Tackling the Challenge of Human Capital Flight for Better Future
he government is all set to sign a bilateral labor agreement with the British government to allow Nepali nurses to work in the United Kingdom. A meeting of the cabinet of ministers on June 5 decided to move ahead with the pact following a request from the UK’s Department of Health Services and National Health Service which is planning to hire 10,000 nurses from Nepal. The proposal from the UK is the first instance where Nepal has been approached by a foreign government for sourcing professionals/workers.
Similarly, Nepal and Japan in the first week of August agreed to amend the existing labor agreement which will open the door for more than 5,000 Nepalis who have already passed the language and skill test, to work in Japan. The bilateral labor agreement between Nepal and Japan signed three years ago allowed Nepali workers with specific skills to work for a five-year period under the Specific Skill Workers modality.
Earlier this year, Israel recruited Nepali workers for caregiver jobs for the first time in a decade. There was an overwhelming response for over 1,000 caregiver jobs as more than 26,000 people applied online.
As many countries besides the UK, Japan, and Israel opening their doors to skilled Nepali workers, there are new opportunities for Nepali professionals to work abroad. However, it also raises a big question whereby young and skilled people migrate to other countries as the government fails to create an environment to retain them for the process of nation building.
And, there is already a growing trend of Nepali students going abroad for higher studies. With the Covid-19 pandemic subsiding, there has been a huge surge in the numbers of Nepali students taking no objection certificate (NOC) from the Ministry of Education. It is highly likely that the majority of the students flying abroad will not return to Nepal after the completion of their university education.
While Nepalis working abroad send remittances which is the lifeblood of the Nepali economy, it has come with a huge cost. Nepal is losing the workforce that is needed for the nation’s development. Many sectors such as health, engineering, information technology and hospitality are already under big pressure as employers of these sectors struggle to find skilled professionals.
Post-1990, Nepal has seen big changes in the governance system with the most significant being the promulgation of the new constitution in 2015 and the adoption of the federal system of governance. Despite far-reaching changes on the political front, the past three decades are also a period when Nepal saw youths fleeing the country in droves. Particularly in the last two decades, each passing year has recorded an increasing number of people traveling abroad for study and work purposes, except for 2020 and 2021 when international travel was severely disrupted due to the Covid-19 pandemic. As a result of the government’s failure to foster an environment conducive to employment generation and entrepreneurship opportunities, smart and brilliant minds are moving out of the country leading to a situation where there is a serious crunch of human capital in various business sectors.
According to the Educational Consultancy Association of Nepal (ECAN), as an association of agents of foreign educational institutions, at least 60,000 youths are expected to travel to foreign lands for further studies in 2022. According to Prakash Pandey, President of ECAN, the number of outbound students has increased significantly as the Covid-19 pandemic subsides.
The Ministry of Education, Science and Technology is currently issuing around 1,200 no objection certificates (NOCs) every day to Nepali students for foreign studies.
“The number will grow further next year as students were unable to travel due to the pandemic,” he said, adding that at least 25,000 youths are going to Australia in 2022. “The number of students migrating to countries like the United States, the United Kingdom, Canada, Germany, Japan, among others, is increasing post-pandemic.”
According to the data provided by the Department of Immigration, 3,500 Nepalis on average are flying from the Tribhuvan International Airport every day as students and migrant workers. Similarly, the statistics compiled by the Central Bureau of Statistics show that more than two million Nepalis are residing abroad, but experts say this number exceeds more than 4 million.
While talking to the HRM, the office bearers of associations of doctors, engineers, chartered accountants and nursing say that a huge number of skilled youths are migrating abroad as students, and only a very few come back after graduating.
According to the Nepal Medical Association (NMA), as many as 30,000 doctors, including dentists, are registered with the Nepal Medical Council. Of them, only 18,000 doctors are currently working in Nepal, according to NMA. As per the recommendation of the World Health Organization (WHO), countries need to maintain a doctor to the population at 1:1000, but Nepal’s ratio stands at 1:1700. Nepal already has a huge shortage of medical doctors, but at least 300-350 doctors are migrating abroad every year, say, medical professionals.
The same is the case in the nursing sector. Nepal currently has 72,550 registered nurses, of which, 25,000 are working in foreign lands. The nurse-to-patient ratio for general beds should be 1:6, but Nepal has been struggling to meet the recommendation of the WHO, according to the Nepal Nursing Council. Health sector experts say that the shortage of nurses will exacerbate in the coming days as the government has signed agreements with the United Kingdom and Israel to send nurses who will receive big salaries than they are getting here.
