity 9,5%
individual non-economic
activity 6,6%
Pic. 2.2. Sources of Moldavians income, 2012 [developed by the author with the data 19]
Remittances are an important source for people's budget. On the average, it represents
17,6% from the total income, so it's 0,3% more in comparison with 2013 [19].
The emigration of Moldavian skilled workers and professionals destabilizes the internal
labour market, as well as creates some serious difficulties for Moldovas accession to the
European Union. At the same time while working in another countries, the citizens of Moldova
gain the necessary skills for working in a market economy.
Emigration is also considered to be a financial resource for the national economy, and a
mean for maintaining the stability of national currency.
25
Although, the labor export has some positive effects for the countrys problems, the
officials become more and more aware that labor migration, especially illegal one, impedes the
stabilization of Moldovas labor market and leads to decreasing revenue in terms of social funds.
High unemployment rates in Moldova are not only because of a large number of young
people who can not find a job, but also because of those people, who have been made redundant
due to the company restructuring or insolvencies.
So, the intellectual exodus from Moldova has the following causes:
-
26
To sum it up, Moldovas progress towards a better future is possible only through a huge
socio-economic transformation, which is going to lead to a market economy, free initiative and
competition. Social problems of the last decade have considerably worsened the population
living standards. If as much as possible activities are centered on living standarts improvement,
brain drain will be directly reduced.
Also, the political stability and efficient government should also help to reverse the
phenomenon of brain drain from the Republic of Moldova.
Persian Gulf countries as an example of labor import countries
By the end of the XX century, some new world labor markets were added to the
traditional immigration centers like the USA, Canada and Australia.
These are oil-producing countries of the Middle East, Argentina and Venezuela in Latin
America, as well as the richest African states.
According to the UN, 12,8 million foreigners live today in six coastal Gulf States Bahrain, Qatar, Kuwait, Saudi Arabia, the United Arab Emirates, Oman. In general, their number
makes 34-40% of all population of this subregion of the Middle East and nearly 70% of its
laborforce [20].
Country
Bahrain
Kuwait
Oman
Qatar
Saudi Arabia
United Arab Emirates
Nationals
527,433
1,023,316
1,781,558
122,779
16,527,340
825,495
Non-nationals
511,864
2,159,644
559,357
543,730
6,150,922
3,280,932
27
90
50
2011
2010
2012
2013
No. of
No. of
Total
Percentag
National
Non-National
e of National
Employed
Employed
Employed
Persons
122,333
129,210
130,129
140,096
persons
244,192
273,107
309,045
365,670
366,625
402,317
439,174
505,766
Persons
33
32
30
28
The visitors in Gulf States are, first of all, labor immigrants. In total, they make more
than 35% of labor in Saudi Arabia, 44% of labor in Bahrain (informally 50-60%), 80% of labor
in Kuwait, about 90% in Qatar, more than 90% in the United Arab Emirates. Indicator in Oman
is 24% (due to successful omanization programs).
Labor demand in these countries is caused by such factors as shortage of qualified
specialists and the restrictions on women employment (among all the citizens participating in
economic activity, women make 2-10%) [21].
28
29
Emigration as well as immigration render contradictory consequences both for the donor
countries, and for the recipient countries, because the international migration of labor has
contradictory impact on these countries. It must be kept in mind that international labor
migration is a not only economic, but it is also a difficult political, social and economic
phenomenon. It considerably influences the structure of workforce for both donor and recipient
countries, it aslo creates a new situation in labor markets, introduces many changes (and not only
positive ones) in social and political life of many host countries.
