The global race for high-potential migrants is heating up
An interview with Austin Fragomen FIMC, Chairman Emeritus at Fragomen for the IM Yearbook 2023.
Austin Fragomen shaped modern immigration practice like no other and built the largest migration focused legal firm in the world. In January 2023, he has passed on the leadership of the firm to Lance Kaplan and Enrique Gonzalez. The IM Yearbook caught up with Austin Fragomen to relive some of his career highlights and gain his thoughts on the current trends influencing global migration.
What memories or recollections do you have of your entry into immigration law?
As a law student I was very interested in international law, and I took as many international law courses as I could. When I graduated from law school, I went to work for the house judiciary committee, the US house representatives, and I became the staff council to the immigration subcommittee. Back then, the US immigration system was very much focused on family reunification and humanitarian immigration, and although it had some allowance for business immigration, this was limited.
When I arrived at the Committee in the 1970s, the big issue was how corporations could move people around the world. It was very laborious because there was no non-immigrant category that allowed for work on a temporary basis. I got involved in making changes to certain visa categories to ease the process. I thought this was a big growth opportunity, which turned out to be accurate. In the years that followed, companies really embraced these new methods and opportunities to move people around the world. We then decided to build an immigration practice, which had two prongs to it: the private client and the corporate practice. And we maintained this dual approach throughout the years.
Fragomen was founded in 1951 as Elmer Fried. Looking back, during which period did you experience the greatest growth?
In 1990, there was a major reform of the immigration Act, which greatly increased the number of visas allotted to business immigration and created the EB-5 category in the US. That provided a lot of additional opportunities. Previously, the US didn’t really have a programme for investment migration. Back then that space was dominated by some Caribbean countries, South American countries, and some other obscure places that I found most of the investors didn’t know where they were. I remember someone in Hong Kong once asked whether world maps are handed out along with the visas so that the investors knew where to go.
Meanwhile, we saw big demand for global representation from major corporations. They, of course, had operations around the world and asked us to represent them. We did that first through co- councel in places like Canada, the UK and Brazil. Then, in 1999, we opened our first foreign office in Belgium and subsequently got more involved in global emigration and represented people moving out of the US.
The private client side only got international following the introduction of the US EB-5 regional centre programme in 2005. Before that, the EB-5 system in the US was not very popular, it just had around 1,000 applicants per year. It simply was too complicated since investors had to have an active business with at least 10 employees.
What strategy did you apply to scale the firm and transform it from being a small boutique law firm into a global organisation?
In most countries, we were co-counseling with another law firm initially. We only opened our own office when we had enough critical mass. Frequently, the co-counsel would merge into our firm. Of course, the situation was a little bit different in each country. For instance, after PwC in Australia decided to divest themselves of their consulting businesses in the early 2000s, we bought the immigration business from them.
We never opened an office and then tried to get clients. We always made sure we had clients first. Our clients were mainly the global operations of US-based companies that we represented, so this made it easy to expand. Once the US regional centre system was established, we were able to look at US immigration. The first country – besides the Caribbean islands – which had a robust and active immigration system was Canada. We used that particularly for Asian and South African clients. As the residency and citizenship by investment sector really took off, it became a large part of our private client business.
What can you tell us about Fragomen’s footprint today?
We now have a staff count of some 6,000 people. The important thing is that through various layers of subsidiaries, we own all the offices that we have throughout the world, except for a few locations in Latin America where we have a network of providers with whom we have a different economic arrangement. Ultimately, we’d like to have offices in all the principal countries where there is enough activity and that warrant to have an office.
We have a handful of locations where we are going to be opening offices. We were a little bit late in South-East Asia, so we recently opened an office in Thailand, and will probably be opening offices in the Philippines and in Japan next. We didn’t have a good coverage there before. We had offices in Singapore, Malaysia, and China. We thought at some point we will have offices across China, but right now the business in China is impacted due to all the Covid-19 the restrictions. Importantly, however, in many countries we managed to build up local business, even in China we represent several Chinese companies for immigration purposes around the world. We are competing with the Big Four primarily, not with other law firms. They have offices everywhere, so it’s important for us to have offices in major locations that offer a certain volume of work too.
2022 marked the year where geopolitical tensions moved centre-stage again, and the economic outlook for 2023 has turned sour. How do you think this climate will affect investment migration?
