The new global talent race

In Blog by Jack Graham0 Comments

With Trump’s America and Brexit Britain turning away talented migrants, Canada and Australia are well placed to capitalise

By Jack Graham

From tech gurus to top scientists, every country says it wants to attract the best brains. Highly-skilled workers are increasingly mobile, and help to stimulate innovation, enterprise, jobs and growth.

But while the global competition for talent is nothing new, the contest has recently changed. Two of the leading magnets for talent – Britain and the United States – now seem intent on repelling people.

Britain has become increasingly hostile to foreign workers. The Brexit vote and the UK government’s hard-line approach towards immigration – with Prime Minister Theresa May slighting “citizens of the world” as “citizens of nowhere” – have put off thousands of foreigners. The UK is still refusing to guarantee the full rights of three million EU citizens, leading many to consider their futures elsewhere. Meanwhile, following the embarrassment of the Windrush scandal, it now transpires that at least 1,000 highly-skilled migrants are wrongly facing deportation. So much for “Global Britain”.

Across the Atlantic, President Trump’s nativist rhetoric is translating into policy, from Muslim travel bans to a crackdown on undocumented immigrants. With its “Buy American, Hire American” stance, his administration is making it much harder for skilled foreign workers to move to the US. And it is preparing to shorten the length of the visas it issues to Chinese nationals, particularly those involved in science, technology, engineering, and mathematics.

More open-minded countries, notably Canada and Australia, spy an opportunity. After years of losing some of their best brains to the US and the UK, they now hope to steal a march in the global race for talent. Canada, in particular, is making it as easy as possible for skilled migrants to make the jump.

‘Brain drain’

The global race for talent matters more than most to Britain. In 2010, one in six highly skilled Brits aged over 25 were working abroad. In contrast, only 5.9% of Canadians, 3.8% of Australians and 0.5% of Americans with high skills had emigrated.

Fortunately, the UK has benefited from a steady inward stream of from the EU – think French bankers, German doctors and Estonian tech entrepreneurs – as well as from the rest of the world, such as Indian IT workers.

But since the Brexit vote, immigration from the EU has plummeted; three in four European academics say they’re now more likely to leave the country.

That leaves businesses desperate to recruit skilled migrants from outside the EU. But the government’s absurd quota system for non-EU migrants is thwarting them. Because the arbitrary monthly cap had been hit, the minimum salary needed to qualify for a skilled work visa was a staggering £55,000 (€62,600; $73,500) among last December’s applications, up from £30,000 previously. More than 2,300 visa applications from doctors and nearly 2,000 from IT professionals for UK work visas have been rejected in recent months.

High-skill visa policies also matter to the US – a country that has always built its economic success on immigration.

The Trump effect is already noticeable. H1-B visas, which allow employers to obtain skilled workers from abroad, are under attack. The US Citizen and Immigration Services have been piling extra requirements on to an already bureaucratic process, demanding detailed statements of foreign employees’ duties, and why employers have had to hire from abroad. Trump also wants to slash the annual number of H-1B visas from an already paltry 85,000. His idea of blocking extensions to H-1B visas may even result in up to 750,000 Indian visa holders being forced out of the US.

Clamping down has a cost. Even the pre-existing caps on high-skill migration to America have been damaging. In the 2007-08 H-1B visa lottery, for example, around 178,000 visa applications were rejected in computing-related fields. According to one study, this caused American cities to miss out on creating over 230,000 new tech jobs.

Taking full advantage

Considering the situations in Britain and the US, it’s not surprising that foreign workers are staying home or going elsewhere – by preference or practical necessity.

Canada is doing its best to capitalise. Immigration minister Ahmed Hussen (pictured left, with Canadian prime minister Justin Trudeau), himself once a refugee from Somalia, has spoken of his government’s priority to “win in the global race for talent.” And he is backing up those words with policies.

In its 2018-20 immigration plan, Canada is planning to welcome a quarter of a million skilled workers in three years through its Express Entry system. For top talent it is piloting a new global skills visa programme, to allow firms to bring in international workers within two weeks, instead of the many months such processes usually take.

High-growth companies can benefit from the two-week visa programme, as can global companies investing in or relocating to Canada. With the US turning down thousands of tech workers, the country wants its booming tech ecosystems in Toronto and Vancouver to become new Silicon Valleys.

Australia is also seeking to attract in-demand science, technology, engineering and mathematics (STEM) workers. The government is planning a new visa category for high-skilled people earning A$180,000 (£102,000; €117,000; $165,000) or more, along with visas for start-up companies seeking workers in STEM fields such as agricultural technology. Wisely, when the pilot begins on 1st July there will be no overall cap on high-skilled workers, though businesses are only allowed to hire a certain number.

However, this progress may be undermined by the recent scrapping of the 457 visa, which was brought in two decades ago to help Australian employers sponsor skilled workers. In March it was replaced by the new Temporary Skill Shortage (TSS) visa with tighter requirements – to “put Australians first”, as Prime Minister Malcolm Turnbull put it, regrettably.

It pays to be open

Openness to talented and hard-working people is more important than ever in a global economy where skills are at a premium. Along with Canada and Australia, China and other fast-growing emerging economies are also joining the global talent race. Britain and America have taken a wrong turn; they urgently need to correct their course.

 

Jack Graham is a fellow at OPEN.