Global financial crisis and return of South Asian Gulf migrants: patterns and determinants of their integration to local labour markets

Studies record that a large number of South Asian migrant workers in the Middle–East had to return to their home countries owing to the global financial crisis and loss of jobs. However, their distress of loss of job in the gulf is compounded by the fact that in their own home countries the rehabilitation and reintegration of these workers is tedious and often the returnees are thrust with forced choices. This paper, based on a primary survey conducted in five south Asian countries, namely; Nepal, Sri Lanka, Bangladesh, Pakistan and India, concludes that on return, the employment status of REMs were in general worse off than in their host country with high share of casualisation, self employment and unemployment in the crisis year and a decline in their average monthly earnings. The analysis suggests that those who found employment on return was in fact driven by economic compulsions to reduce their job search period and cost.Global Financial Crisis; Return Migrants; South Asia; Employment; Wages

Long term implications of low fertility in Kerala

In recent years, Kerala has made remarkable progress in its demographic transition. The State has achieved below replacement level of fertility two decades ahead of the all-India target year of 2011 and India is likely to achieve the replacement level only by 2021. The TFR declined from a high level of 5.6 in 1951-61 to about 1.7 in 1993, a level which is very much below the replacement level of 2.05. The State's IMR has touched a low level of 13 in 1993, a level comparable to that of some of the developed countries of the world. The population growth rate has declined to about 1 per cent per annum in 1995 from a high level of 2.3 per cent per year during 1961-71. Thus Kerala's demographic trends in the first half of the 21st century will be dramatically different from that of the second half of the 20th century. Total population of the State is expected to increase by 170 percent in the second half of the present century (from 11,723,000 in 1951 to 31,553,000 in 2001), the growth (if any) in the next half a century will be very negligible. The crude death rate declined from about 20 to about 6 in the last half a century, but it is likely to increase from 6 to 13 in the next century. The crude birth rate decreased from 40 to about 16 in the last half a century, but it is likely to remain more or less stable in the next half a century. While Kerala experienced varying degrees of net out-migration and net emigration in the last half a century, migration trend in the next half a century is somewhat uncertain. It will depend more on socio-economic developments than on demographic trends. The socioeconomic implications of the reversal of the demographic trends will be far reaching: (a) To begin with, the pressure on schools and colleges will be a thing of the past, giving ample opportunities for the educational system to concentrate on the quality of education rather than on quantity. (b) This is also true of hospitals and health personnel catering to the health needs of the children. It will be easier to bring about the needed improvement in the quality of their services. (c) In the transitional period, parity between the number of girls and boys in their respective marriage ages will be maintained. But this is a temporary respite. (d) Other things being equal on the economic front, unemployment among the young working age population will be greatly reduced. The educated young workers might be able to pick and choose the job they want. But this is not the case with older workers. The number of older working population would almost double in a short period of 20 years between 2001 and 2021 (e) In the last half a century the major socioeconomic problems were related to the schooling, maintenance of health and nutrition and finding employment for the youngsters. In the next half a century, the major socio-economic problems would be finding gainful employment for the older working age population, maintenance of the health and nutrition of the elderly, and providing them with means of subsistence through social security and pension, etc.Kerala, fertility, mortality, migration, projections, aging, labour force, social security, pension, marriage

Intensifying masculinity of sex ratios in India : new evidence 1981-1991

We use data from the 1981 and 1991 censuses of India to examine (a) sex ratios among infants aged under 2, (b) child mortality (q5) by sex, and (c) estimated period sex ratios at birth (SRB) calculated by reverse survival methods, to see whether bias against female children persists during development and fertility decline, and whether techniques of prenatal sex determination and abortion of female foetuses are spreading in India as elsewhere in Asia. In 1981, rural and urban infancy sex ratios and estimated SRB for most states appear within the ‘normal’ range (104-106 males/100 females). However, urban Punjab, Haryana, Chandigarh and Jammu and Kashmir in the North / North-West zone appear masculine (108 or more). In 1991 however, these North / North-Western urban areas show starkly masculine SRB’s, as do the corresponding rural areas, Delhi, UP, and urban Gujarat, Bihar, Rajasthan, MP, Maharashtra, Assam and Arunachal Pradesh. Values reach as high as 118 for urban Punjab. The sex ratios of child mortality indicate that despite mortality declines, many regions that showed female disadvantage in 1981 continued to do so in 1991, and some areas worsened. Some Southern regions that showed ‘normal’ mortality sex ratios in 1981 now have ratios adverse to females in 1991. This increase in masculinity of period SRB’s indicates that the preference for male children in India is unchanged by fertility and mortality decline and socio-economic development. Since the increased masculinity is more in urban areas, which have higher literacy rates and better coverage of vital registration and health services, it suggests that the trend is due to the spread of prenatal sex determination and selective abortion of female foetuses rather than female under-registration or infanticide. The trend coexists with the excess female child mortality and female infanticide persisting in many parts of the country, for which we summarize evidence. In the aggregate, parents in India thus do not appear to be substituting prenatal for post-natal sex selection techniques

