The GCM and temporary labor migration

Migrant worker programs

Circular or temporary foreign worker programs (TFWPs), sometimes known as guest worker programs, aim to add workers temporarily to the labor force without adding settlers to the population. The terminology, temporary foreign worker or guest worker, emphasizes the rotation principle at the heart of TFWPs: migrants are expected to work in another country from several months to several years before returning to their countries of origin. If employer demand for migrants persists, there may be replacement migrants, but the ratio of employed to total migrants should be near 100%.

Most of the world’s 3.6 billion workers never leave their country of birth and far more leave temporarily for work than to emigrate and settle abroad. Matching workers from one country with jobs in another often involves intermediaries such as for-profit recruiters as well as social networks, as when migrants abroad help friends and relatives to join them. The socioeconomic costs of international labor migration are falling, explaining why internal and international labor flows may rise even as the fundamental demographic and economic differences that motivate movement for higher wages shrink. Many of the world’s guest workers are from middle- rather than low-income developing countries, for example, from Mexico rather than poorer Nicaragua in the United States.

Most international migrants are young and of working age. The International Labor Organization (ILO, 2015) estimated that 150 million or 65% of all international migrants in 2013 were in the labor forces of the countries to which they moved, so that 73% of international migrants 15 years and above were employed or seeking jobs, compared to 64% of non-migrants 15 years and above. ¹ Both male and female migrants have higher labor force participation rates than non-migrants; 78% for migrant men compared to 77% for men born in the country and 67% for migrant women compared to 51% for women born in the country.

Most of the world’s 150 million migrant workers are not guest workers. Instead, most are immigrants, including naturalized citizens, who have moved from one country to another and settled. Some are unauthorized, but a significant fraction, perhaps 10–20 million, are guest workers expected to return to their home state rather than settle. The share of guest workers among migrant workers is highest in Gulf oil-exporting countries and city states such as Singapore.

ILO conventions and national laws call for migrant workers to be treated equally in the workplace, which means that they should receive the same wages and benefits as local workers (Martin et al., 2006). Equal treatment is the ‘right thing to do’ as well as the best way to protect local workers from ‘unfair’ competition from migrants, who may be willing to work for lower wages than local workers. Truly equal treatment is hard to achieve, in part because migrant workers are normally tied by contracts to one employer, while local workers can change employers. Migrants who lose their jobs may be required to leave the country.

There are two other reasons why equal treatment is difficult to achieve. First, only half of the world’s jobs are wage-paying jobs, and only a quarter of all jobs offer work-related benefits (ILO, 2015). In many countries, employers of migrant workers are exempt from contributing to some benefit programs such as social security, which reduces the cost of migrants relative to local workers. ² Second, only half of the world’s countries have national minimum wages. In countries with minimum wage laws, some sectors that employ migrants, including agriculture and domestic work, may be exempt from requirements to pay minimum wages. ³

GCM labor recommendations

The countries coordinating the GCM, Mexico, and Switzerland released a ‘zero draft’ in February 2018 with 22 actionable commitments, from obtaining better migration data to enhancing the portability of social security benefits; a revised draft released in March 2018 includes the same 22 items. These drafts call on the United Nations to review each country’s progress toward achieving the GCM’s migration goals during an International Migration Review Forum every 4 years beginning in 2022.

GCM recommendation 5 calls on governments to ‘enhance availability and flexibility of pathways for regular migration’ by expanding regular migration to reflect ‘demographic and global labor market realities’, developing model labor mobility agreements by sector, and admitting migrant workers at all skill levels. Migrant pathways into countries should reflect labor demand and supply conditions in local labor markets, and the mechanisms used to determine how many migrants to admit should involve input from local stakeholders, including employers and unions.

Governments are asked to develop labor mobility schemes for ‘temporary, seasonal, circular, and fast-track migrants in areas of labor shortages’. All migrant workers should be able to bring or unify their families abroad, that is, the GCM calls for the abolishment of income and language, type of visa, length of stay, and other tests now used to determine whether family members may accompany a migrant worker. The GCM also calls on governments to provide ‘work authorization and access to social security and services’ for the members of migrant worker families.

GCM recommendation 6 calls for fair and ethical recruitment, including prohibiting recruiters from charging any fees to migrant workers and to make all of the beneficiaries of the work performed by migrants jointly accountable for any labor law violations in the supply chain. Governments are asked to ratify ILO and other conventions on recruitment and to learn from best practices ‘to promote the full respect for the human and labor rights of migrants’ and to monitor recruiters effectively to ensure they do not charge fees to migrant workers.

Governments hosting migrants should add labor inspectors to ensure compliance with labor laws, guarantee that migrant workers retain their identity documents, and permit migrants to form and join unions while creating firewalls between government agencies that enforce labor laws and agencies that enforce immigration laws. Recommendation 6(h) calls on governments to issue portable visas that allow migrants to change employers and to change the duration of their stay abroad ‘with minimal administrative processes’.

Implications of the GCM recommendations

GCM recommendations 5 and 6 would turn TFWPs from guest worker to immigration programs. Migrant workers could arrive with their families, family members could get work authorization and services such as education and health care for children, and migrants could decide to change employers and extend their stays.

GCM recommendations 5 and 6 substitute migrant rights principles for labor market realities, making them unlikely to be adopted widely. They include three major contradictions. First, most governments have local-workers-first policies, which means that employers must try and fail to find local workers before being certified to recruit foreign workers. If migrant workers can change employers, how will guest worker programs fill the specific vacant jobs for which local workers are not available? Will ever-more migrants be admitted until all vacant jobs are filled or will governments limit migrant admissions and expect employers unable to attract migrants to make other adjustments?

Second, the GCM does not deal with how governments will determine whether migrant workers are needed. Instead of discussing how to establish minimum and prevailing wages and efforts to recruit local workers, the GCM talks of ‘demographic realities’ and labor imbalances. Such generalities do not answer fundamental questions such as whether to approve a farmer’s request for 1000 migrant workers to harvest fruit. Governments now look at whether the farmer tried to recruit local workers at prevailing wages and whether it makes sense to admit migrants rather than encourage other responses from labor-saving mechanization to imports.

Third, the GCM’s call for no worker-paid recruitment fees ignores the reality that matching workers with jobs over borders has costs (Martin, 2017). If employers pay all costs for the migrants they recruit, but migrants are free to change employers, do employers lose their investment in particular migrants when they change jobs? Will governments require the migrant’s new employer to reimburse the first employer for recruitment costs? Will migrants have to stay with the employer who paid their recruitment costs for a period of time before being eligible to change employers?

The GCM effectively converts guest worker programs into immigration programs, as migrants arrive with families who can receive work permits and public services. Will there be any labor market restrictions on relatives of migrants? Will employers who recruited particular migrants be responsible for the costs of any public services consumed by migrant families? Until such questions are answered, the GCM’s labor recommendations are likely to add to the widening gap between ideals and realities in labor migration.