In the Engineering sector, the situation is even worse. At least 71,000 engineers are registered with Nepal Engineering Council, and experts in the sector say more than 55 percent of Nepali engineers have migrated abroad for better opportunities.
The domestic IT industry is one of the sectors hardest hit by the flight of human capital from the country. Nepal produces an estimated 16,000 IT graduates every year. Of them, more than 6,000 go overseas for further opportunities, say IT, stakeholders. Besides, there is also a trend that those who stay in Nepal either work for foreign companies through outsourcing firms or work in domestic companies for a certain period before starting the process of applying abroad.
The hospitality industry is another reeling with the dearth of skilled human resources at present. Talking to hoteliers, it became clear how hotels are facing difficulties to get chefs who are an essential workforce in the hospitality business.
It is estimated that some 2,500 graduates are produced by hotel management colleges in Nepal annually. Similarly, hotel management training institutes also produce around 6,000 trained personnel every year. However, over 70 percent of this human resources leave the country yearly to work abroad creating a huge shortage of workforce. With the growing number of hotels across the country, this shortage has deepened in recent years.
Better Paycheck and Opportunities
Sagar Bastola, who recently graduated in computer engineering, is currently working at a private firm and makes just Rs 20,000 a month working for 8 hours a day. Bastola’s parents spent almost Rs 800,000 for his undergraduate studies from their savings and borrowing. Bastola says, “How can one hope to survive on a mere Rs 20,000 for working an entire month? If I don’t get freelance jobs, I can’t even imagine surviving in Kathmandu.” Observing that it will be difficult for Bastola has already applied to a few universities in the United States. He is hoping to fly to the US in mid-August.
A recent MBBS graduate, who is working at a private hospital in Kathmandu expressed his frustration over the paycheck he receives as a doctor. “I make Rs 40,000 a month. My parents spent a total of Rs 5.5 million on my studies. How long do I have to work to earn at least half the amount spent on my studies? And a postgraduate degree is even more expensive than MBBS,” said the doctor who wished not to be named.
According to Dr. Suman Acharya, President of the National Resident Doctors’ Association Nepal (NRDA), it requires over Rs 5 million to study MBBS. But a medical doctor gets Rs 42,000 in monthly salary. “How will students be able to get enrollment in post-graduate level earning so less? No student can save Rs 2.5 to 3 million working for 2-3 years,” he said. At least 2,000 MBBS students graduate from private and government colleges every year. But there is a huge gap in enrollment as only 700 students are enrolled for postgraduate courses in both private and government medical colleges. “This is why MBBS graduates are going abroad in large numbers,” mentioned Dr. Acharya.
Dr. Shiva Raj Adhikari, Head of the Central Department of Economics at Tribhuvan University, thinks that the government and the private sector have not been able to utilize skilled human resources and have failed to create opportunities for youths to stay in Nepal. “The political leadership has failed to create a conducive environment though the political systems have changed over the past few decades. If youths are getting better opportunities and are earning more abroad, they will not return to the country,” said Dr. Adhikari.
“In this globalized world, you can not stop people from migrating. You have to create better opportunities to retain them.”
Prof Dr Tri Ratna Bajracharya, who is also former President of the Nepal Engineers’ Association, observes that Nepali students are studying and earning at the same time in foreign lands and that they are less likely to come back home where they will get limited opportunities and benefits.
Job market experts say that the job cuts and unemployment caused by the Covid-19 pandemic have accelerated the flight of human capital from the country. For instance, almost 80 percent of chefs, who were laid off from their jobs during the pandemic, are now abroad for foreign employment. “They are receiving good salaries and have job security. In developed countries, it is not like in companies in Nepal where people lose their jobs during difficult times,” said an HR professional at a five-star hotel in Kathmandu.
At a time when Nepal is facing a huge dearth of skilled human resources in almost all sectors, the government, as well as state agencies like the National Planning Commission (NPC), have not been able to come up with proper policies, plans, and actions to stop the brain drain. “The focus is just on getting remittance by sending young people abroad,” said Baskota.
Even though Nepal is already facing a dearth of workers, the government is searching for new labor destinations to send Nepali workers abroad. The government, this year, is preparing to sign labor agreements with some European countries, including the UK to send high-skilled workers.
ECAN president Pandey thinks that unless the government comes up with concrete plans and actions to generate jobs and improves the education system, Nepali youths are not staying ‘just for the sake of love of this country’. “It is high ranking bureaucrats and politicians who are sending their children abroad for further studies,” he said, adding, “It shows that those who are in the policy-making level and the government themselves do not have faith in education plans and policies.”
