The Jamaican Diaspora: A Labor Crisis or Untapped Investment Potential?

With a relatively small domestic population of about 2.881 million, Jamaica is certainly well-represented by emigrants around the world, particularly among its biggest trading partners (U.S., Canada, U.K.). According to the IMF, there are currently almost as many Jamaicans living abroad as there are on the island. This ‘Jamaican Diaspora,’ (dubbed “the brain drain” by the IMF’s Resident Representative for Jamaica, Constant Lonkeng Ngouana) poses two major challenges for the country. In the long term, Jamaica must “[maintain] an economic environment conducive to a vibrant labor market that would retain Jamaica’s trained labor force within its boundaries.” More immediately, however, it could take advantage of the Diaspora to seek potential benefits from increased overseas investment.

A 2013 World Bank study, “Diaspora Investing: The Business and Investment Interests of the Caribbean abroad,” explored a huge potential for investment in the Caribbean by educated emigrants. The study interviewed 850 members of the Caribbean diaspora, 65% of whom have Jamaican origins. According to the World Bank, 23% of these emigrants already invest in startups in the Caribbean. Many expats are also involved with charitable organizations benefitting their home countries (such as – Jamaicans Abroad Helping Jamaicans at Home), and 90% want to get more involved with the region. 50% of the study’s respondents currently live in London, New York, Toronto, or Miami, representing three nations among Jamaica’s most important trading partners. The World Bank says that some hurdles to exploiting this potential include regulations and limited visibility of investment possibilities.

A recent study by the Caribbean Policy Research Institute, “Value of the Diaspora to Jamaica’s Growth Agenda,” assessed the Diaspora’s effect on the nation (beyond remittances). A July Jamaica Observer article, “Gov’t red tape clogs Diaspora investment,” reacts to this study and criticizes the Jamaican government for failing to take advantage of untapped potential. The Jamaica Observer also emphasizes the Diaspora’s beneficial effects on the US economy, claiming that US$12.8 billion is lost annually in unexploited revenue. At a July Jamaican Stock Exchange meeting, Marlon Hill told Diaspora emigrants, “You have a choice as to where you put your money — Wall Street or Harbour Street.” The JSE wants to double Diaspora investment in the country by 2019.

While the long-term implications of this outward migration are arguably destructive for Jamaica’s labor force, increased Diaspora investment could present a promising short-run growth opportunity for a nation experiencing an average annual real GDP growth rate of only 1%.

Some questions to consider:

  • Is this trend of outward migration sustainable for Jamaica’s workforce? How can Jamaica entice its educated, skilled workforce to stay on the island?
  • How does Jamaica’s response to net emigration differ from other developing countries experiencing similar phenomena?



Elyse Ferris and Jimmy Fleck

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17 Responses to The Jamaican Diaspora: A Labor Crisis or Untapped Investment Potential?

  1. lencionik19 says:

    I had not heard of a diaspora before reading this article and I am surprised that there are almost as many Jamaicans living abroad as there are on the island itself. This presents a specific challenge to Jamaica’s national economy that I had not considered before. One question I have is what kinds of people are the ones leaving the country? Are they skilled laborers who see more potential for personal success in other countries? Or are more of them people who don’t have much going for them and decide to start over in a different setting? It is important for Jamaica to retain its skilled workforce in order to increase economic development. I believe that if the country was able to increase investment in their own country and discourage people to leave, then it would have an exponential effect. As the country continues to develop, there will be more incentive for more Jamaicans to stay home and further the development. Jamaica must focus on the homeland development (specifically increasing the GDP growth rate) before it focuses on overseas investment.

    • inglism18 says:

      What shocks me even more is that the diaspora is present even in a country with such a small population relative to many nations. Of course there are economic implications that come with this such as the possibility for enhanced short-term growth, as Elyse and Jimmy point at, but there must also be some sort of identity implications. With so many Jamaicans abroad, is the notion of Jamaica one of a small nation or of a population that simply inhabits this nation among others? Will the Jamaican people become predominantly located elsewhere?

      Furthermore, when looking at poverty statistics, is it appropriate to simply view those living in Jamaica? It’d be interesting to see how factoring in the Jamaicans abroad affects these statistics, especially if they are keeping their money on ‘Harbour Street.’

    • the prof says:

      Re “not much going for them”

      The migration literature (I know that focused on internal migration in China) is that migrants tend to be more ambitious and more educated than the average. Certainly we can (will !) develop a push-pull model. To rephrase: if you’re not making it at home, why would you do better elsewhere? Will you (extended) family provide you with the funds needed to migrate?

  2. bryantc18 says:

    Very interesting trend for sure. It does not seem particularly surprising, given Jamaica’s small size, limited opportunities, cultural ties, and proximity to the US and Canada. On the surface, migration of skilled labor would a major issue and unsustainable for an economy that seeks growth. However, I see a few potential benefits from diaspora. If migrants seek better opportunity elsewhere, it cause that money to return someday, as indicated by your research on diaspora investment. Or, if migrants gain high-quality education and training in other nations, they could conceivably return and enhance the quality of the labor force. This would require incentives for sure–perhaps the Jamaican government could fund scholarships for Jamaicans to study and train abroad, with conditions to return one day. I’m just throwing around suggestions here, but this general idea of promoting educational and vocational opportunities and/or investment from abroad is important. Perhaps the Jamaican diaspora could form trade networks that facilitate increased exports from Jamaica to the countries they reside in. I know that the Chinese diaspora exerts this type of influence on trade–their networks have been shown to increase Chinese trade to wherever they reside. In any case, Jamaica should not seek to rely on its diaspora for investment, but should find ways, if possible, to strengthen its competitiveness at home. The diaspora question is fascinating though.

