Abstract
Since the 1990s, technological innovation and economic globalization have expanded the role of knowledge and technology in economic growth, thereby increasing the demand for highly-skilled workers. Many OECD countries are competing for such global talent as highly-educated foreign students, innovative entrepreneurs and IT engineers, and are increasingly turning to skill-based selective migration policies. Shin and Choi’s book on South Korea and D’Costa’s work on Japan are two very complimentary and supportive recent volumes on the subject. Their novelty is their focus on Asia – a welcome departure from existing studies, which are mostly concerned with the USA and Western Europe. As a result, they fill an important scholarly void and do justice to the fact that Asia is indeed becoming the growth centre of the world economy. The authors also underscore the fact that some of the East Asian economies, unlike the successful cases of Silicon Valley in the USA and developments in other English-speaking settler countries such as Canada and Australia operating under the jus soli principle, have been countries of emigration rather than immigration and are now transformed into destination countries through the maintenance of the jus sanguinis principle. These two books in their different ways focus on the very timely topic of the migration of skilled workers and professionals to non-English-speaking and non-settler countries such as Korea and Japan, and open new horizons for scholarly inquiry and policy debates.
Both Japan and Korea have rapidly generated a dynamic industrial capitalism. Both face a ticking time bomb of population decline, and both share a structural shift from the manufacturing to the service sector, changing forms of employment, slow economic growth, and a shrinking workforce. Both countries have introduced policies to promote skilled migration: Korea started the ‘Gold Card System’ in 2000 and Japan introduced the ‘Points System’ in 2012 to attract foreign professionals. However, despite these policies, the two countries lag behind not only their OECD counterparts, but also their Asian peers in IMD’s World Talent Ranking (2017) (IMD World Competitiveness Center, 2017), which records Hong Kong in 12th place, Singapore in 13th, and Taiwan in 23rd, ahead of Japan in 31st and Korea in 39th.
Shin and Choi argue that Korea’s economic miracle, with high social development and hallyu (the Korean wave of cultural exports), has attracted the young Asian generation. But the shift towards a ‘knowledge-based economy’, demanding profitable advanced products and services development, has not materialized. Korea’s accomplishments in tertiary education have been insufficient to compensate for the declining birth rate and it is unable to adequately meet shortages of highly-skilled professionals in business services and software engineering, which are clearly becoming key sectors for future economic growth.
Shin and Choi propose a familiar model to understand skilled labour migration not just in terms of human capital, but also as social capital (Chapter 1). They perceive that social capital arises from global talent, which would create transnational links between foreign countries and Korea. Such ties would foster brain circulation and the localization of Korean products and services. They examine four groups that could be part of global links, differentiated according to ethnic origin and embeddedness in Korea. These are foreign students in Korea (Chapter 2), Korean students who are studying abroad (Chapter 3), the Korean diaspora or ethnic Koreans abroad (Chapter 4), and ‘pure’ foreigners such as Indian IT engineers who neither share ethnicity nor embeddedness in Korea (Chapter 5). Based on rich empirical data, the authors provide detailed analysis of the possibility and plausibility of these groups becoming global talent for expanding innovation and helping Korean products and services to fit markets abroad
Despite such expectations, the authors, based on their interviews with students both Korean and foreign, alert us to the problem of ethno-centric nationalism, racism and xenophobia in Korea. By excluding and discriminating foreigners, Korea cannot be perceived as an attractive place to work. The authors propose a middle ground, arguing that global talent need not be fully assimilated into Korean society, but at minimum ought to acquire a certain degree of social embedding so as to maintain connections with Korea even after leaving the country.
D’Costa’s book, premised on similar predicaments of demographic transition and a shortage of skilled professionals, approaches the subject differently. He theorizes the state of play in contemporary global capitalism and positions the importance of labour (skilled and unskilled) in the capital accumulation process. The shift towards services is a response to capitalist crisis in the key manufacturing centres and it is within this shift that the international movement of technical professionals is situated. Analytically, he begins with the USA and Japan and then empirically introduces India, a country that is also witnessing a services transition, but prematurely – through what D’Costa calls ‘compressed capitalism’ (pp. 14–29, 90–117), whereby tertiary technical education is well-developed in an impoverished India to serve the global services market.
