The next billion workers: how can countries attract the global workforce of the future?

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Johann Harnoss, Partner and Associate Director, BCG Henderson Institute Fellow, BCG, Janina Kugel, Former CHRO of Siemens; Non-Executive Board Member; BCG Senior Advisor, BCG, Marley Finley, BCG Consultant; BCG Henderson Institute Ambassador, BCG

• The geography of global talent pools is shifting – the global population is growing and becoming more educated.
• Many countries that rely on migrant talent today lack crucial connections to those countries that will become future talent hubs.
• The Openness Index reveals how open different origins are to destinations with weaker cultural, geographical or diasporic ties.
• Government leaders must go beyond improving their overall attractiveness and deploy targeted strategies to develop mutually beneficial connections.

By 2040, the supply of international talent will reach an all-time high, but it will be found in new places. Government leaders must prepare now to attract the workforce of the future.

Immigration is fundamental to the success of many of the world’s largest economies. But for a significant number of them, a critical evolution is underway. The talent pools that they have consistently drawn from will start to shift, as several global trends coalesce (see Exhibit 1).

The first trend reflects sheer numbers. While many high- and middle-income countries face population declines – with the number of working-age people (ages 20-64) projected to shrink by 200 million by 2040 – globally the working-age population is set to increase by 700 million. Much of this growth will be in Africa, South America, and Asia.

The second trend results from new education opportunities. By 2040, 60% of working-age adults will hold a high school degree (up 13 percentage points from 2020), and 80% will live in Africa, Asia, or South and Central America. Europe and North America will collectively be home to only 19% of this group in 2040, down eight percentage points since 2020 (see Exhibit 2).

In other words: the supply of internationally mobile talent will be greater than ever, but it will be found in new places. Government leaders need to start planning now by determining not only where the new talent pools will be, but also which pools they can best attract – and start building bridges.

The Openness Index

Countries can take broad steps to appeal to prospective immigrants, for example, streamlining visa processes, raising living standards, and improving integration resources. However, three significant factors persistently influence migration pathways, and are more challenging for leaders to address: cultural commonality, geographic proximity, and migrant network size. (Cultural commonality can be represented in different ways; we look at the impact of historical colonial ties and shared languages as proxy indicators of cultural similarity.)

Our research shows, however, that these factors matter more for emigrants from some origins than for others. We studied how each country’s emigration pathways correlate with cultural, geographic, and diasporic proximity to develop an Openness Index that captures these differences (see Exhibit 3). Public leaders looking to build connections with future talent hubs can consider openness alongside talent pool growth and size to prioritize origins for migration investment.

Applying the Openness Index

Many residents from countries to the right of the 2x growth line, found overwhelmingly in Africa and the Middle East, will likely search for employment opportunities abroad. Nigeria and Ethiopia are among the largest talent pools in this group. But the Openness Index shows that their emigrants have been drawn primarily to destinations with which they already share ties. However, in Kenya, Tanzania, Afghanistan, and Iraq, each with talent pools larger than 7 million, emigrants have shown more willingness to move to places with fewer connections.

Countries with more modest growth might have lower emigration rates but will likely remain major sources of global talent: India and China will be the largest hubs of adults with at least a high school education in 2040 (~320 million and ~250 million, respectively). But the index shows a preference among their emigrants for countries with close ties. Countries such as Mexico, Argentina, Vietnam, and Bangladesh will also have sizeable, growing populations of high school graduates – but have demonstrated greater openness when it comes to migration destinations.

Getting started on strategies for the workforce of the future

Given the talent evolution, government leaders must go beyond improving their overall attractiveness and deploy targeted strategies. Some have already started to address this need in notable ways:

• Collaborate bilaterally: Portugal and India’s bilateral labour mobility agreement, signed in 2021, established a standardized process for Portuguese employers to hire Indian workers. The former share job openings with a centralized government agency in India, which then selects qualified candidates and facilitates the visa process. India is now tied with Brazil as Portugal’s fastest growing source of immigrants, having increased by 13% from 2021 to 2023.

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• Customize recruiting: To fill critical job vacancies, Canada’s New Brunswick province has hosted virtual international recruitment sessions for residents of specific countries, such as Nigeria, the United Arab Emirates, and Argentina. The sessions serve double duty, addressing near-term labour shortages while also building targeted connections with growing talent pools.
• Offer refuge: Afghanistan, one of the highest growing and relatively open sources of people with a high-school education, was also the largest source of asylum seekers in 2021. Future immigration-dependent countries that took in displaced Afghanis both extended a humanitarian hand and strengthened their connection to this significant future talent hub. Germany, for example, became host to more than 200,000 Afghan refugees and asylum seekers, the third-largest destination after Afghani neighbors Pakistan and Iran. (It should be noted that crises that lead to spikes in emigration rates do not necessarily lead to more openness. Cultural, geographic, and diasporic ties can be particularly influential in determining refugee settlement, or displaced migrants may move to distant, less familiar destinations that offer asylum. By offering asylum, destinations provide a refuge to people with immediate need and can also strengthen diasporic connections to growing talent hubs.)

Other strategies to consider include running targeted advertising campaigns and increasing visa quotas for countries with future talent hubs. Institutional partnerships between schools, research organizations, and companies can also inspire and facilitate migration.

Our research has shown that diaspora networks increasingly influence migrant pathways over time. That means that links formed today, whether the result of proactive relocation or tragic displacement, will likely shape future pathways. With the right strategy and sufficient investment in the near term, countries can secure their futures as popular destinations for global talent and, in so doing, prime their economy for long-term resilience and growth.

Further reading: Attracting a diverse set of immigrants is just one of six components of an economically fruitful migration strategy. To learn about the other five, read the new BCG Henderson Institute report, “A New Migration Strategy for Growth and Innovation.”