'Give me your tired, your poor, your huddled masses yearning to breathe free, the wretched refuse of your teeming shore.'
Attracting human capital with a stake in the nation
'Give me your tired, your poor, your huddled masses yearning to breathe free, the wretched refuse of your teeming shore. Send these, the homeless, tempest-tossed to me," reads the storied inscription below the Statue of Liberty in New York Harbour. There was a time in the history of the global economy when arriving workers did not come with a return address. And the US, then a young country with lots of land it was eager to seize from its original inhabitants, was willing to reward those willing to risk it all in America. They were given the right to work, to raise children, to settle and eventually to become citizens.
Except, of course, those who arrived as slaves. They, too, were eventually freed and much, much later, guaranteed equal rights. America's immigration policies have always been better in theory than in practice, chequered with abuses and inconsistencies. The point is that immigration in the US has always been generally accepted as a crucial source of new labour, money, and most importantly, talent. The vitality of a nation's culture and economy is directly proportional to how many people move there every year.
People flee hardship and pursue opportunity, whether they do so in leaky boats, on foot across deserts or in the comfort of a business-class cabin. Thus have North America and Europe long been targets for anyone hoping for a better life, and they in turn have profited from this constant infusion of energy. In recent years, new magnets of economic opportunity have formed, recognisable by their growing expatriate populations: Tokyo, Singapore and Dubai.
But the contract has changed. Immigrant talent nowadays is expected to come for a few years and then disappear back to whence it came. While this is for many wealthier expatriates a desirable trade-off - no strings! - it discourages many from putting down roots and becoming enduring parts of the local social fabric. That is why a report that Dubai's Executive Council is considering a proposal to raise foreign ownership limits on companies in the emirate and even allow wholly owned foreign companies in certain strategic industries is an encouraging development. The Executive Council is also reportedly considering legal amendments that would enable foreigners to set up 100 per cent-owned businesses. At the moment, they can only do so within free zones.
Not just anyone could set up any kind of business: the recommendations reportedly under consideration would grant business licences on a case-by-case basis to those investing considerable amounts to establish hi-tech businesses deemed to be of strategic interest to Dubai's economic development. If adopted, such reforms would put Dubai - and potentially the rest of the UAE - among a list of countries such as the US, Australia and Singapore that have become magnets for talent, that can appeal directly to the world's professionals and entrepreneurs without having to depend on local companies to offer them jobs. Instead, they can advertise their own merits - things such as infrastructure, educational systems and standards of living.
The UAE is still at a disadvantage in this regard. Yes, we have no taxes, but getting here requires finding an employer in advance. Lose your job for any reason and it's time to pack your bags. Changing jobs requires a certificate of no-objection from one's previous sponsor, and setting up a company requires a local partner. How to promote immigration without being inundated by foreigners who steal jobs from the locals and dilute the culture is always going to be a sensitive issue, particularly here in the UAE, where four of every five people are already from overseas.
But the same sensitivity was true in Singapore, an immigrant society whose citizens also saw foreign talent as competition. Faced with low birth rates among its people and a stagnant skills base, however, the government decided that attracting talent was better than keeping it out to protect jobs. A vibrant, open economy, it determined, creates more jobs than foreigners coming in take. So Singapore began actively promoting immigration, even setting up offices overseas to promote Singapore to white-collar expatriates.
Not just anyone is given a visa; Singapore does not offer the same kind of invitation to blue-collar workers, the maids or construction workers who do the jobs Singaporeans are no longer willing to do. But it recognises a growing reality of the new global economy. Singapore instead gives priority to those with high education levels, desirable skills and, of course, money. Singapore then grants some foreigners "permanent residency".
The advantage is that Singapore can attract talented expatriates based on its lifestyle, safety and infrastructure, and who in turn want to become part of its social and business fabric, not just transient, passive participants. Ultimately, global labour will need to become as mobile and as fluid as global capital and global commerce have become. Talent, like capital, will aggregate where it earns the highest returns.
Those nations that hope to attract the best human capital will need to understand that foreign workers would like not only a pay cheque, but also a stake in the venture. email@example.com