Not every country provides the efficient, transparent and 'livable' society of Singapore, Hong Kong or Sydney. Indeed, the majority of the world's economies are considered to be still 'developing', not yet at the 'developed' status of most of the Organisation for Economic Cooperation and Development (OECD) membership.
But while currently small, these economies cannot grow without appropriate skills. And that will typically mean foreign talent for many organisations.
Jumping into a developing economy is not for the feint-hearted. The disparity of incomes makes personal security a significant issue. Typical locations can also be affected by pollution, transport problems and an overall isolation from everything that the expatriate has known before.
So what keeps skilled expatriates in these seemingly less-desirable locations? Certainly compensation rates highly, particularly against the low cost-of-living background that many developing Asian nations boast. But, as this article demonstrates, there are a wide range of other factors that organisations looking to attract and retain expatriates in the developing world need to consider.
The hard life
Companies that assign staff overseas assignments often take the standard of living in the host location into consideration. Most will incorporate a location allowance into the overall compensation package. Lee Quane, Asia regional director for ECA International, an expatriate service provider, says localised pay is often called a "hardship allowance" - compensating staff for the reduced lifestyle and insecurity of their host country.
"At present, approximately 65% of companies worldwide include allowances in their employees' salaries which are designed to take into account differences in the quality of living between their home and host locations," says Quane.
He says localisation allowances mean a company can effectively recognise the changes employees are asked to make when moving to certain locations. They can also be used as a motivator - giving employees extra financial incentives to take on seemingly less desired roles.
The tax-free and low-tax environments of many developing countries also attract expatriates, says Tom Browne, manager of HR practice at Carmichael Fisher. Even if tax rates work against the moving party, many organisations will offer to make up the shortfall.
"Tax equalisation is a well-utilised method of both attracting and retaining expats overseas," says Browne, who handles a wide range of expatriate contract negotiations. "For instance, a Singaporean working in China will be used to a lower tax regime in their home country. By offsetting the difference it ensures that the China-based Singaporean remains tax-neutral and will not have to personally carry the burden of higher taxes than they enjoy in Singapore."
Staying put
"Fire the expats," says Muhammad Al-Hamdan, head of the Saudi Arabia Labour Office. He is on a mission to increase the rate of job localisation in the Kingdom and has urged companies to retrench foreign staff ahead of any locals in the firing line.
Saudi Arabian Basic Industries Corporation (SABIC) and Microsoft Saudi Arabia look set to heed the call. They have already announced plans to downsize; and several other companies are expected to follow suit in the weeks and months ahead. Even as the world economy looks set to recover from the credit crunch, future growth is speculative at best - and jobs are still on the rocks.
Research by Zurich International Life shows more than 50% of foreign workers in the United Arab Emirates and Bahrain are nervous about their personal job security.
Carlos Sabugueiro, CEO, Middle East and Africa, Global Life Emerging Markets, Zurich Financial Services, says expats are also being forced to tighten their belts. "It's clear that the current financial crisis is having an impact on professional expats," he says. "Around 80% percent of people surveyed in the two countries feel their ability to save has been decreased.
"Last year, all anyone could talk about was how to spend their bonuses and the continuing good times. Now they appear genuinely worried about losing their jobs."
Still, few expatriates are packing up and leaving the dwindling Middle East economy. The survey found 70% of respondents were prepared to see out the tough times in their current location - all seemingly confident about the long-term economic health of the region.
"Professional expats are here to stay and many of those who have spent 10 or more years in the region know that the Gulf has an amazing ability to bounce back very quickly," Sabugueiro says.
Clearly, there is something more than money - or even just the promise of future money - keeping expatriate professionals in the Middle East, as well as other developing regions.
Taking the kids?
Providing education for the children of expatriates is another way of retaining an international workforce. However, this can be a complicated process in several developing nations.
Firstly, suitable schools may not be available. Outside the capital cities of countries like China, India, Indonesia and Vietnam, international-standard schools are few and far between. Therefore, even if the assignee wants to take their children on assignment, facilities may not be available.
"In many locations, assignees prefer to leave their families at home, including children," Quane says. "Even if international schools are available, other elements such as poor security, high pollution level or poor infrastructure may combine to encourage the employee to leave their children at home during the assignment," reveals Quane.
Some organisations offer additional leave allowances in lieu, or in addition to hardship payments. "This benefit is often called rest and recuperation leave; and normally applies to locations with particularly adverse living standards," says Quane. He cites Pakistan, Papua New Guinea, Iran and Iraq as four Asian examples; as well as many locations in developing Africa.
As these locations are often not designated as 'family' postings, the additional leave allows the employee to maintain relationships with those remaining in the home location.
Managing expectations
Preparing international assignees mentally is another important aspect of retention. Assignments which inherently involve security risks a require staff to be adequately prepared prior to taking them up.
"Security briefings for assignments in locations with a high threat to personal security, such as Jakarta, Islamabad or Karachi, are essential," Quane says. "Likewise, pre-assignment preparation is essential to ensure that an employee is mentally prepared and the assignment is therefore successful."
Cheryl Tong, managing director, Pursuit Pte, says security is a huge problem throughout Africa. Based in Uganda, she says protection for both herself and the business is a vital concern. "Even though our warehouse is fortified with steel bars, thick firewalls, armed guards and attack dogs, thieves still managed to ransack our products."
For Browne, a number of extras are important additions to the traditional compensation package. "Compound living, car with driver and, in extreme cases, personal security guards are often used to entice expatriates to stay in environments with very real security concerns," he says.