In many countries, foreign labor is an important part of the economy. Using migrant labor can contribute to the development of a country, but it can also cause economic problems. What are some of the advantages and drawbacks of expatriate labor for a country’s economy?
The development of countries such as Singapore, Brunei, the Gulf countries, and even the US has been helped greatly by millions of foreign workers. While foreign workers are cheap and quick, they can also cause problems for the economy of the country. In this essay I will look at some of the problems caused by an expatriate workforce and suggest that we need a balanced approach to employing foreign workers.
There are many obvious advantages to using foreign labor. First of all, they are usually cheap. Workers from Bangladesh, India or the Philippines are happy to work for salaries which are high in comparison to their home countries but low in the host country. Foreign workers are also ready to work in remote places or at times when local workers would not. A second point is that foreign workers are usually job-ready. They do not need expensive college education or training. They may have skills not available in the new country. A third point is that many migrant workers are ready to work in jobs that are too dirty or dangerous for nationals such as construction or cleaning. All these advantages mean that the economy is boosted by cheap labor and low production costs.
However, there are hidden costs to the economy of the country. One major drawback is that the workers are sending a lot of money home, instead of spending it. This results in a loss of foreign exchange for the country. Another point is that they may take jobs from locals. More importantly, they reduce the salaries for some jobs. For example, employers will pay very low salaries for some jobs which some locals might like to do but could not survive on. Security is another issue. Foreign workers can leave at any time if there is a political or other problem, and this can mean a sudden loss of skills and experience. An additional point is that the influx of foreign workers can put pressure on services such as hospitals or housing, and these costs have to be paid by the state, not the employers who are getting rich. All these factors can result in economic problems for the government.
In conclusion it’s important to have some control over the use of foreign workers, and to make sure that using them does not disrupt the labor market for local workers. One way is to pay them higher salaries and give them full protection. Countries should seek to employ their own citizens first before turning outside and depending on foreign labor.