The Global Talent Race
Since the end of World War II, trade and capital flows have been liberalized more than at any other point in history, whereas the mobility of labor remains heavily restricted. But in a global knowledge economy, countries that do not join the competition for high-skilled workers will fall behind.
WASHINGTON, DC – More than 3% of all people live outside the country of their birth. But while the share of migrants in the world’s population has remained mostly stable for six decades, its composition has changed. The share of high-skilled migrants relative to low-skilled migrants has grown dramatically, owing to the globalization of demand for talent. And this development has a clear geographic dimension. Nearly 75% of all high-skilled migrants reside in the United States, the United Kingdom, Canada, and Australia; over 70% of software engineers in Silicon Valley are foreign-born. But today’s leaders could well be tomorrow’s laggards.
Many factors are driving the shift in the composition of migration flows, including the Fourth Industrial Revolution, declining transportation and communication costs (high-skilled migrants tend to travel farther to their destination countries than do less-skilled migrants), and limited educational opportunities in source countries. The main cause, however, is the growing recognition that human capital plays a key role in today’s knowledge economy.
A worldwide “war for talent” is being waged, and enterprises that manage their global talent pool well are marching ahead. Most multinational corporations now insist that high-potential executives gain global experience by working in other countries, and they have made international mobility a prerequisite for senior leadership positions. Some of the global economy’s most familiar players – including Google, Microsoft, Alcoa, Clorox, Coca-Cola, McDonald’s, Pepsi, and Pfizer – have immigrant CEOs.