In today’s age of coupling between economies, cross-border business and multiculturalist societies, the topics of employment opportunities and mobility are greatly discussed. This personal experiment of mine seeks to identify countries which are most relevant to work in, in terms of opportunities for both local and foreign workers.
The objective is not to identify the “Best” countries to work in, rather it is to identify the “Relevant” countries to work in. There are umpteen lists of “Best Countries to Work In”, mostly dominated by OECD nations. In reality, economic (and so, employment) opportunities in most OECD countries will remain dry due to their economic downturn, high rates of unemployment, growing prominence of “right-wing” parties who do not really favor foreign workers, and paucity in the learning experience for workers since most functions are outsourced to developing countries.
On the contrary, one might identify relevant countries in terms of their economic opportunities, since the ensuing opportunities for workforce is a derivative of that. They may not be the “Best” countries to work in due to inadequate infrastructure, health and safety issues. However, they would be “Relevant” in terms of opportunities and so, demand.
Methodology: This experiment is made by using IMF’s projected statistics of 190 nations. Seven parameters are used for screening and equal-weight scores assigned for each parameter (except for deviations in two cases). These parameters are restricted to quantitative data, with only one qualitative parameter. (1) Growth and size of the economy – CAGR of projected GDP in US$ terms from 2015 to 2019 to be above a threshold of 2%, with the actual GDP to reach a minimum US$50 million by 2019. The rationale is that growing economies will create demand for workforce, plus the absolute size of the GDP signifies a larger critical mass in terms of the employment opportunities. Hence, countries with their 2019 GDP over US$1 billion get an extra score (one of the two deviations from the equal-weight scoring). US$ terms make it comparable for foreigners; (2) Growth in Per- Capita basis – This is to negate the impact of population growth on the countries’ economic story. Per-capita income is a better indicator of what the person’s wallet actually earns, though it is still susceptible to skewness in income distribution; (3) Growth of the economy’s actual output – Since IMF’s GDP data in US$ terms (used in #1) is in current prices, the CAGR of GDP in constant prices is taken to test the country’s ‘actual’ economic output. This is set to above a threshold of 2.5% for screening only; (4) Investments as a % of GDP – This indicates the creation of actual productive assets in the country to support its growth. Countries with an average Investment to GDP of over 15% from 2015-2019 are taken. Plus, countries with a ratio of over 25% receive an extra score (this is an important parameter in this experiment and hence, the second of the two deviations from the equal-weight scoring). Another score is given if the ratio in 2019 is higher than that in 2015, as that augurs well for its future; (5) Average inflation and its growth – This signifies the “real-income” for workers. It is pointless to have high per-capita growth with high inflation since then the real income is actually depressed. Countries with an average inflation of less than 8% from 2015-2019 are taken. Another score is given if this is lower in 2019 than in 2015; (6) Average unemployment and its growth – Countries with high unemployment rates do not bode well from net employment perspective, irrespective of their economic growth. Countries with average unemployment rate of less than 7% from 2015-2019 are taken. Another score is given if this is lower in 2019 than in 2015; (7) Safety factor – This is really to weed out countries with internal civil wars/strife which makes normal living impossible. Most developed countries receive a score of 2 while developing countries who are not in the cusp of an all-out internal civil strife receive 1.
Results: Ranking for the Top-30 countries is based on the final scores across the seven parameters. If 2 or more countries have the same score, their ranking is based on their GDP CAGR from 2015-2019. This experiment throws interesting findings, though it is subject to the assumptions made in the methodology.
Of the Top-30 shortlisted countries, seventeen are from Asia itself – of which seven are from ASEAN, four each are from the Far-East Asia and SAARC, and one each from GCC and Central Asia. This indicates that the Asian region is set to emerge as a real reckoner for future employment opportunities. GCC’s entry is Qatar. Saudi Arabia did not make it as its projected Per Capita GDP in coming years is lower than the threshold, which does not bode well for foreign workers. Cambodia, another frontier economy, did not make it as the size of its economy in 2019 at US$26 million would still be much small to create a critical mass of employment opportunities. China seems all set to recover despite its current ‘economic plateau’ concerns, given the high score it notched. Hong Kong and Singapore made it. This means trading economies will have opportunities, not just manufacturing ones. Amongst the BRICS, only China, Brazil and India made it while Russia and South Africa did not. High unemployment was the bane for South Africa, while growth in actual economic output in Russia was below the threshold. No European nation made the cut, except for Romania. Most Western European nations lost out on economic growth and unemployment parameters. Emerging European ones like Poland, Lithuania, Serbia etc lost due to high unemployment. Canada and Japan did not make the shortlist since their actual economic output is set to grow below the threshold. Latin America is another sweet-spot with as many as five entries. Mexico is expected to gain with US’ recovery, while other medium-sized countries like Chile, Peru and Ecuador are also expected to pick up. East Africa is another emerging region, with as many as three entries (Ethiopia is assumed as East African for simplicity). Australia narrowly made the shortlist despite its current economic concerns, New Zealand may remain a bastion for UK migrant workers given recent initiatives of Christchurch’s Canterbury Board etc in the UK to pitch for skills.
Overall, the Top-30 shortlisted countries are a fair mix of English and Non-English speaking nations; Developed and Developing nations; Large and Small-Population nations; and Safe and Unsafe nations. Top-30 Final Shortlisted Final Score Final Rank
Limitations: It is largely based on quantitative data and does not concentrate much on qualitative parameters. However, qualitative parameters are often subject to personal judgment which can vary, and the experiment wanted to cut out impact of personal judgment. The shortlisted ones are skewed towards emerging/frontier economies.
However, that is where the economic opportunities will occur in upcoming years, and hence the demand for incremental employment. The parameter of safety remains debatable from the future’s perspective. Boko Haram and Ebola might impact Nigeria adversely in future even though it is now a hot-spot as Africa’s largest economy. While insurgency incidents in Pakistan were mostly in outlying areas, they have struck its major cities as well putting normal civilian life at risk. Kenya’s fight against Somali insurgents, Bangladesh’s internal politics between its two parties, India’s economic headwinds, and Thailand’s political vacuum could also pose risks. However, limitations of future uncertainty can impact any experiment.
Image Courtesy: Capital Business Middle East
Originally published here – http://www.capitalbusiness.me – (vol 9 – issue 7 – 2014) | 33 |