Induced abortion potential among Indian women

Information on abortion is limited and inaccurate especially in the developing world, which has led to several speculations on the prevalence of abortion in this region. A rise in prevalence of abortion is mostly accounted for in terms of increase in the prevalence of induced abortions, which reflects on the reproductive health of women. With the growing concern for reproductive health of women, the study of abortion phenomenon has drawn serious attention of researchers world wide. In such circumstances, this is an attempt to assess the induced abortion potential among Indian women by utilising information on proportion of unwanted and ill-timed pregnancies obtained through National Family Health Survey, India.

Economic and social dynamics of migration in Kerala, 1999-2004 : analysis of panel data

Panel studies based on the same set of sample households or individuals at two points of time 5 or 10 years apart are time consuming and are relatively rare in social science research. Such a method, however, was used in the South Asia Migration study (SMS) conducted by the Centre for Development Studies in 2004. About 125 of the 200 Panchayats surveyed in SMS were the same as those surveyed in Kerala Migration Study (KMS) in 1999. About 5 thousand of the 10 thousand households of SMS in 2004 were the same as those selected in KMS in 1999. About 14 thousand individuals in the 2004 sample households were the same as those enumerated in 1999. Thus, SMS provides comparable panel data for about 125 Panchayats, about 5 thousand households and about 14 thousand individuals at an interval of 5 years. Analysis of these panel data is the objective of this paper. The analysis of the panel data validated the trend in migration, remittances, employment and unemployment patterns, consumption habits, etc shown by the KMS and SMS (using the full set of 10,000 households). The trends shown by the full set of data were more or less the same as shown by the panel data using the same set of households. Thus, the panel analysis showed that sampling errors were within acceptable limits in both these studies. A special feature of the panel analysis was that it could provide quantitative measures of shifts in employment pattern of the labour force during 1999-2004. An equally important result of the panel analysis is the information it provided on process of employment of those unemployed in 1999 and the background information on the economic activity of the unemployed in 2004. Thus, the panel analysis provides valuable information on the transition of the unemployed before becoming unemployed and the transition after becoming unemployed. A one time survey cannot give such information. This is a unique feature of this panel study described in this Working Paper. Key Words: International Migration, Remittances, Unemployment, Replacement Migration, Kerala JEL Classification: J21, J2

