FOREIGN EMPLOYEES IN MANAGERIAL POSITIONS IN KAZAKHSTAN

ИНОСТРАННЫЕ СОТРУДНИКИ НА РУКОВОДЯЩИХ ДОЛЖНОСТЯХ В КАЗАХСТАНЕ

Кенжетай Нурай Кайраткызы,

студент, факультет Бизнес школа, Университет Сулеймана Демиреля (SDU),

РК, г. Алматы

Зару Диляра Жаксылыккызы

студент, факультет Бизнес школа, Университет Сулеймана Демиреля (SDU),

РК, г. Алматы

Алимбекова Гаухар

научный руководитель, магистр бухгалтерского учета и аудита, старший, преподаватель, Университет Сулеймана Демиреля (SDU),

РК, г. Алматы

ABSTRACT

The paper investigates the effect of the trend for recruiting foreign experts on managerial posts in Kazakhstan on organizational performance, the processes within the labor force, and the local labor market’s competitiveness. The attracting foreign executives and professionals to the managerial posts of key industries’ businesses in Kazakhstan has been an existing phenomenon for several years. The paper discloses the economic implications of such recruitments analyze the processes taking place in the labor market as a response to the international professionals present at the managerial level, and present the policy recommendations made on the basis of the research. The focus will be made on supporting sustainable economic development and contributing to the skill-building process.

АННОТАЦИЯ

В статье исследуется влияние тенденции привлечения иностранных специалистов на руководящие должности в Казахстане на эффективность деятельности организаций, процессы в трудовых коллективах и конкурентоспособность местного рынка труда. Привлечение иностранных руководителей и специалистов на руководящие должности предприятий ключевых отраслей в Казахстане существует уже несколько лет. В статье раскрываются экономические последствия такого привлечения, анализируются процессы, происходящие на рынке труда в ответ на присутствие иностранных специалистов на управленческом уровне, а также представлены политические рекомендации, разработанные на основе проведенного исследования. Основное внимание уделяется поддержке устойчивого экономического развития и содействию процессу повышения квалификации.

Keywords: foreign managers, Kazakhstan Economy, Labor Market Dynamics, Skill Development, Economic Policy, Global Best Practices, Sustainable Economic Growth, Vocational Training, Knowledge Transfer, Policy Recommendations, Economic Diversification, Innovation, Corporate Social Responsibility (CSR), Sustainable Development Goals (SDGs), Foreign Direct Investment (FDI), Skill Gaps, International Expertise, Talent Management, Environmental Sustainability, Global Economic Integration.

Ключевые слова: иностранные менеджеры, экономика Казахстана, динамика рынка труда, повышение квалификации, экономическая политика, лучшие мировые практики, устойчивый экономический рост, профессиональное обучение, передача знаний, политические рекомендации, диверсификация экономики, инновации, корпоративная социальная ответственность (КСО), цели устойчивого развития (ЦУР), прямые иностранные инвестиции (ПИИ), пробелы в квалификации, международный опыт, управление талантами, экологическая устойчивость, глобальная экономическая интеграция.

INTRODUCTION

The involvement of foreign workers in managerial roles in the gradually changing economic environment of Kazakhstan has already become particularly relevant because of its enormous potential impact on the local work and skill development process and even potential repercussions on economic policy. This research aims to explore the relationship between foreign managerial skills and the strategic objectives of the country in the global economic context.

Work relevance. Kazakhstan, being a resource-rich country, needs breakthrough transformations in economic policies due to the urgent necessity of diversification and economic durability. The involvement of foreign managers is expected to trigger the spread of unique practices and increase the speed of Kazakhstan’s play on the global economic market.

Goal of the work. The main aim of this work is a critical analysis towards the influence of foreign managerial personnel on the Kazakhstan economy and labor market. This paper seeks to develop an analytical framework for recognizing the opportunities and threats implicate in the practice to promote evidence-based decision-making and future perspectives.

Novelty. The provided study stands out with a new vision and addresses some previously ignored aspects; namely, the strategic integration of foreign managers in the context of Kazakhstan. Presenting the economic analysis along with the study of the labor market traces and policy background makes a contribution to the understanding of the issue.

Research methodology. The qualitative research approach is utilized, drawing on case studies, economic reports, and labor statistics to develop an informed perspective on the topic. International Monetary Fund, World Bank , and OECD reports are used as a basis for macroeconomic analysis, and labor policies and practices as described by the U.S. Department of State are used to gain insights into the regulatory context.

