Catalog

Asian Workers on the Move

Introduction

Asian workers are on the move. Not only do millions of Asians leave home in search of better economic conditions and opportunities in other regions of the world, there is now burgeoning international migration within Asia. Increasingly, Asia's high-performing economies are drawing on migrants to meet demands along the whole spectrum of skills. Labor migration has been an important safety valve in those countries where new jobs have failed to keep pace with labor force growth.

Across the region, labor migration issues are now taking on added significance. Receiving countries are concerned that immigrants should have relevant skills, that they comply with immigration and labor regulations, and that flows are regulated to meet domestic needs. Sending countries' concerns revolve around the regulation of outflows, the rights of their workers abroad, brain drain of skilled labor, and the impact and level of remittance income. (Migration also raises vexed social issues, but the interest in this chapter is squarely on its economic dimensions.)

At a macroeconomic level, the arguments for free labor mobility across countries parallel exactly those that apply within a country. By directing scarce labor resources to their highest value uses, migration generates benefits, improving global resource allocation. The presence of significant wage differences for the same type of qualified workers in developing and industrial countries—by a factor of 10 or more as against the price differences for goods and capital that rarely exceed 2:1—suggests that the gains from increased international labor mobility would be enormous (Rodrik 2002). As home to more than half the world's population, developing Asia has the potential to reap big gains from easier migration.

Gains will not materialize automatically: many frictions retard labor movement and obstruct opportunities. Regulations and policies are still quite restrictive in most countries and are certainly much less liberal than those governing the movement of goods or capital. Labor-abundant countries are certainly losers, but labor-receiving countries that impose onerous requirements on migrants may also be missing out.

What then are feasible options for promoting greater labor mobility and are there gains to a regional—that is, developing Asian—approach? This chapter shows that in a context where the rich countries of the world are unlikely to significantly liberalize their immigration policies, Asian countries could reap important gains by working together.

In the section, Migration trends and directions, evolving patterns of international migration in Asia are reviewed. Reported migration data, which likely understate the true extent of movement, show rising flows within Asia. The underlying forces driving international movement of workers are examined in more detail in the following section, Asia's labor migration dynamics. These include divergences in opportunities and demography as well as Asia's rapid structural transformation. Revisions to immigration policies and laws have also had an influence.

The penultimate section, Migration: A win-win proposition, explores the potential of expanded intraregional labor migration flows in Asia. It sets out the major parameters of immigration policies in the region and the changes in policies that have occurred in the past decade. Liberalization has been slow, and migration policies have often had as much to do with sociopolitical as economic considerations. By quantifying the potential benefits of a more liberal posture toward labor movement, it shows the gains that could accrue if higher-income Asian countries liberalized their migration regimes.

The Conclusions suggest that cooperative regional arrangements that promote labor mobility merit serious consideration. It observes that the European Union has steadily moved toward greater intracommunity mobility of workers, and that Asia could benefit by following a similar path.