As stores unfortunately go out of business and several organizations mourn their losses, we cannot underestimate the dire effects of the COVID-19 pandemic on businesses. The bewildering and ferocious virus continues to expose why brick and mortar organizations may become a thing of the past if they do not restructure and redesign their business models to reflect the changing times. For entrepreneurs, particularly in industries such as information technology and product manufacturing, one of the things to consider in order to keep your business running in these disconcerting times is hiring skilled remote foreign workers. Whether you actively recruit foreign workers, or they happen to apply for vacancies in your organization, considering the benefits of hiring them will go a long way to adding value to your business. This post will discuss the advantages of hiring foreign workers during the pandemic.
Foreign workers are people who work in a country other than one of which they are a citizen of. Hiring a foreign worker should not be confused with the debate over hiring immigrants which is not the subject of this post discussion.
Multinational companies such as Wal-Mart and Microsoft that employ a fifth of all American workers hire foreign workers alongside local labor. This demonstrates the inter-connectedness of our world today.
Proponents of local hiring are of the view that hiring foreigners will mean jobs being taken away from local workers in communities and the country as a whole. However, this belief has been proven to be false. Au Contraire, foreign workers, raise the productivity of U.S. businesses and stimulate the economy. Now here is why you should consider hiring skilled remote foreign workers in such unsettling times:
Save Your Business A Lot of Money
Hiring skilled foreign workers to work remotely saves your business a lot of money. According to the Internal Revenue Service, wages earned by foreigners for services performed outside of the United States for any employer are foreign source income and therefore are not subject to reporting and withholding of U.S. federal income tax. Additionally, as an employer in the United States, your business will save money by not having to pay the Federal Insurance Contributions Act (FICA) contributions. These include U.S. Social Security Taxes (6.2%) and Medicare (1.45%). That’s a savings of 7.65% for you as an employer according to the current rates. By having your foreign employees work from home in their respective countries, you save money, and you do not have to provide physical structures to accommodate them.
Promote Diversity of Thought
A necessary element for innovation and problem-solving is diversity of thought. Hiring skilled foreign workers will promote diversity of thought in your business. All your customers or clients are not like you and will not be like you. They represent different backgrounds, educational status, economic backgrounds and experiences. Hiring foreign workers means that the needs of these different groups of people are catered for. Having a mix of skilled workers will bring in creative and fresh perspectives as the foreign workers will also contribute what they know and learn from their countries. Their different set of skills will go a long way to add to your business profitability.
Expand Your Business Globally
The United States is not an island. If COVID-19 has taught us anything, it is that we are so deeply connected to all the countries in the world as a result of globalization. The health of one economy affects the health of the other. In this era, businesses are not only competing locally but globally as well. Having skilled foreign wor
kers on your team will provide the necessary networks and resources needed to expand onto the global market much more seamlessly.
Bring in Skilled Labor to Boost the Economy
Bullhorn’s 2018 North American Staffing and Recruiting Trends Report states that 73 percent of organizations serving manufacturing industries, and 65 percent of those in information technology and accounting, finance, and insurance fields listed skill shortages as one of their top challenges. In manufacturing alone, the National Association of Manufacturing and Deloitte projected that the United States will need to fill about 3.5 million jobs by 2025; yet as many as 2 million of those jobs may go unfilled, due to difficulty finding people with the skills in demand. By hiring foreign workers, you will be ahead of the curve. You would have potentially found a solution to a difficult situation that looms in the near future, positioning your company to have a competitive edge over other companies.
Avoid Visa and Immigration Requirements
If you are a small business, you may be concerned about the legal and immigration hurdles of hiring skilled foreign workers. The good news is that, if the foreign worker will not be living in the United States or performing work on American grounds, you do not have to worry about the acquisition of work-visas. If you decide to bring a foreign worker into the United States, then you would need to obtain a visa and the proper documentation.
Because immigration policies change all the time, it is always a good idea to seek legal assistance when you are drafting contracts for foreign workers and setting them up to work.
If you are not tied down to hiring an employee from your country, city or state, you should consider hiring skilled remote workers living abroad, especially during these times and you would be sure to reap the benefits.
Sources:
https://www.emerson.com/en-us/news/corporate/2018-stem-survey
https://www.irs.gov/individuals/international-taxpayers/persons-employed-abroad-by-a-us-person
https://www.law.cornell.edu/wex/foreign_national
https://www.wsj.com/articles/SB10001424052748704821704576270783611823972
https://www.allbusiness.com/ins-outs-hiring-foreign-remote-worker-small-business-104746-1.html
https://www.irs.gov/taxtopics/tc751
https://www.investopedia.com/terms/s/social-security-tax.asp
Image sources:
http://rlegacy.co/5-ways-manifest-black-girl-magic-finances/
https://en.wikipedia.org/wiki/Visa_policy_of_the_United_States
About Me:
Maame Boateng, at the time of this post, is a 2L at Penn State Dickinson Law. Maame is from Ghana and is interested in corporate law and international law. Maame currently serves as an Associate Editor of the Dickinson Law Review, Vice-President of the Business Law Society, and Treasurer for the Black Law Students Association.
Hello Maame,
Interesting post! I enjoyed seeing this topic from your perspective. I think you laid out the benefits of hiring a skilled foreign worker well, but what can we do as legal professionals to help businesses hire these workers? I see that there is no work visa requirement, but are there other legal hurdles a business would need a lawyer to help them with?
Hi Maame,
I really enjoyed reading your post. I think you did an excellent job supporting your arguments with empirical data. I was surprised at how much money employers can save when they do not have to make FICA contributions. Do you think that employers will need the help of lawyers to establish contracts and employment engagements with remote foreign workers?
Hey Maame!
Great job and post (as usual )! You did a FANTASTIC job at giving a reasoning as to why businesses should hires skilled remote foreign workers during the COVID-19 pandemic! However, I am noticing that already happening! Companies like Fiverr provide an online platform for freelancers to offer services to customers around the world. The stock price of Fiverr (FVRR) has shot up over 1000% in the last year because of the massive profitability of remote work during the pandemic! I’ve particularly noticed that a good number of workers on the platform are from Nigeria, Kenya, or South Africa that are very skilled in technology and writing sectors – and that use the marketplace as it provides a higher income than work in their own country. With technology, the bridge to hire these incredibly well-skilled workers should be utilized more to help build other countries’ economies. I also realized that foreign workers do make up a great majority of huge corporations in the U.S. such as Wal-Mart, Amex, Citibank, T-Mobile and other banks that outsource their customer support to other countries such as the Philippines or India. I found it super helpful that you included information (and the relevant sources) that businesses can save money by not having to pay FICA contributions! That’s incredible as I don’t think most people know that! Thank you for your post, I found it inspiring and will definitely be using freelancers from around the globe once I start my business!