Table 2.4. Number of workers deployed by destination, 2012 [5, p.30]
Destination
Males
Females
Both sides
136
899
481
3
1.450
6.081
8.308
8.136
8.090
9.485
82
2.929
3.011
2.787
2.476
12.264
4.744
396
1.163
455
682
3.183
3.630
12.719
5.426
Middle East
Qatar
UAE
Israel
Libyan Arab
Other
5.945
7.409
7.655
8.087
8.035
Asia
Hong Kong,
China
India
Malaysia
Singapore
Other
Europe
Finland
1.599
353
1.952
Sweden
2.913
416
3.329
2.291
2.156
4.447
66.290
11.519
77.797
Other
Total
Immigration, in particular, can cause a number of the problems connected with ethnic,
racial, religious and cultural differences of immigrants from indigenous people. As we can see in
table 2.4. there is totally different workforce structure in different countries, primary because of
religion, beliefs and cultural particular qualities.
This identifies that in some countries women have to work less and do not need to work
at all, and all jobs are taken by men. The examples of such and other features are practically in
all host countries.
The international migration has economic consequences for both recipient country and
for the sending country. In the USA and Australia it is generally considered that the host
30
country wins, eventually the other countries have a different view on this situation. The opinions
about the benefits of migration differ depending on the type of migrants (whether its qualified or
unskilled labor), it also depends on the condition of labor market in the sending and recipient
countries.
About 70% of their universal volume of remittances are the share of 20 largest countries
recipients (in 2012 - 69%, in 2013 - 68%). In recent years about a third of global volume of
remittances are from India, China, Philippines and Mexico. In 2012-2013 more than 60 billion
US dollars came to India and China [8, p.151].
In year of 2013 the list of the countries with the highest rate of remittances are: India (71
billion US dollars), China (60 billion US dollars), as well as other developing countries Philippines (26 billion US dollars), Mexico (22 billion US dollars), Nigeria (21 billion US
dollars) and Egypt (21 billion US dollars) [pic.2.4.]. These countries have more than a half
(53%) of all the money transfers sent to developing countries worldwide.
South Corea
Vietnam
Spain
Belgium
Germany
Bangladesh
Pakistan
Egypt
France
Nigeria
Mexico
Philippines
China
India
0
10
20
30
40
50
60
70
80
Pic. 2.4. 12 recipient countries with the biggest amount of remittances in 2013 [6, p.58]
Along with it, the largest recipient countries of money transfers among developed ones
are: France, Germany, Spain, Belgium and South Korea, - to which these financial streams come
generally from the other developed countries. However, being powerful on the absolute value,
these means are insignificant for these countries in relation to the volume of the gross domestic
product (GDP), making from 0,4 to 0,8% of the GDP and only in Belgium more significant size
2,1% of GDP [6, p.93].
31
In developing countries, remittances sent by emigrants, on the contrary, are very essential
in comparison with the total amount of GDP [pic.2.5.]. The money transfers which are sent by
migrants to Tajikistan are equivalent to nearly a half of GDP, in Kyrgyzstan it is almost a third, in
Nepal and Moldova it is nearly a quarter.
Gambia 15,4%
Gonduras 15,7%
Salvador 16,5%
Cosovo 17%
Livan 17%
Liberia 20,4%
Armenia 21,4%
Moldova 24,5%
Nepal 24,7%
Kyzgyzstan 31,4%
Tajikistan 48,1%
0
10
15
20
25
30
35
40
45
50
Pic. 2.5. 12 countries with the greatest relative volume of remittances in 2012, % of GDP
of the respective countries [6, p.62]
Besides already listed countries - the former federal republics of the USSR, this group
aslo includes Armenia and Georgia [2.6.]. The volume of remittances to Armenia exceeds 20%
of GDP and to Georgia - 10% of GDP. The volume of money transfers to other former federal
republics of the USSR doesn't reach 5% of GDP.
32
Kazahstan 0,1%
Russia 0,3%
Belorussia 1,6%
Estonia 1,7%
Latvia 2,8%
Azeyrbadzhan 2,9%
Lithuania 3,6%
Ukraine 4,8%
Georgia 11,1%
Armenia 21,4%
Moldova 24,5%
Kyrgyzstan 31,4%
Tajikistan 48,1%
0
10
15
20
25
30
35
40
45
50
Pic. 2.6. Remittances to the former federal republics of the USSR in 2012, % of GDP of
the respective countries [6, p. 64]
* Turkmenistan, Uzbekistan - no data.
