About 55,000 migrants are believed to be smuggled from across Africa into Europe annually. While Europe benefits, human capital flight of both unskilled and highly skilled workers accounts for substantial losses for source countries in Africa.
Africa is rich both in human and natural resources capable of driving rapid economic growth. Over the last decade, the continent has made praiseworthy economic growth driven by enhanced economic governance and foreign investments.
Unfortunately, growth continues to leave the continent’s poorest nations behind.
Countries such as Eritrea, Malawi, Zimbabwe, Sudan, Ethiopia, Benin, Togo, Guinean and Congo Republic are some of the African states which continue to face tremendous economic challenges with large unskilled-labour populations seeking employment.
In addition, issues of well being, security, human rights, and human security remain major challenges for Africa.
Joining refugees fleeing the crises in Syria and parts of Middle East, thousands of highly skilled and unskilled migrants from Africa have left for Europe in 2015.
Europe reaps most of the rewards from migration
African migrant workers have become a major part of a global movement of ‘educated poor,’ attempting to improve their lives. In search of safety and better livelihoods, both desperate and voluntary migrants — including a significant educated and skilled population — have joined the massive tides of humanity stemming from conflict zones in the MENA region.
Migration can be economically beneficial for both labour-exporting and labour-receiving regions in different ways. However, Europe’s shirking labour force and economic structures make it more beneficial for Europe, as migrant workers fill unmet labour demands in both high and low skilled roles under guest worker programs, thus alleviating skills shortages.
The economic decline of African nations is dramatically reflected in the increased number of economically displaced people and labour migrants stemming from Africa.
This one-sided human capital flow has the potential to keep African economies underdeveloped and dependent on Western largesse. Sadly, mass migration will continue to account for the low productivity levels in rural areas until Africa states begin to institute greater economic diversification, including growth in agriculture and manufacturing, as well as the development of a skilled workforces.
Impact of Human Capital Flight on Critical Sectors of Struggling Economies
Human capital flight constitutes a massive economic loss for Africa. For instance, Ethiopia lost 75% of its skilled workforce between 1980 and 1991.
Africa’s loss of skilled and educated workers to Europe continues to hamper the continent’s ability to decrease poverty. Human capital flight, especially for the poorest countries, imparts severe costs, mainly in critical sectors such as health and education.
Despite economic challenges, a good number of African countries invest substantial revenues in education. For instance, a comparison of World Bank data on total percentage of government expenditure on education in 2010 indicates that labour-exporting countries spend a substantially larger percentage on education than labour-importing countries.
The UK (13%), France (10.1%), Norway (15.3%) Finland (12%), Sweden (13.2%), and Germany (10.6%) all spend far less on education as a percentage of total expenditure than poorer African countries. In comparison, states like Togo, Ethiopia, Benin, Congo Republic, Tunisia, and Gambia spend 19.6%, 22%, 26.1%, 29%, 25.6% and 17.3% respectively on education.
Human capital flight: An impact study on the medical sector
Unfortunately, these substantial investments by labour-exporting countries are in turn lost to human capital flight as highly educated professionals migrate in search of better opportunities, better wages and better working environments.
Tables 1-5 below give an illustration of the loss on investment in medical education in nine sub-Saharan African countries.
Table 1| Statistics on population health and medical resources in nine sub-Saharan countries
Table 2| Expenditure on primary & secondary schools in nine sub-Saharan countries, based on most recent data per nation
Table 3| Expenditure on medical schools in nine sub-Saharan countries
Table 4| Estimated lost investment on source country doctors working overseas
Table 5| Estimated lost investment based on time working overseas, interest rates, and cost of education
Two Sides of a Coin for Foreign Investors
The relationship between migration and foreign direct investment remains largely unexplored.
The presence of migrants has the potential to stimulate foreign investment by promoting information flows across international borders. Ethnic networks in the diaspora could serve as channels of information for prospective businesses, such as business environment and ethics, consumer preferences, market structure, and investment opportunities abroad.
However, research indicates that “the relationship between foreign investment and migration is stronger in the case of migrants with tertiary education.’’
While migration might be a plus for prospective investors, it becomes necessary for investors and businesses already operating in labour-exporting economies to raise wage offers as a means of attracting migrating skilled labour to fill the resultant vacancies, especially in economies where local content is a requirement for investment.
Africa’s loss, Europe’s gain
With about 200 million 15-24 year olds, Africa has the youngest population in the world. The United Nations estimates that by 2050, Africa will be home to more than 20% of the world’s population (and thrice that of Europe), with at least 800 million between the ages of 25 and 59 years.
This population explosion offers great prospects for Africa’s future economic transformation, given that one out of every four workers in the world will be an African by 2050.
2050 will also see 34% of Europe’s population be 60 years old or older. This unfolding global demographic change present challenges and opportunities for both Africa and Europe alike.
Africa must harness its demographic dividends, or risk losing its active workforce to Europe as it fill its skills gaps and sustains its own economic growth.