The prospect of a recession hasn’t really impacted employment so far, but it will to a degree. We can expect that to happen, but it is not going to be anywhere near the impact that Covid-19 or the 2008/2009 financial crisis had.
More importantly, labour migration is a growing business, regardless of what’s going to happen to the economy. As long as we have population growth, labour migration will grow too. In fact, if you track the number of labour migrants against population growth, the growth line is pretty much the same.
I think countries will really start focusing on the skill gap problem that they have. Many countries need people with specific skills. However, their educational and training systems lag behind and countries are not able to fill those needs domestically. On top of it, there is the demographic problem, with several countries just not having enough workers. On the other hand, many developing countries are experiencing strong population growth. Therefore, migration will be a major factor moving into the future.
How can host countries best try to attract skilled workers?
I think countries need to and will start institutionalising their need for migrants, and they will further decouple work visas from employment. Some countries have already launched programmes to attract high-potential migrants. An example is the UK’s ‘High Potential Individual Visa’, through which graduates of the world’s top universities can get a work permit in the UK without having a job offer. Elsewhere, in 2021, Canada allowed about 50,000 foreign students to stay for 18 months after graduation to seek employment, during a time when the economy was reopening from Covid shutdowns and companies needed to hire.
I am certain we are going to see a lot more international cooperation. Countries will work closely together to place job seekers across borders. The Global Compact for Migration, which has been adopted by most of the countries in the world, sets up best practices for every aspect of migration. For the first time countries are really coming together and talking about how they can use migration as a tool for development. Moreover, the Global Forum on Migration and Development. I am the chairman of the private sector group in the Global Forum on Migration and Development, so I do a lot of work with different countries around the world on migration policy. We see a lot more coordination and transparency, as well as sharing of best practices. This is very different compared to the situation a few years ago.
Yet immigration remains one of the most controversial policy issues in many parts of the world, including the US and Europe. What thoughts would you like to share about migration, public opinion, and political support?
I think that the general attitude towards immigration is becoming more positive in the sense that people are realising that countries require some level of immigration. I think Covid-19 helped in a weird way because in many developed countries, immigrants made up a large part of the ‘essential workers’ that kept everything moving.
Moreover, countries are making statements about their need for immigration. For instance, Japan just said they need more people because they have a massive shortage of workers. Of course, what’s negative is irregular immigration. Since Donald Trump has announced that he wants to run for president again, I think we will have several more years of intense analysis of immigration in the US. Europe has substantial problems with irregular immigration too, but I think overall the attitude towards immigrants is slightly better.
In a previous interview with the IM Yearbook, you were not very convinced that start-up, entrepeneur or innovator visas would be economically successful. Today, almost every country runs these programmes. Have you noticed any significant improvements?
There’s a renewed interest in these programmes as countries are trying to attract innovators and entrepreneurs to create jobs. But I am still of the opinion that no one has figured out how to run them. How do you identify people who are the process of being successful?
Some programmes look at how much money a start-up has attracted from angel investors. However, the presence of venture capital doesn’t mean that you are going to have a successful company. However, I think we are going to see more digital nomad programmes, which are going to allow people to live somewhere and not have to make an investment. I think that offering will compete to some extent with traditional investment migration programmes.
India is currently one of the hottest markets for investment migration.
Yes, what’s interesting about India is that there’s a lot of circular migration. We see a lot of Indians coming to the US to study because they think they have more opportunities here and it’s a good career steppingstone for them, but many of them are returning to India, where they set up their own companies or take up senior positions in large Indian companies. It’s one of the big success stories in the migration field: People leaving a country, acquiring a higher level of education, and then returning and applying those skills in their home country.
What key lessons have learned along the way that would you like to share with practitioners across the world?
From my experience, and in retrospect, I can say that recessions or other forms of turmoil only have a minimal impact on migration. The one thing that we really need to be aware of are politicians who can be harmful to the migration system due to their general xenophobia. They are the people that as an industry we really must be concerned about.
What are your plans for your retirement? I find it hard to believe that someone like you will just sit back and enjoy the Florida sunset.
I will certainly keep my affiliation with my firm as chairman emeritus. My plan is to continue being involved in migration policy. I will be somewhat less involved with clients, but I will offer advice at the policy level and support organisations such as the IMC.