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Could we leverage off our international relations to lower unemployment statistics? Thoriso Maloka investigates…

The daily reads of issues in society, particularly those that are then pregnant with other pressing issues, are the bane of all existence. Take unemployment as an ideal example of such exponential issues and maybe, we double click on this crisis for the purpose of this write up. Countries such as South Africa are seated at alarming and community decaying percentages of unemployment. It is excruciating to experience a society where the average age is just south of 25 years old, but unable to borrow from the natural productivity and energy that comes with that. Thankfully (let us ride with optimism) and at a global level, all these societal issues have been grouped into actionable strategic initiatives. In this instance, I refer to Sustainable Development Goals and the supporting policies and trade agreements thereof. With little proof that the annual key performance indicators are ever met, it then drives questions such as, “What else can innovatively be done? Which options are we not exploring to their maximum potential?”

In the case of countries who form part of international community agreements and discourse, it is safe to assume that there should be exchange of ideas and resource allocated to solutioning. As part of initiatives geared towards creating decent work and economic growth, are we able to propose exchange of talent/skill without provoking brain drain? Essentially, this being the pest of any of society that consists of highly skilled and qualified workforce, however, unable to create an overall desirable environment for said force. Research and lived realities suggest that talented and skilled people are and have been immigrating for various reasons, including the inability of their home country to create job opportunities, attractive immigration policies, perceived political stability, and, I suppose, better living conditions as per individual desires.

This then echoes the earlier question, is it worthwhile toying around with the idea of International Labour Mobility Agreements to reduce unemployment and bolster economic growth? Labour Mobility Agreements and Schemes are designed to extend employment opportunities outside of the immediate environment of the applicant/workforce. Locally, we would see people move between cities and provinces and internationally, this would be a case of moving from one country to another for job opportunities. Depending on the need and offering of each state, these agreements are structured between two (Bilateral) or more (Multilateral) governments. The objectives and mutual benefits would be stipulated, inclusive of fair trade, conducive work environment, and other clear parameters. Typically, for a receiving country, this would introduce a diverse and needed sets of skills, intercultural benefits and diversity, and perhaps fostering entrepreneurship; all which are of benefit to the operating environment. For the country providing the workforce, this would lessen the strain of unemployment and present a host of other economic benefits I will discuss in detail later in the article.

Who has had such agreements in place? Members of the African Union are of full familiarity with these sorts of arrangements, thus not making this an uncomfortable suggestion. In fact, parallel to the Africa Free Trade Agreement (AFTA), which has been established with strategic objectives such as poverty alleviation, economic growth, ambitions of improved product quality, and bringing home, finally, efficient and accessible trade between African countries; there has been whispers of Free Movement of Persons (AU-FMP), allowing professionals, academics, business persons, and others identifiable under this arrangement to move between countries within the continent, in transaction of their skill. I refer to these as ‘whispers’, not because the discussions and proposed policies have not been formalised, but rather having met reluctant reception. In the context of our continent, it is completely understood that there would be resistance to AU-FMP suggestions. Take South Africa as a case study. We have a known immigration law implementation crisis, where it can be argued that our systems and registries are not always in position to confirm the identity of nationals and residents. This serving as an example of trust issues between member states, prohibiting the possibility of productive discourse considering labour mobility within the continent.

Perhaps then, let’s voyage past the horn and harbours of Africa and ideate around labour mobility agreements outside of the continent. South Africans have been immigrating to other countries for years now, for both temporary and permanent employment. By way of observation, the following countries are example of countries that enjoy South African skillsets and have offered different conditions for said residents:

United Kingdom and United States of America

The UK and USA all the way to historic days have seen many South Africans settle into cities such as London, New York, and others. The reasons behind the choice of this location will vary between historically seeking political asylum and more recently work opportunities and different scenery. We have seen a notable number of chartered accountants, for example, take on opportunities in the UK and USA.

Australia and New Zealand

Home is home, a sentiment strongly expressed by South African expats living in other countries. The point of departure for this sentiment is often centered from the natural luxury of our climate and surroundings. This making Australia and New Zealand notable destinations.

Canada

With a significant South African community, Canada presents continuous attraction for South Africans in certain industries, including healthcare, logistics, and, more recently, technology.

United Arab Emirates

A personal favourite of mine, due to its proximity and ease of travel, time zone, tax benefits, attainable visa requirements, and a country with heightened ambition offering a “fresh start” for many South Africans. According to Holborn, Dubai alone hosts about 50 000 South Africans, practising across numerous industries. From my experience in this geography, one can build an entire ecosystem of service providers offered by South Africans; from your landlord to family doctor and specialists, therapists of varying nature, grocery stores, and even churches.

The countries stated are some of the most common, but not limited to some innovative invites that have happened pre- and post-COVID-19—countries with a declining youth population inviting a skilled workforce. Additionally, countries such as Indonesia having created digital nomad visas, allowing mainly young professionals to work from anywhere in the world.

I would imagine some form of benefit to having these already existing movements formalised, by way of international trade agreements. As such, Labour Mobility Schemes as opposed to brain drain would present some notable differences to countries with high unemployment statistics. As alluded to earlier, the reduction of unemployment by offering cross border opportunities for countries burdened with domestic unemployment. Secondary, provision of skills in shortage to countries with low unemployment and high opportunity rates in specific industries. Would we see an increasing number of people leaving the country? Yes, but a targeted population from the currently unemployed and battling to secure opportunities. This would be empowered by agreements, fostering international relations, while delivering mutual benefit. It is also not to suggest that there aren’t existing bilateral and multilateral exchange programmes that already highlight the importance of leveraging off the benefits of being part and parcel of an international community. The ideation really suggests increasing the existing movement by deriving additional trade agreement (specifically labour from some of the cohorts in which we are member states).

Without insinuating careful assessment of its contribution to economic growth, one would immediately want to encourage discourse and thought on detailed benefits such inflows of personal remittances from expats living in other countries. By remittances, I refer to the money sent by South Africans living in other countries back into our shores. These are important transactions and inflows that contribute towards household income, poverty reduction, and sit well alongside Foreign Direct Investments and Official Development Assistance. For some very practical examples of domestic consumption of remittances, consider a family that spends the money received on local goods and services. The funds allocated towards investment in real estate, local savings, investment accounts, and those directed towards the development and growth of small businesses. In 2022, the Work Bank data reflected a 0.2% inflow into our GDP having been received from personal remittances. I am not one to speak numbers without guidance and supervision, but the theater of the mind has me believing the increment of that figure would be of significant assistance.

Remittances are just one of the most accessible examples at an individual level, there are other hosts of financial benefits that could be derived. Those could be discussed in detail in a separate discussion.

The solutioning towards meeting SDG targets, particularly those attached to solutioning for high unemployment statistics, will probably not be solved by one method. These like any other business problem, require experimenting with some non-conventional methodologies over time. Perhaps not a feasible plug and play for South Africa, but there are case studies in the global market that have shown proven success of Labour Mobility Agreements. These have delivered results that (1) Lessened the strain on the talent providing country while providing economic growth and (2) Solutioning for skill shortage in receiving countries, while enhancing the relationships amongst the global investment community.

Thoriso Maloka is a consultant and business developer who is passionate about helping clients unlock growth opportunities and achieve their strategic goals.