Binda Ghimire, Registrar of Nepal Nursing Council says that Nepal already has a massive crunch of nurses and that it is an irony that the government is sending 10,000 nurses to the UK. “Nepal has just enough nurses to maintain the nurse-to-patient ratio. As of the latest data, 10,000 nurses are unemployed in Nepal. The government has created 14,000 positions for nurses at public hospitals and healthcare institutions, but 5,000 positions are still vacant. Rather than opening vacancies, the government is planning to send skilled manpower to foreign lands.”
At present, 4,500 PCL-level nurses and 1,000 bachelors-level nurses are produced annually in Nepal. The number of graduates is declining further as the Medical Education Act, 2075 has a provision that a nursing college must have its own building with at least 100 beds.
“Now there are only 35 nursing colleges, and Nepal now has the capacity to produce only 1,500 PCL nurses and 300 bachelors nurses every year. The number of graduates is declining despite the dearth of nurses. We are heading towards a massive shortage of nurses in the next few years,” said Ghimire.
According to NRDA President Dr. Acharya, the reluctance of the government to open vacancies for doctors has also forced medical doctors to find opportunities abroad. It has been 4 years since the Public Service Commission (PSC) issued vacancy calls to fill existing posts. A total of 100 doctors were hired by the government in 2017, and since then, PSC has not announced vacancies. “The government has no data on how many doctors are required for public healthcare institutions. Currently, Nepal has as many as 1,200 permanent doctors in government service. The number is extremely low, given the shortage of doctors in government hospitals,” said Dr. Acharya.
The vacancies have not been opened since 2017 as the Health Ministry has been reluctant in doing so under the excuse that the adjustment of doctors at the federal and local levels is yet to be completed.
Dr Acharya also gave another reason behind the exodus of doctors. “There is a mandatory provision for MBBS graduates to have a gap year of up to 2 years. In the gap year, MBBS doctors need to work mandatorily. They can’t join post-graduate courses. In that period, many doctors prepare for foreign studies,” he said.
“Likewise, MBBS graduates want to work under the supervision of senior doctors. But in many villages and rural parts, MBBS doctors have been working without the supervision of seniors in many health institutions. This is also another reason why they want to leave Nepal and study abroad,” he added.
Even the bureaucrats express their frustration for not being able to stop the flight of human capital from the country.
According to a joint secretary at the Office of the Prime Minister and the Council of Ministers, the government doesn’t listen to the suggestions of stakeholders to stop young people from migrating from Nepal to work elsewhere. “The government and the whole system are running on an ad hoc basis. It just wants Nepalis to go abroad to send remittances,” said the joint secretary under the condition of anonymity.
Targeting the unemployed youths, the government implemented the Prime Minister Employment Program (PMEP) in 2019, but the program has just become a platform for political parties to distribute money to their cadres and misuse taxpayers’ money.
Political Interference and Mockery of Meritocracy
Be it education, healthcare, or public services, political interference has badly affected many sectors in the country.
The government-run universities and colleges are the biggest examples in this regard. Talking to students of these educational institutions who solely want to focus on their studies will reveal how frustrating the education environment has become over the past years. This has affected the quality of education in the institutions prompting students to go to other countries to complete their higher studies and ultimately settle in their lives abroad.
“An organization like a university should be autonomous. But it is a shame that the political leadership has never realized this and has let the entire education system of the country be politicized heavily,” said a lecturer of journalism and mass communication at Ratna Rajya Laxmi Campus under the condition of anonymity. “In Ratna Rajya Campus, a group of lecturers recently padlocked the room of the chief of the campus. What do students learn from teachers in such a situation? And the so-called student unions are just wings of political parties with their own vested interests.”
Political interference in education is in fact a deep-rooted problem in Nepal. Even the laws governing the universities have been formulated in such a way that gives way to interferences. currently, there are 11 universities in Nepal, and all of them have Acts that mandate the Prime Minister to be the Chancellor and the Education Minister to be the Pro-chancellor of the institutions, and that the vice-chancellors and other top positions are appointed on the basis of their political affiliations.
According to Samikshya Baskota, a leader of Bibeksheel Sajha Party, Nepali youths have got lucrative jobs in foreign lands, but the same youth fail to land a job with the same nature in Nepal.
Nepal is Growing Old
For a country like Nepal where people have bragged about having a young population, the preliminary report of the National Population Census 2021 has shown some shocking facts. As per the statistics, Nepal’s population grew by an average of 0.93 percent, the slowest growth in 80 years. It is primarily because a large number of women and men of reproductive age group are residing abroad and many people in the country are following their suit.
