How can Northeast Asia compete for global talent?

Authors: Gi-Wook Shin, Stanford University and Rennie J. Moon, Yonsei University

Competition for global talent is growing, especially among advanced countries. With the rise of the knowledge economy, countries and companies are actively seeking to attract talent from around the world. In leading companies such as Google and Apple, one can easily find engineers from countries such as China and India. Top talent has become increasingly mobile.

In 1975 less than 1 million students worldwide studied abroad but by 2010 the number had increased to more than 4 million. By 2025, the number is expected to reach as much as 7–8 million.

Competition for global talent has further intensified because of demographic changes. Many developed countries are facing serious demographic crises due to low birth rates and ageing populations. Countries like Germany, Italy, Japan and even China are expected to see shrinking populations in the coming decades. As a way of dealing with such demographic challenges, these countries all seek to attract foreign talent.

But attracting foreign talent can be particularly challenging in Northeast Asian countries. According to the Global Talent Competitiveness Index 2014 published by the French business school INSEAD, Japan, South Korea and China have all done very poorly in terms of brain gain and suffer acutely instead from brain drain. They have relatively low global talent competitiveness rankings of 20th, 29th and 41st respectively. On the other hand, Western states such as the United States, Canada and Australia come near the top of the list at 4th, 5th and 9th respectively.

One factor that may explain the global talent competitiveness of the United States, Canada and Australia is their general tolerance of immigration. If this theory is true, Northeast Asian countries face greater challenges in attracting foreign talent.

So how can Northeast Asia compete for global talent?

Some experts argue that Northeast Asian nations need to open their doors to migration. But most people in Northeast Asia are not ready to embrace mass migration yet. Historically, governments in Japan and South Korea have promoted ethnic unity and this exclusive attitude remains very strong among the public even today. Similarly, China primarily targets its own diaspora rather than trying to attract foreign talent. Many foreigners come to Northeast Asia to study or work but with little intention to stay permanently.

Until these countries are ready for migration, which will likely take at least another 10 years, they need different approaches to attracting global talent. Strategies should carefully consider the social and cultural environment in these countries, as well as accommodating the interests of foreign talent. One potentially successful strategy may be for Northeast Asian countries to target the social capital that foreign talent bring.

When countries consider global talent, they tend to focus on their knowledge and skills, or human capital. These criteria are certainly important. But in today’s knowledge economy, governments and businesses need to better appreciate the value of migrant and expatriate social capital. When individuals move from one place to another, they bring not only knowledge and skills but also social networks. Global talent offer both human and social capital.

When people build social networks in more than one place, they can act as bridges between those different places. Such bridging can be local, national or transnational. Transnational bridging is increasingly important in the age of globalisation. A good example is Indian engineers working in Silicon Valley who also work closely with fellow nationals back in India. By bridging geographically distant networks, they build trust, connect disparate cultures and facilitate cross-national cooperation. These are all factors that are essential to successfully managing international business transactions.

Transnational bridging can form the basis of strategies in Northeast Asia to both attract global talent and justify the presence of foreign workers to domestic publics. Japan, South Korea and China can all offer foreign talent valuable experiences and networks, if not permanent places to live. Governments and businesses can help foreign talent build social ties while working in their host societies, and encourage them to bridge between their home or other places of residence and Northeast Asia after leaving.

Policies emphasising global talent as transnational bridges, rather than permanent migrants, may also appeal more readily to publics in Northeast Asia accustomed to discourses of ethnic unity. Even if foreign talent decide to leave after some years of study or work, they are not necessarily a lost investment since they may continue to facilitate networks between their home and Northeast Asia. The same can be said for nationals who leave for foreign countries to study or work but who never return home.

Rather than pushing prematurely for more open migration policies, Northeast Asian societies should focus on capitalising on the social capital of global talent, and convert brain drain into positive brain linkages between Northeast Asia and the world.

Gi-Wook Shin is director of the Shorenstein Asia-Pacific Research Center at Stanford University.

Rennie J. Moon is an Assistant Professor at Yonsei’s Underwood International College with expertise in comparative education

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Lintong Feng
2 April 2016 1:27 am

While the main argument may or may not be true (although I think it has some truth to it), the use of only USA, Canada and Australia among the many developed countries is a bit unfortunate and biased in the sense they represent countries which have traditionally developed through immigration including early colonisation. Why not include some of the developed European countries?

Nancy Snow
4 April 2016 3:29 pm

This is just a syntax point. “In 1975, fewer than 1 million students worldwide….” Fewer is for things that you can count, like students, while less is for things you cannot. Fewer is also used for plural nouns. [In 1975 less than 1 million students worldwide studied abroad but by 2010 the number had increased to more than 4 million. By 2025, the number is expected to reach as much as 7–8 million.] Thanks for the article.