  3. wheelers19 says:

    The first thought that comes to my mind is whether or not Jamaica really requires a substantial skilled workforce. Jamaica’s economy is highly dependent on tourist income and those occupations are generally low skilled service sector jobs. By uncharging tourist and service industry goods to tourists who have disposable income and no other options than to pay the price demanded, it seems that the economy could do quite well on this alone.

    • inglism18 says:

      Are these tourism and service industries sustainable? In Jamaica, perhaps they are. However, how would the country be affected if some external factor impacted tourism in the region? Promoting diversity among GDP drivers is essential so as to prevent that case. A country may start off with primary drivers, but once there is an opportunity to include other industries in that equation, it’d be wise for Jamaica to ensure that it’s not putting ‘all of its eggs in one basket.’

      • ferrise20 says:

        That’s very true – A topic we hope to explore further is Jamaica’s vulnerability to natural disasters. Although it’s gotten by alright this season, hurricanes always pose a major threat to that industry, which accounts for a significant chunk of Jamaica’s workforce and GDP.

    • the prof says:

      Running a hotel, moreso a resort, is a highly skilled occupation. Ditto running a restaurant. You can (I believe) get a masters degree in hotel management at Virginia Tech. The school at Cornell is world-famous.
      But even if there’s not much high-tech manufacturing, Jamaica still needs doctors and lawyers and nurses and accountants and … some of which are potentially “mobile” skillsets.

  4. platerb18 says:

    To compare Jamaica’s diaspora investment to another country, we can look nearby to Mexico. They are similar in having large percentages of emigrant populations in the United States, but Mexico has gone about embracing the remittances received from abroad. This money has created the opportunity for development in some of the nation’s poorest areas. Money is going directly to families in Mexico, while in Jamaica, money is going to businesses and charities. It is unclear whether that same family dynamic is also occurring in Jamaica, or if entire families are leaving the country together. Is money directly to families more efficient, or is it not fair to compare the two countries as far as diaspora investment goes?

  5. shelbyc18 says:

    This Jamaican brain drain is unique to the emigration seen in the other developing countries that we have presented on because of the island’s reliance on tourism and small population. Wealthier emigrants investing in the island helps the economy short-term, but turning it into a service economy requires an educational system overhaul to improve human capital. With environmental change and the degradation of coastal marine environments, improved human capital is important to the success of Jamaica if/when their tourism industry dwindles. However, why would Jamaicans in New York City or Miami want to invest in Jamaica when they live a better life in the United States?

  6. the prof says:

    So I see three issues here:
    • brain drain, which you have picked up on
    • reverse migration and
    • remittances
    In other words, to what extent does the diaspora maintain close ties to the homeland?
    Note that all of us are products of earlier diaspora. In my case, they’re too far back in time to know much, except that one 17th century Dutch ancestor – who owned Wall Street!!! – went home at least once for an extended stay. Don’t presume migration is one-way, once and over.

    that Wall Street was not in New Amsterdam but in Albany

  7. mac zheng says:

    Jamaica is an economy dominated by services, representing 70% of their GDP. Jamaica in most people’s mind conjures up thoughts of tourism, which indeed represents a fair share of their service industry. Therefore, the country relies alot on foreigners. With an outflow of native Jamaicans, does that really affect their tourism industry? If this diaspora is recent, then it may take some time for effects to show. I am with Wheeler in the sense that because tourism does not require a majority set of workers to be highly skilled, then this diaspora does not prove a major effect on their economy in the short term. This argument is based around the hard fact that tourism is their primary economic driver.

  8. the prof says:

    Look at Rockbridge County as similar to Jamaica, but with cheaper migration.

    In the 19th century tourism was big, people would arrive by train to “take the baths” – there were quite a few large, wooden hotels in places that are now ghost towns. The development of the car changed that, because it was not convenient until the arrival of the interstate: I-81 as not fully open in this part of Virginia until the 1970s and I-64 was finished only in 1988. On the flip side, farming isn’t great, iron didn’t turn Buena Vista into a boom town, and so on.

    So out migrants mattered: Sam Houston, Cyrus McCormick and Cy Twombly are but 3 examples of those who became famous. Ditto those who made money but didn’t become well-known. No great fortunes led to corporate HQ here.

    Did our “brain drain” hurt the community? How about reverse migrants? Money? For the latter, many of the newer businesses are founded by return migrants, at least if we include W&L and VMI alumni in that crowd.

  9. willinghamt19 says:

    This is a very interesting article. I have often discussed “brain drain” as largely a negative phenomenon. The article offers a new perspective for me by stating that the Jamaican Diaspora could (possibly) be a positive. I wonder how much more growth Jamaica could experience from investment and physical capital though. Could it be that the human capital and TFP loss far outweighs any investment these individuals could provide. On the other hand, would these individuals have received a comparable education in Jamaica. My intuition says probably not. Perhaps philanthropic investment from educated Jamaicans living outside of Jamaica could positively affect TFP and human capital.

  10. nutiw18 says:

    This is a really tough issue. Highly educated Jamaicans have no incentive to stay in the country, as pay and opportunity abroad are greater. Investment into their own industries could help, but results would take a very long time to appear. However, by establishing modernized industries, Jamaica could slowly decline their reverse migration.

  11. khanm18 says:

    Super interesting article. Why would Jamaicans have any incentive to stay in a nation with no economic opportunity when there are some close, neighboring countries such as the U.S. and Canada that have so much better opportunities. Besides, in agreement with other articles, it seems like the Jamaican economy thrives off of its tourism industyr. How important can this diaspora be to a nation so small?

  12. the prof says:

    What are the real wages of skilled professionals in Jamaica? I suspect a doctor can employ a full-time servant to cook and clean. Not so easy in the US!

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