To put it in a nutshell, India, China and Mexico become undisputed leaders. Money
transfers to China and to India continued to accrue quickly. Growth remittances to Philippines
proceeded, but it was more moderate.
Ethnic structure.
Age and sexual structure.
Number.
Dynamics.
Each immigrant who arrived to the country (both legal and illegal) has a considerable
impact on all these parameters. Such countries as the USA and Canada were founded almost
completely thanks to the immigration. However, the history remembers some cruel oppositions
between early and late waves of the immigration. Its enough to remember about the USA in the
end of the 19th century. At that time so-called "indigenous" Americans who arrived to the
continent slightly earlier, clashed with the immigrants arriving to the USA from Ireland.
33
Practice showed that if the immigration is taken under control, each immigrant will be
able to bring benefit to the state. For example, as it was made in Germany and Israel, where there
are some effective programs of repatriation, and every migrant returns home regardless of
capacity and age.
It is difficult to overestimate the importance of immigration in such countries as Australia
and New Zealand. The governments of these countries constantly invite foreigners to immigrate
for the purpose of receiving residence permit and nationality, with the subsequent legal
employment. By itself, the government invites to immigrate so the called "white" immigrants,
who are going to work officially and constantly pay taxes.
It goes without saying that immigration has a lot of positive influence on host countries.
It is written much about the process of "brain drain", which for example, benefits for economy of
the USA. It is enough to tell that 40% of immigrants who came to the USA in the 80th are
doctors of science in the engineering field and computer disciplines. Also, 25% of technical
disciplines teachers in institutes are immigrants too. In the nineties more than 11 million
immigrants lived in the USA. By estimates, they earned $240 billion a year. Thus they paid
taxes of $90 billion a year.
Its clear that the return from immigrants is very high, even if we think only in the terms
of money. Let alone the
34
In a number of economically developed states and, first of all, in the European Union
countries, the migrants are quite often engaged in unskilled types of work on low-wages. To earn
the money these people do some not really prestigious jobs, they work like builders and general
workers, are engaged in service industry, public catering, public transport. So this helps to fill the
vacancies in some branches of the economy, that are not very prestigious.
Attraction of poorly educated, unskilled labor creates the opportunity for local population
to be engaged in a more intellectual work.
Here are more positive consequences for recipient countries:
Increasing the
competitiven
ess of
production
Increasing in
tax revenues
Improvement
of a
demographic
situation
Pic. 2.7. Positive consequences of labor migration for recipient countries [developed by the
author]
There are some negative consequences for recipient countries too:
It happens that mass inflow of foreign workers complicates unemployment rates, housing
problems and makes the general level of salaries lower. Due to that there is a discontent of
indigenous people and emergence of the social tension elements. Here comes the emergence of
discrimination in relation to foreigners and international hostility.
Recently, the illegal labor migration increases. The illegal immigrants are trying to
remain in the host country as much as it is possible, especially after their employment contracts
end. The worst part of is that sometimes they are involved in shadow economy, including traffic
in arms and drugs.
Illegal immigration is the worst factor in consideration about the costs and benefits the
country may have. Illegal migration doesnt have a good influence on the budget of any state.
35
This is why the public regularly demands to reconsider and toughen the immigration laws. The
foreigners who illegally crossed the border and who are informally employed, don't bear any
advantage to the country but on the contrary, bring notable losses.
From year to year the migrants are taking home loads of cash which they earned illegaly
in the host country. And these indicators are only growing, while the foreigners continue to
immigrate.
Its self-evident that phenomenon of illegal immigration needs to be considered more
carefully, while its important to know the reasons of it and the consequences it may bring to host
countries.
Moral and
cultural
environment
Unemployme
nt, lowering
level of
salaries
Illegal
immigration
Pic. 2.8. Negative consequences of labor migration for recipient countries [developed by
the author]
Illegal migration is a type migration that violates the migratory legislation of a country.