These statistics show that Nepal will not be a young country in the next 2 and a half decades. “The number of young people continues to decline as the growth is less than 1 percent. This is the time to act and utilize the young population for the development and prosperity of the nation,” said Dr. Adhikari, adding, “Once these young people grow old after two-three decades, a huge resource will be spent on healthcare and allowances.”
Giving examples of how developed countries are luring brilliant minds, he says Nepal needs to protect its youths from migrating abroad by creating lucrative opportunities.
As per official data, Nepal’s unemployment rate stands at 11.4 percent and the unemployment rate is highest among young people aged 15-24 and 25-34 years. When the unemployment rate is so high, the active population migrates, and ultimately the economy suffers, say, economists.
It is estimated that almost 500,000 youths enter the job market every year in Nepal. And the majority of these youths migrate to foreign countries in search of better opportunities.
Every Sector has Human Resource Crunch
After the subsiding of the Covid-19 pandemic, the private sector is on a hiring spree as economic activities have gathered momentum. Nonetheless, finding the right talent is proving an uphill task for organizations.
Talking to the HRM, HR professionals say that the majority of skilled and semi-skilled youths are flying abroad for better opportunities creating a short supply of workforce in the job market and it has equally become difficult for organizations to retain their employees.
“Last month, as many as 6 staff at Hyatt Place left their jobs and most of them are already working in different countries. The hotels based in the Middle East countries are aggressively hiring skilled Nepali chefs and other hospitality professionals. To tackle the problem, we are currently hiring fresh candidates and providing on-the-job training,” shared Pramod Thakur, Human Resources Manager at Hyatt Place, Kathmandu.
The overall hospitality sector, according to him, is facing a serious crunch following the Covid-19 pandemic. “This can be changed only if hotels provide better salaries for employees. If hotels can pay 3-4 times more to foreign employees to work in Nepal, they can retain Nepali staff by increasing their salaries by double,” he added.
Entrepreneurs and HR managers of IT companies say that the scarcity of human resources in the IT sector has aggravated post-pandemic. According to them, after developed countries eased their travel restrictions with the subsiding of the pandemic, graduates who had planned for a long time to go abroad for their further studies, began to leave Nepal in large numbers leaving the IT sector high and dry for a qualified workforce. The migration of the IT workforce is also occurring in the wake of the digitization accelerated due to the pandemic as western countries are aggressively working in the field of IT.
Nepal produces around 15,000-16,000 IT graduates every year. Of them, more than 6,000 go overseas seeking better opportunities. Besides, there is also a trend that those who stay in Nepal either work for foreign companies through outsourcing firms or work in domestic companies for a certain period before starting the process of applying abroad.
“As it has been extremely difficult to get quality human resources through vacancy calls, companies have started to headhunt skilled professionals. In recent times, companies have started headhunting individuals. They have raised the salaries of new recruits by 10-20 percent. The retention of employees, in this difficult situation, has been a tough job for companies,” Mukunda Pokharel, founder of Rigo Technologies Pvt. Ltd., had said a month ago talking to the HRM for coverage which was published in the previous issue of the magazine.
Reversing Brain Drain
Given the current state of the country’s economy and the job market, checking the brain drain is a monumental task for the government and the private sector, say experts. According to Er. Dr. Hari Darlami, President of Nepal Engineers’ Association, much needs to be done to change the mindset of youths and create better employment opportunities at the same time.
“First, there is a need to improve the education system by updating syllabuses as per the international standards. For example, engineering education should be more focused on practical-based knowledge. Our syllabuses are already outdated. Second, the government should not allow students and teachers to engage in active politics in colleges and universities,” he said. He says that 55 percent of Nepali engineers are currently abroad. “To bring them back, the government should plan to build big infrastructures to offer the engineers lucrative job opportunities.”
Experts say that workers, whether they are skilled, semi-skilled, or unskilled, have an equal role in nation-building. Both the private sector and the government should work together to enhance the skills of semi-skilled and un-skilled workers. The problem is that the government lacks data related to human resources in Nepal. According to experts, the government must establish a research and development (R&D) unit that will provide a clear picture to come up with plans and actions for employment generation.
Likewise, funding students and professors for research and studies can also help reverse the brain drain, say experts. In developing countries like Nepal, at least 70 percent of youths are self-employed as companies and the corporate sector cannot provide job opportunities to all. “At least the government should ease the small business registration process and subside small and cottage industries to stop youths from migrating,” says Dr. Adhikari.