Given that India is a major exporter of technical professionals and Japan is the second largest IT market, D’Costa poses two interrelated questions. First, why is Japan slow in accepting foreign professionals despite labour shortages? Second, why did India become a major exporter of technical professionals despite its low level of economic development? By theorizing the changing structure of capital accumulation in the two largest IT markets, the USA and Japan, he links the mobility of the highly-skilled in the world economy (Chapters 2, 3 and 4). In Chapter 5 he demonstrates, through a political economy analysis of higher education in India, why it is a major sending country. The inequality prevalent in India, with segmented labour markets, systemically produces the demand for higher education, making the country a major exporter of technical professionals. In the following chapters (Chapters 6, 7 and 8), he examines the Japanese IT industry and its institutional stickiness. The ‘closed’ nature of institutions under the vertical keiretsu system, linking companies and banks within groups, excludes those who are outside the system. Moreover, the insular nature of Japanese business practices, exacerbated by the natural barriers of language and culture, also hinder Indian IT experts and firms from fully exercising their potential in Japan. As a result, while Indian IT professionals are traversing other parts of the world, they remain limited in penetrating the Japanese market. D’Costa effectively demonstrates that, even though the production and accumulation of economic surplus is imperative, the logic of capitalism does not appear to undo Japan’s institutional stickiness.
While Shin and Choi’s study focuses largely on the supply side of global talent rather than on the demand side of the labour market, D’Costa’s work analyses the structural change in the capital accumulation process at the global level, and relates sending and receiving countries through the lens of global technical talent. The two books not only represent the state-of-the-art analysis of competition for global talent and the limitations of East Asian migration policies, but also epitomize the growing tension between the demand of capitalism to meet labour shortages and the political–social idea of nationhood based on ethno-nationalism. This tension indicates that the market and state are not neutral entities, but are deeply embedded within society, and that the logic of capitalism does not operate in the same manner everywhere. The closed nature of a society discourages foreign skilled people from working and settling there. Moreover, as D’Costa indicates in the case of Japan (pp. 119–127), Japanese women could partly fill such shortages, but social discrimination in the workplace makes their participation difficult. The Global Gender Gap Report ranks Korea at 118th and Japan at 114th among 144 countries (World Economic Forum, 2017). Apparently, aside from the hierarchical workplace, gender discrimination in the labour market makes both Korea and Japan unattractive places to work for local highly-skilled female workers.
Both books acknowledge that Korea and Japan are adjusting to the realities of labour shortages, particularly in technology sectors but also in the 3D occupations. Consequently, immigrant populations are not only growing but are settling down to form families and communities, while host governments are crafting policies for foreigners. Korea has initiated several policy measures to promote integration and multiculturalism. While Japan’s conservative government does not acknowledge ‘immigrants’ and their contributions, it has been receptive over time of Indian professionals and their communities, including facilitating the establishment of Indian schools in Japan. Since family reunion, education and health, social security and tax systems, and community support contribute to the well-being of migrants and their willingness to stay, governments must go beyond visa and permanent residency policies, and consider social inclusion.
Both books imply that the future of East Asian economic growth will be affected by the ways in which global talent is mobilized, given that other measures are not being pursued seriously. D’Costa argues and provides ample recent evidence that Japan’s institutional stickiness will loosen as the country faces demographic and economic crises. While I partly agree with this prognosis, what should be noted is the lack of political will for change under growing nationalism and securitization in Japan. If the two countries want to bolster further economic growth, they must embrace a broad version of diversity that includes not just foreign professionals, but also local women and other minorities. Policymakers as well as businesses reliant on highly-skilled professionals in both countries should find the analyses in these books useful in thinking through what kind of changes are necessary to foster a safe and satisfactory working environment for all workers, irrespective of socio-economic background. Scholars working on contemporary changes in the world economy and the place of labour will find these works of immense value.