Expat flow to Gulf unlikely to grow in next 2 years

Migrants flow to Gulf countries is unlikely to grow over the next two years but ongoing projects will help maintain employment for the existing expatriates in the region.

Although a recovery in oil prices and a fiscal stimulus implemented by GCC governments are likely to help maintain employment levels for existing migrants, new migration flows are unlikely to grow over the next two years. Therefore, remittances from the GCC countries may remain stable, but they are unlikely to grow rapidly for a year or two, according to the latest World Bank report.

The report also projected that substantial financial resources and long-term infrastructure development plans of the Gulf countries imply that they will continue to demand migrant workers in the longer-term.

It said deceleration in construction activities in the Gulf countries may affect migrant-sending countries in East Asia and South Asia.

The report said that risk to the Mena outlook is that weak job markets and persistently high rates of unemployment in the destination countries may lead to further tightening of immigration controls, especially for low-skilled migrants. Even with projections of economic recovery in the advanced economies, unemployment rates are projected to remain high during 2010 and 2011, with a “jobless” global recovery.

The labour market in the United States, the largest migrant-destination country, is expected to remain weak in the medium term, and unemployment rates are expected to remain high.

The applications from high-skilled foreign workers for temporary worker visas has fallen in the United States, with the number of days to fill the quota rising from two days for the 2008 fiscal year to 264 days for applications for the 2010 fiscal year. If employment recovers only with a substantial lag to the recovery in economic output, then it is likely to have an impact on the employment levels and incomes of migrants—and, in turn, on their ability to send remittances.

Gulf countries are also offering unpaid leave to migrant workers to encourage them to return home until the economy recovers, but there appear to be few takers, World Bank said.

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