There are the following categories of illegal migrants:
-
the foreigners going to the country or being in its territory already without any
point depends on the legislation of the state, for example in Russia the child becomes a citizen if
36
at least one parent is Russian. If both parents are foreigners, their child can become Russian
citizen, but it will be refused in nationality of its parents home-country.
It is well known that the main factor of illegal immigration is the intention to live a better
life, to maintain ones family and to get away from the poverty. At the same time, there are some
migrants who attempt to avoid criminal liability (especially when using false identification
papers).
It is obvious that illegal immigration has negative consequences for host countries. First
of all, the migrants create an extremely low standard of labor relations with the employers who
are hiring them. Moreover, they violate some house rules because of the overpopulation of
occupied living spaces, as illegal immigrants are trying to save their money on rent. Because of
the fact that migrant workers are all the time far away from their families, trying to earn some
money, they destruct their families too.
Illegal migrants do not pay taxes, however they use medical services in public medical
institutions, their children attend public schools, thus the expenses of municipalities on law
enforcement increase.
The consequences of illegal immigration for host countries:
USA. It is a huge problem of illegal immigration in the USA. By official estimates there
are more than 13 million (informal it is about 40 million) illegal migrants in the country. There
are two categories of illegal immigrants there: first of all there are those migrants who arrived
legally, and then remained in the USA with expired visas, also there are those who crossed
country borders illegally. Most of the illegal migrants got to the USA through the southern
border with Mexico, so generally from the country of Mexico and other countries of Latin
America.
Australia. The number of legal migrants grows annually on 300 thousand people, while
the quantity of illegal migrants decreass by 9% annually.
Japan. Japan has a low level of legal immigration and there is almost no illegal
immigration there.
China. 8 million of people legally work in China, illegal migrants are generally from
Pakistan and India.
South Korea. 2 million migrants are working in the country, they are generally from
China and India.The amount of illegal migrants is about 3 000 000 people, and they are generally
from the Arab countries, China and Democratic People's Republic of Korea.
Europe. Migrants from Africa are the special problem for European continent. The
migrants from Africa are looking for a better life on the European continent, they pay a lot of
37
money for the transportation through the Mediterranean Sea, but however they dont always
reach the continent because it often happens that they sink or perish from exhaustion.
Switzerland. On September 24, 2006 at the referendum in Switzerland, two thirds of
inhabitants (which is about 70%) supported the decision of immigration restriction. So the laws
became a barrier to those who want to get a higher standart of living under the pretext of a
political asylum. At the same time, the accession to the Schengen agreement, which came into
force on January 1, 2007 can prevent the decision of Switzerland inhabitants and will create
certain opportunities for people interested to remain in the country [9, p.46].
It differs from when states are welcoming the experts from other countries. For example,
Australia and Canada have developed systems which facilitate the entrance of experts from
developing countries as immigrants. In order to entry into the USA, it is allowed to receive
temporary visas rather easily if they are requested by the local employer. As we can see illegal
immigrants don't bring any benefits to the host country, only losses. While legal imigrants are
welcomed and appreciated in the host country.
The international labor migration has positive and negative consequences for sending
countries too. The positive ones are:
Relative
balance of
domestic
labor market
Remittances
Knowlege
and abilities
acquisition
Pic. 2.9. Positive consequences of labor migration for sending countries [developed by the
author]
Remittances became an important factor of foreign currency inflow to the donor country.
For example, in Pakistan the remittances from labor migrants exceeded by $5 billion a year.
38
People's Republic of China carries out an organized labor emigration, earning on it more than $2
billion a year [15, p.83].
Negative consequences:
O
utfl ow of
Outflow
w
ork force
workforce
T he re is an
o utfl o w of
w ork fo rce a t
m ost w orkin g a ge , th u s a la rg e
p art w o rkfo rce
d istra cts from
n atio na l
p rod u ction an d
d oe sn 't
p articip ate in th e
crea tion of G D P
"B
ra in Drain"
D rain "
"Brain
T he g re ate r p art
o f w o rke rs w h o
p ositive ly p ro v e d
th e m se lve s in
fore ig n firm s,
d e cid e to sta y in
fore ig n cou n try
m ore or re m a in
th e re on
p e rm an e n t
resid en ce .
