Facing the global jobs crisis: Migrant workers, a population at risk

The global economic crisis is posing new challenges for the world’s 100 million migrant workers. They may face reduced employment and migration opportunities, worsening living and working conditions and increasing xenophobia. Although no massive return of migrant workers has been observed so far, the crisis is having repercussions on their earnings and the remittances they send home. Ibrahim Awad, Director of the International Migration Programme at the International Labour Office, published a new study entitled “The global economic crisis and migrant workers: Impact and response”. Interview with ILO Online.

ILO Online: How does the impact of the crisis on migration vary across countries and sectors?

Mr. Awad: Depending on countries of destination, migrant workers are present in such sectors as construction, manufacturing, hotels and restaurants, health care, education, domestic service and agriculture. Some of these sectors – construction, manufacturing and hotels and restaurants – have been seriously affected by the crisis with migrant workers experiencing the major shocks. In the United States, Ireland, and Spain, migrant workers in construction were particularly affected. In Malaysia, Japan, and the Republic of Korea, the impact is in manufacturing which has the largest job losses.

In contrast, other sectors (e.g., health care, domestic service, and education), in some countries, have seen employment growth. In the United States and Ireland, jobs in health care and education have

ILO Online: Does the crisis have an impact on labour migration flows?

Mr. Awad: Contraction of the economy and rising unemployment may prompt destination countries to introduce more restrictive labour migration policies. Origin countries, which often heavily depend upon the remittances from migrant workers, respond to the impact of the crisis by exploring new labour markets and introducing reintegration and employment packages. To date, no mass returns of migrant workers have been observed, but new outflows from some countries of origin have slowed down. For example, in Mexico, the net outflow dropped by over 50 per cent between August 2007 and August 2008 (Note 1). Potential migrants, considering the high costs of migrating and reduced employment opportunities in the destination, have chosen to stay home.

At the same time, the number of returning migrant workers in 2008 remained similar to the previous two years. Voluntary return programmes implemented by destination countries have fallen far short of the targeted numbers. Migrant workers often choose to remain despite deteriorating labour market conditions in order to preserve social security benefits. The adverse economic and employment situation in the origin country also discourages them from returning home.

ILO Online: Before the crisis, remittances were growing in all developing countries. Has the crisis reversed this trend?

Mr. Awad: The rates of growth of remittances has declined, and in some areas so has absolute volume. A number of countries in Latin America, sub-Saharan Africa and especially Central Asia have been seriously affected. Thus poverty reduction and the sustainability of economic activity and employment in some countries are at risk. However, in some countries, such as Egypt and Pakistan, during certain periods since the crisis broke out, remittances have increased despite the economic downturn, suggesting they acted as countercyclical measures (i.e. rising when the economy is weakening, and falling when the economy is strengthening).

Remittances are the most visible and tangible benefits of labour migration. At the macro level they bring in foreign exchange and contribute to correcting balances on current accounts in countries of origin. In many countries, remittances represent a high proportion of GDP. Through their direct and multiplier effects, they sustain demand and thus stimulate economic activity. Employment is generated as a result. At the household level, remittances can contribute to poverty reduction and human capital development through expenditures on education and health care.

ILO Online: How does the crisis affect migrant workers specifically?

Mr. Awad: In times of crisis, slack demand for labour increases the likelihood of precarious and irregular employment. Perceived or actual competition for scarce jobs spurs xenophobic and discriminatory reactions of nationals against migrant workers and their families. While little evidence exists, it is likely that migrant workers will be forced to take on jobs in poor working conditions and/or in the informal economy. Certain groups and individuals may demand more protectionist measures or show aggressiveness towards migrants. Examples of such reactions exist in different regions. However, it is important to emphasize that violence and xenophobia against migrant workers are far from widespread.

ILO Online: Some countries of origin and destination have started to adopt policies to deal with the consequences of the crisis. Do these policies have an impact on migrant workers and labour migration?

Mr. Awad: Policies encouraging voluntary return put in place by some countries of destination have not realized their objectives up to now. A response to the crisis that only takes into account the decline in overall demand for labour, without regard to differential sectoral demands may end up generating irregular migration. It is still too early to assess the impact of more restrictive admission measures on the operation of labour markets and on the migration status of foreign workers. The employment situations in countries of origin and the remittances they receive will have to be monitored to examine the effectiveness of their adopted policy measures. This also applies to the protection of the rights of migrant workers.

ILO Online: What does the ILO recommend to reinforce the protection and recognition of the crucial role of migrant workers?

Mr. Awad: Migrant workers have participated in promoting economic growth and prosperity and the creation of wealth in countries of destination, while contributing to poverty reduction and development in their countries of origin. The future may harbour more adverse consequences for migrant workers than observed to date, if the crisis becomes drawn out.
It is therefore important to adopt appropriate policy measures to maximize their contributions to both countries of origin and destination. For instance, economic stimulus packages put in place by countries of destination should equally and without discrimination benefit regular migrant workers. This would ensure the most efficient operation of labour markets and the best utilization of available labour.

Using relevant international labour standards (Note 2), social partners can work together in countries of origin and destination to improve labour migration policies that can respond to the crisis or capitalize on the opportunities ushered by it. The ILO Multilateral Framework on Labour Migration sets forth principles and provides guidelines that can be of great value in elaborating these policies.

Note 1 : According to the National Statistics, Geography and Information Institute

Note 2 : The ILO Conventions on migrant workers – Migration for Employment No. 97, (1949), the Migrant Workers (Supplementary Provisions) Convention No. 143, (1975) and the 1990 International Convention on the Protection of the Rights of All Migrant Workers and Members of their Families, are the three conventions which define together a comprehensive charter of migrant rights and provide a legal basis for national policy and practice on migrant workers.