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Hiring foreigners 'good for business': study

Hiring foreigners 'good for business': study

Published: 06 Sep 2012 13:59 GMT+02:00
Updated: 06 Sep 2012 13:59 GMT+02:00

Employing foreign workers can mean a boost for businesses in terms of increased trade and competitiveness, a Swedish study has found.

According to the report, published on Tuesday in the Swedish journal Ekonomisk Debatt, a typical Swedish manufacturing company can increase export sales by over 2 million kronor ($300,000) by hiring a foreign-born worker.

The study, which is based on on data from 7,000 Swedish manufacturing companies from over a ten-year period, also found that hiring a foreign-born worker can increase imports by 12 percent.

“Our study indicated that employing people from outside of Sweden can help overcome barriers to trade with countries where that migrant comes from,” said researcher Magnus Lodefalk of Örebro University to The Local.

Just one extra percentage point of diversity in the work place equates to 9 percent higher export sales, the study shows.

“As a result, the foreign worker brings more information for the firm in terms of how to do business with that person’s home country, the culture… having more foreign-born workers basically leads to more knowledge.”

Furthermore, Lodefalk explains that the 'migrant' workers provide firms with a larger network within which to trade, as the hiring of a foreign worker opens the doors to connections with relatives, friends, and former school mates in their home country.

“It becomes a valuable way to monitor new markets,” Lodefalk explains.

The results of the study could even be used to fight what Lodefalk refers to as potential discrimination in the workforce.

“If you look at foreign-born people in Sweden versus native Swedes, there can be cases of discrimination in the workplace. There is historically a problem of matching work with the level of education," he said.

In terms of whether the results can be used more widely outside the area of manufacturing, Lodefalk explains that the team was researching uncharted territory and that it would be hard to see where things will go from here.

“We were the first to publish a study on this topic at the level of a firm – it’s deeper and more serious than other similar studies. Now, we can look deeper into our findings and analyze what the results may mean in a broader context,” he told The Local.

Oliver Gee

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The Local (news@thelocal.se)

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Your comments about this article

15:25 September 6, 2012 by Programmeny
Yeah, too bad employers don't know this and don't act on it. I've been looking for work for over a year, finished master in Sweden in communications and marketing, speak Swedish (well, not fluent but getting there) and still nothing. Maybe the laws in firing someone have to be changed to a more relaxed state, that way employers would be more flexible.
15:28 September 6, 2012 by azimuth
LOL You don't say! :D
17:03 September 6, 2012 by Rishonim
That would be a drastic change all of a sudden. Swedish company wouldn't even hire people who were born here with foreign parents. I know a couple first generation Swedish born guys with MBA's from KTH unable to find work because their names are not Mattsson
17:51 September 6, 2012 by Programmeny
Well in that case Sweden doesn't leave you any chance but: come here, take advantage of the money invested in your through free education, and then leave.
09:58 September 7, 2012 by bourgeoisieboheme
This is not a blanket statement, it really depends where the foreigner is from! Do you mean a PhD from Harvard or a Somali sheep herder. Reports like this do little good unless they are more specific! Otherwise there are hundreds of millions of Chinese farmers Swedish technology firms could hire to increase the bottom line...
10:35 September 7, 2012 by johan rebel
Probably true, as long as you do not hire illiterates whose only previous work experience is herding goats and sheep in the desert.

It would help if Swedish immigration policies took this simple fact into account.
12:54 September 7, 2012 by krattan
So interpreting this study it's good for Swedish business if Sweden welcomes workers from established economies/markets. So what's wrong with the current picture ?

The current state of economics in Sweden vs Europe points to that Sweden has a huge advantage and opportunity to welcome immigrants from the rest of Europe. Maybe those immigrants Sweden is said to have been in need of for the last 20 years just are right around the corner instead of........
22:25 September 10, 2012 by Peter1234
I hope the said is true. I came to Sweden about 1,5 years ago. I hold a master degree in engineering, could bring in several years of international management experience and am thankful that it simply happened to me ending up in Sweden. It was not planned from my side at all to work here. True that the taxis are high here, but you get something for it: It is a safe and very good place to live and I will do my best to help the company I am working for. I hope that the Swedish government despite the Euro crises will continue to follow its path of a balanced budget and low depth. Such stability will be for the sake of everybody in this and the next generation!
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