Global Talent Update – May 2024

EUROPE

Germany’s new coalition government wants to attract 400,000 qualified workers from abroad each year to tackle both a demographic imbalance and labour shortages in key sectors that risk undermining the recovery from the coronavirus pandemic. “The shortage of skilled workers has become so serious by now that it is dramatically slowing down our economy,” said Christian Duerr, parliamentary leader of the co-governing Free Democrats (FDP).

The employer-friendly German Economic Institute estimates that the labour force will shrink by more than 300,000 people this year as there are more older workers retiring than younger ones entering the labour market. This gap is expected to widen to more than 650,000 in 2029, leaving an accumulated shortage of people of working age in 2030 of roughly 5 million.

After decades of low birth rates and uneven migration, a shrinking labour force also poses a demographic time bomb for Germany’s public pension system, in which fewer employees are burdened with the task of financing the pensions of a growing mass of retirees who are enjoying longer life expectancy.

Read more at Germany wants to attract 400,000 skilled workers from abroad each year | Reuters.

ASIA PACIFIC

The Thai Chamber of Commerce (TCC) is opposing the government’s plan to increase the minimum daily wage to 400 baht for workers nationwide. Poj Aramwattananont, vice-president of the TCC and the Board of Trade of Thailand, described the proposed hike as a double-edged sword, with both negative and positive effects.

“Some businesses can afford to increase wages, but some may face adverse impacts. The proposed hike will cause problems in several provinces that are not ready such as Phrae and Nan where there are very few industrial plants and hotels [to accommodate tourists],” he said.

Mr. Poj said that wage hikes should be applied to industries with more Thai workers than immigrant workers. Otherwise, money will flow out of the country.

Sangchai Theerakulvanich, president of the Federation of Thai SMEs, also said he disagreed with the proposed hike. He said small and medium-sized enterprises (SMEs) are struggling to recover after reeling from the effects of geopolitical tensions on the global economy. “SME operators have to control costs. Wage hikes will also hurt about 2.7 million micro-enterprises, which employ about 5.5 million workers.”

Read more at Thai Chamber of Commerce blasts govt wage hike plan | Bangkok Post.

AFRICA

Nigeria has paused a controversial annual levy that would require businesses employing expatriates to pay $15,000 (£12,000) for a director and $10,000 (£8,000) for other workers. President Bola Tinubu imposed the tax, but it was met with widespread condemnation.

The Ministry of Interior said the levy would be paused for “dialogue among stakeholders.” He said the tax was intended to “discourage abuse” of the expatriate quota and create “employment opportunities for Nigerians while closing wage gaps between expatriates and local workers.”

Dele Kelvin Oye, national president of the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), welcomed the pause. He praised the government for considering the implications the levy could bring on Nigeria’s business community.

Read more at Nigeria pauses controversial expatriate employment levy | BBC.

SOUTH AMERICA

The United Arab Emirates, Azerbaijan and Brazil, former and future hosts of UN climate summits, are joining forces to push for an international agreement to limit global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit).

The UAE’s Conference of the Parties (COP28) presidency said that it would form a “troika” to focus on ensuring that more ambitious CO2-cutting pledges are made ahead of a deadline at the COP30 summit to be held in 2025 in Belem, Brazil. Azerbaijan will host this year’s United Nations climate event in November.

In 2015, almost 200 governments signed the unprecedented Paris Climate Agreement to phase out fossil fuels in favour of renewable energy in the second half of the century by capping global warming at 1.5C.

That target is fast slipping out of reach, as global greenhouse gas emissions continue to soar. The next round of countries’ climate targets is seen as a crucial last chance to prevent global warming exceeding the 1.5C limit. The Troika partnership should “significantly enhance international cooperation and the international enabling environment to stimulate ambition in the next round of nationally determined contributions”, read the final agreement reached at COP28.

Read more at UAE, Azerbaijan, Brazil join forces to limit global warming to 1.5C | Al Jazeera.