T hu s th e d on o r
cou n try lose s a
ce rta in p a rt o f
th e q ua lifie d
lab or.
M
ora l u
p se t fo
Moral
upset
forr
d
o n o r country
co un try
donor
p
op u lation
population
S u cc essfu lly
settle d m ig ra n ts
a ct like a m o ral
u p se t for a
ce rta in p art o f
th e p op u lation ,
w h ic h
rep re se n tative s
w ork on th e
h om e la n d w ith
th e sam e re tu rn
o f force s an d
p rofe ssio na l
k no w led g e , b u t
rece ive a low er
sala ry a n d le ss
o pp ortu n itie s to
g row an d to
b u ild up o n th e
succ e ss.
Pic. 2.10. Negative consequences of labor migration for sending countries [developed by
the author]
Despite the Convention on protection of migrant workers adopted by the ILO, the social
protection of the foreign workers leaves to wish a lot of the best. Small wonder that the amount
of money that migrants are paid is less than native people get, even if they do the same job as
quickly and qualitatively. Also, foreign workers are often considered as of little worth and so
they are the first ones that can be dismissed in case of crises and unemployment.
Another negative consequences that are possible for donor countries can be decrease
of qualification of hired migrant workers, while they are working like handymen abroad.
39
Labor migration represents the resettlement of able-bodied population from one state into
the other mainly caused by economic reasons and is divided into emigration (departure) and
immigration (entrance). Labor migration conducts to alignment of wage levels in various
countries.
As a result of migration the total volume of world production increases due to more
effective use of workforce and its intercountry redistribution. Another positive economic effect
which is caused by migration is the growth of migrants income, money transfers home
(remittances), which resulting the decrease in costs of production in these countries getting
money transfers.
The developed countries are considered as the main direction for immigration, and
developing ones are the emigration source.
State regulation of international labor market is carried out on the basis of the national
legislation of the host countries and the countries exporting workforce, also on the basis of
interstate agreements between them. This regulation is carried out through adoption of certain
programs
40
The main reason for this research was a need to understand and distinguish the costs and
benefits of international labor migration. Certain analyses concerning the main reasons and
consequences of migration as for the accepting and sending countries were carried out.
So as it was shown above, the international labor migration arises because of a certain
contrast in levels of economic and social development of the states. At the same time, the world
practice shows that labor migration provides undoubted advantages to the countries both
importing workforce, and exporting it. But thus arise certain social and economic issues.
Nowadays there are a lot of positive consequences of labor migration like reduction of
unemployment , remittances from emigrants which is a huge benefit for donor countries, while it
is an additional source of the currency income, and also migrants get knowledge and experience
after working in a foreign country. As a rule, when migrants are coming home, they invest earned
money into own business, thus creating additional workplaces.
Among the negative consequences of labor migration it is necessary to remember about
the desire to hide the gained income, the phenomenon of "brain drain", and sometimes even th
edecrease of working migrants qualification.
Also, one of the features characterizing a modern stage of migratory processes consists in
significant increase of illegal migration. Many countries regulate the inflow of foreign labor in a
legislative way, so far the illegal penetration through the borders strongly increased. Thus,
illegality of labor migration became a world problem. The other aspect of this problem consists
in the fact that the illegal workers represent the cheapest workforce.
So, labor migration is an integral attribute of modern labor market. Also, labor migration
positively affects many aspects of the economy like softening the problems of employment and
creating additional workplaces, increasing productivity and efficiency of work.
In turn, the import country faces the deterioration of demographic situation, deficiency of
professional labor and the growth of inflation because of workforce outflow. However, the
decrease of unemployment and investments into the donor country economy will promote the
improvement of economic indicators. The convergence of compensation levels in the donor
countries and the recipient countries can reconcile these ambiguous consequences of labor
migration. Similar levels of salaries smooth and harmonize the costs and benefits of labor
migration, gradually leveling economic development of the countries.
41
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