Practical relevance of the work. Knowledge of how foreign managers’ abilities are influencing the country’s progress In turn, key actors are well-positioned to enhance the development or design of strategies on how to deal with the talent surplus or develop career-aligned educational curricula.

1 LITERATURE REVIEW

There are a large number of foreign workers employed in Kazakhstan, the main areas of which are construction, agriculture, mining, technology. The main countries of origin are China, Uzbekistan, Türkiye, and India, Great Britain [1]. For example, in 2021, the Board of Directors of KazMunaiGas JSC consisted of four foreign citizens out of a total of seven members [2, p. 19].

Foreign labor has a double influence on the local market and the economy’s general line. While on one side, foreign workers bring valuable experience in the fields where Kazakhstan may face a shortage of skilled workers. For example, The Ministry of Labor revealed 21 professional specialties lacking in the workforce, offering a residence permit registration option for foreigners [3]. The Minister of Labor and Social Protection of the Population also presented a new concept called "Ashyk Kazakhstan 500+". One of the goals of this concept is to attract the top 100 foreign specialists in professions that are in short supply for Kazakhstan. A "valuable skills visa" will be introduced for them, which also provides for a residence permit [4]. This move is aimed at addressing skills shortages in these critical areas, with the expectation that foreign professionals will not only fill gaps but also contribute to knowledge transfer and skill development among local workers.

However, in the immediate term, issues such as competition with local staff, and possible negative wage and employment effects on the republic’s citizens are also significant.

Kazakhstan remains determined to strengthen its global economic position, given that it has moved up to 37th place in the world’s most competitive economies in 2023 [5]. Subsequently, the country gives priority to conditions conducive to business and investment, which sometimes may include only the involvement of foreign specialists, especially in larger enterprises. As a result, the brain drain is multidimensional. At the same time, it has an impact on global competitiveness, the shortage of qualified personnel and the strategic goals of economic development that must be achieved. This is one of the indicators of the balance between short-term benefits and long-term continuity, which is facilitated by local talents.

2 ANALYSIS AND IMPLICATIONS

2.1 Analysis of economic implications

Kazakhstan's economy is currently going through a significant phase, characterized by strong policy measures and strategic modifications designed to tackle issues arising from external disturbances and an urgent need for more profound structural changes. The role of expatriates, especially those in leadership roles, is crucial in this phase, influencing both the local job market and the overall economic scenario. The International Monetary Fund (IMF) underlines the necessity of updating economic structures and policy environments to promote a growth model that is durable, inclusive, and green [6].

Further insights from World Bank data illustrate Kazakhstan's journey towards economic revival during difficult periods. The country has undertaken initiatives to weave itself more closely into the global economic fabric, engaging in international treaties and program frameworks, aiming at enhancing regulatory clarity and drawing in overseas investments [7].

These measures underscore Kazakhstan's calculated strategy to utilize the expertise of foreign managers to fortify its economic structure. This approach is coupled with a focus on enduring stability through comprehensive structural adjustments and global collaboration.

2.2 Consequences oflabor market dynamics and policy recommendations

The dynamics of Kazakhstan's labor market are intricately tied to the influx of foreign workers in managerial positions, which has both nuanced and broad impacts on local employment and skill development landscapes.

Competition vs. complementation. The delicate balance between competition and synergy is tested as foreign executives join the upper ranks of Kazakhstan's management. While these executives introduce valuable knowledge and global standards, their presence might escalate competition for domestic talent, possibly affecting wages and job prospects. The World Bank advocates for a balanced approach that ensures foreign professionals augment rather than replace the local workforce. It calls for policies aimed at seamlessly integrating foreign expertise with the enhancement of domestic talent's competitiveness [8].

Vocational training and education. Addressing skill gaps and boosting vocational education is identified as a crucial move to empower Kazakhstan's workforce to adapt to the labor market's changing demands. The OECD's Skills Strategy for Kazakhstan points to the country's efforts to refine its vocational education system, making it more aligned with labor market requirements. It suggests a heightened focus on lifelong learning and skill improvement opportunities to maintain the competitiveness and flexibility of the local workforce amidst technological progress and shifts in the global economy [9].

Economic and labor policies. For a more diversified and robust economy, Kazakhstan is encouraged to implement economic and labor policies that lessen its dependency on natural resource extraction and promote growth across various sectors. The World Bank's advice includes improving the regulatory framework to stimulate entrepreneurship, innovation, and private sector expansion. Such measures are aimed at generating new job opportunities and minimizing the economy's sensitivity to external disruptions [8].