The financial crisis in the Gulf and its impact on South Asian migrant workers

The financial crisis originated in the United States of America and impacted the Gulf Cooperation Council (GCC hereafter) countries after a time lag. The falling oil prices, contracting trade and declining private investment flows have adversely affected the GDP growth of the Gulf countries, which in turn affected the flow of migrant labour to and from them and remittances from them. In this context this study seeks to: Assess the impact of the recession on key industries in the GCC economies; Assess the repatriation of expatriate labourers; Assess the flow of emigrant labourers and fall in remittances; Assess the impact of loss of employment on the emigrant households’ in the country of origin; and Identify the measures undertaken by various stakeholders to mitigate the adverse effects. The study takes a two pronged approach to the subject. The impact of the global crisis on the GCC economies is first analyzed in terms of the sectors of the economy affected, the changes in GDP growth and employment of expatriate labourers. A Survey of migrants in the destination countries was carried out to assess the loss of employment and earnings and their coping strategies. It was followed by surveys of emigrants and return migrants in the countries of origin in South Asia. Study teams visited the six GCC countries and Malaysia to interview labourers as well as employers in various sectors. The global crisis has affected the GCC economies through falling oil prices, depressed property and equity prices, low investor confidence and reversal of capital flows. The GDP growth in GCC economies spawns large population growth, especially large influx of migrant labourers from South Asia. So a recession is expected to affect the flow of migrants and remittances. The rising oil prices since 2002 brought about large scale FDI flow into the GCC economies, rising investment rates and higher GDP growth rates by boosting the investment in telecom, banking, power and real estate. Private investment flow played an important role in the emergence of West Asia as the world’s largest market in project finance surpassing Western Europe and North America. The rapid growth of the GCC economies in the 2000s initiated increasing concentration of employment in manufacturing, construction and trade, and so attracted a large influx of expatriate unskilled and semi skilled labourers. One estimate put the composition of Indian expatriates in UAE as 50 per cent unskilled workers, 25 per cent semi-skilled and 25 per cent skilled professionals. The large influx of unskilled and semi-skilled workers led to higher rent inflation on top of unprecedented food inflation, attributed to global rise in food prices in the late 2000s. Over a quarter of the population in the GCC countries was spending above 20 per cent of their disposable income on food then. In response, the governments raised the wages of the public sector employees. This might have protected them, but vast segments of workers in manufacturing, construction and trade suffered real income losses. The precipitous fall of oil prices and the large losses suffered by the Sovereign Wealth Funds of the GCC countries had dried up the FDI inflow and credit flow into the Gulf; much worse, the banking sector also was facing a severe crisis with few international banks willing to lend to projects in GCC Countries. The world export demand was not expected to pick up immediately; and trade discriminatory measures were increasing as protectionism was spreading globally in the face of crisis. Added to the adverse economic environment were the not too transparent bank dealings in the Gulf, poor contract enforcement and discriminatory property ownership regimes. The silver lining was the quick rebound of oil prices - current prices surpassed the January 2008 levels- and the improvement in the ‘doing business environment’ in the Gulf countries. The construction boom in the GCC countries had come to a halt with 20 to 30 per cent cancellations, the bulk of which was in Dubai and trade volumes had declined. The phenomenal growth in employment of the past five or six years had come to a halt and about 40 per cent of the workers had been affected. Expatriate workers did not leave in large numbers, but salary cuts were widespread; stoppage of increments, benefits and perks was also reported. As regards the impact of the crisis on the South Asian migrant workers, the databases were poor and the numbers were hard to come by. The numbers mentioned by Indian ministers ranged between 50,000 and 500,000. An estimate of return migrants to Kerala arrived at by the Centre for Development Studies, based on a revisit of the emigrants and return emigrants of their 2008 Kerala Migration Survey, was around 61,000 for Kerala. Applying the methodology of the Kerala Resurvey to South Asia as a whole, the return emigrants from the Gulf were estimated to be 264,000. These estimates were far lower than the official predictions because migrants somehow struggled to stay back and earn to repay the debt incurred to pay for the cost of migration. Hence, the migrants’ loss of current employment did not lead to an immediate return as they would be hunting for various alternatives in which social support networks also played a part. Thus, the number of migrants returning would be lower than those losing jobs, the difference implying that they were in search of employment in the destination countries. The numbers of migrants from Kerala who lost jobs but continued to stay in Gulf were estimated to be 39,000 and those who returned at 61,000; and for South Asia, the corresponding numbers were 170,000 and 264,000 respectively. Despite the crisis and job loss, the demand for expatriate workers continued in the Gulf as was evident from the outflows of migrant workers from South Asia. Except for a 35 per cent fall in numbers from India, the flows in 2009 were comparable to those in 2008. But the direction of flow had changed; UAE was attracting less number of labourers whereas hardly any change was observed for Saudi Arabia. Migrant workers sent home remittances which boosted the economy. India being one of the world’s top remittance recipients at $52 billion (and China at$49 billion) in 2008, the policy makers were worried that remittance flows might decline due to the crisis. But estimates showed that remittances had, in fact, increased by 3 to 25 percent in 2009 in the South Asian countries. Micro level data on remittances from households with an emigrant currently in Gulf confirm the macro findings: about 94 percent of the households reported receiving regular remittances and about 30 percent receiving gifts during the crisis period. No change had been observed in the use of remittances by those households in 2008-09 compared to normal times. But the survey showed that 13 per cent of the emigrants reported loss of job. Nearly half of them had found another job, and a quarter were staying illegally in the Gulf. The work conditions had also changed due to the crisis: 25 per cent of the emigrants reported redundancies, 16 per cent reported postponement of contracts, 20 per cent reduction of wages, 17 per cent heavier workloads and 8 per cent were forced to take annual leave and proceed home. The survey among return emigrants in South Asia who had lost their jobs showed that 73 per cent of them remained unemployed one month after return; but their proportion had declined to 42 per cent at the time of survey. Among the employed, 37 per cent had managed to find regular employment, 40 per cent casual employment and 8 per cent, contract work. The unemployed return emigrants survived on past savings, borrowing, and support from family members. And a few had sold assets to meet expenses. The governments of the countries of origin and destination have taken a few steps to mitigate the hardships faced by the workers losing jobs. The Government of Nepal has announced a plan to meet the cost of migration of those who returned after losing jobs. The Government of Kerala state has announced a rehabilitation package for the Gulf returnees. Some GCC countries have relaxed slightly the visa conditions, allowing those who were thrown out of jobs to stay for longer periods in their country making it possible for them to search for alternative employment. The sponsorship condition has also been relaxed in some cases. Some of these reforms in the GCC countries might not be directly related to the crisis, because they were in the making for some time now in the face of severe criticisms of the work and life conditions of the expatriate workers in those countries even before the crisis struck them