2.3 Case studies and best practices

Successful integration of foreign managers. The successful assimilation of foreign managers into Kazakhstani companies presents instructive examples and strategies that yield mutual advantages. International corporations in Kazakhstan often set up mentorship programs and joint initiatives, fostering the transfer of knowledge and skill enhancement among local staff. This approach leads to the upskilling of the workforce and boosts organizational efficiency. An illustrative measure is the initiative by the Ministry of Labor and Social Protection of the Population of the Republic of Kazakhstan, which has proposed a government decree establishing mentoring rules for Kazakhstani workers. This entails assigning a foreign employee as a mentor to a local employee in companies that hire foreign nationals, ensuring a structured and beneficial knowledge transfer process.

International best practices. Looking globally, learning from countries that have successfully integrated skilled foreign workers can provide practical lessons for Kazakhstan. Nations such as Canada and Singapore, recognized for their comprehensive programs for skilled immigrant integration, highlight the need for policies that not only facilitate the integration of foreign talent but also invest in local education and training to bridge skill gaps gradually. These examples emphasize the importance of cultivating an environment that regards foreign expertise and local talent development as integral and complementary components of economic growth and innovation. This balanced approach serves as a model for creating a more dynamic and inclusive labor market that leverages the strengths of both domestic and international talent pools.

2.4 International influence and local development

Sustainable development through foreign expertise

The introduction of international managers into Kazakhstan has brought a significant influence on local practices and environmental conservation, thanks to their extensive global knowledge and experience in sustainable operations. These leaders play a crucial role in introducing innovative Corporate Social Responsibility (CSR) practices that focus on conserving resources, minimizing environmental impacts, and participating in local community initiatives. Specifically, in critical sectors such as mining and oil that are central to Kazakhstan's economy yet often associated with environmental issues, the adoption of sustainable methods from international managers can lead to the implementation of greener technologies in extraction and production processes. This approach supports the objectives of the United Nations' Sustainable Development Goals (SDGs), especially those focused on sustainable industry practices and climate change mitigation (Goals 12 and 13), thereby linking international management methods with improvements in environmental sustainability in Kazakhstan [10].

Enhancing social welfare through corporate initiatives

Apart from environmental benefits, international leaders frequently initiate efforts that bolster community well-being through educational outreach, improved healthcare accessibility, and enhanced employee benefits. These actions not only enrich the community's social infrastructure but also build the social value of the companies involved. International executives integrate such endeavors into the company's ethos, strengthening the relationship between corporations and their communities, and promoting a culture of social accountability and corporate citizenship. The broad positive impacts of these efforts include stronger social bonds, higher living standards, and a decrease in social disparities, aligning with Kazakhstan's goals to meet SDGs related to health and wellness (Goal 3), education quality (Goal 4), and inequality reduction (Goal 10) [10].

3 CONCLUSION

This research highlights the essential role that foreign managers play in imparting specialized knowledge, introducing international best practices, and driving economic progress on a global scale. By delving into the economic effects, the nuances of labor market dynamics, and offering policy suggestions, this study makes a substantial contribution to the comprehension of the complex impacts of this trend.

In Kazakhstan, the engagement of foreign managerial personnel has been crucial in bridging skill shortages, especially in sectors where the domestic workforce may lack certain specialized skills. By strategically granting residency permits for professions in high demand, Kazakhstan has adopted a forward-thinking approach to mitigate these shortages, enabling the transfer of knowledge and skill enhancement among its workforce. Nonetheless, the arrival of foreign executives also introduces challenges such as competition for local employees and possible influences on salary scales and job availability for the people of Kazakhstan. These observations underscore the need for a careful balance between tapping into foreign expertise for immediate gains and nurturing domestic talent for enduring prosperity.

The study concludes that the thoughtful integration of international managerial expertise is vital for diversifying Kazakhstan's economy, enhancing its competitiveness, and securing long-term development. It calls for a balanced strategy that ensures smooth integration of foreign knowledge while boosting the local workforce's competitive edge. Key recommendations include strategic talent management, economic and labor policies aimed at decreasing dependency on natural resources, and encouraging innovation and growth in the private sector.

References:

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3. QazMonitor. (2023). 21 High-Demand Jobs for Foreigners in Kazakhstan. https://qazmonitor.com/news/1461/21-high-demand-jobs-for-foreigners-in-kazakhstan
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8. World Bank. "Kazakhstan Economic Update."  https://www.worldbank.org/en/country/kazakhstan/publication/economic-update
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