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'Brain waste' costing America billions, but could this tiny loan help?
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In his native Iraq, Mohammed Al Sarag was a very skilled Air Force pilot, a wing commander who had science and engineering credentials. After he retired from the Iraqi military, he studied business and computer science and became a businessman.

Hes starting over in Utah, though. Last year, Al Sarag, now 51, resettled in the United States as a refugee with his wife, Shaimaa Saad Mohammed, and their three young children. He had worked closely with the American military forces in Iraq, and he was granted a special immigration visa.

While Al Sarag has both feet firmly on the ground, his pilots license and other credentials are worthless in America. He works full-time as a maintenance technician for Ivory Homes in American Fork, Utah, and its a job for which hes grateful, but it's not the career he envisioned.

Failure to recognize another country's education and professional credentials is a common problem across the globe, as most countries require their own training for the types of jobs educated immigrants did back home. Nowhere is the issue more keenly felt than in the United States, where immigrants who were respected surgeons and engineers in their homelands may find themselves driving cabs or cleaning schools.

The under- and unemployment that results doesn't just deliver a financial blow to an immigrant family. The D.C.-based Migration Policy Institute recently reported that nearly 2 million college-educated and skilled immigrants are unemployed or have taken low-skill jobs here, which MPI dubs brain waste. The report, Untapped Talent: The Costs of Brain Waste Among Highly Skilled Immigrants in the United States, says those immigrants do without nearly $39 billion in wages each year, compared to what theyd earn in jobs that use their skills. And federal and local governments give up close to $10 billion each year in the higher taxes those immigrants would pay if they had better jobs.

I think they face a couple of challenges, says Patrick Poulin, executive director of the Greater Salt Lake areas International Rescue Committee, which helps refugees resettle. Their degrees may not work here, so they need to be recertified, which is very expensive. And when they arrive, they really need to get into the job market to support their families. It requires them to have a longer term vision of getting into the workforce, increasing their English skills and then working on career-building challenges.

Its a global problem that begs for a local solution. And while countries and communities grapple with it in different ways, Canada has been taking an old concept microloans and using them to build bridges across credentialing gaps.

National pride, different rules

About half of immigrants to America since 2011 are college-educated and highly skilled, according to MPI. The barriers they face to full employment are not limited to having their credentials recognized, said MPIs senior research analyst, Jeanne Batalova. They also lack familiarity with how the U.S. labor market works and sometimes face prejudice by American employers regarding foreign education and work experience.

Employers are biased against foreign degrees and dont believe immigrants have the skills to communicate, said Batalova, who co-wrote the report and is also the author of the book Skilled Immigrant and Native Workers in the United States.

She explained the employment challenges are a big surprise to immigrants, who don't realize the challenges they'll face to use their skills in a new land. Many immigrants come here to reunite with family members and that's where they turn for help understanding how to find jobs in America.

"They lack professional networks and a conduit that could connect immigrants to jobs," Batalova said. "Their families know only what they know. If they're not plugged into the engineering field, they don't know where (the immigrant who was an engineer) should start."

That cousin who owns a mom-and-pop grocery store and has an opening can help in that way, but it's a far cry from knowing what a new immigrant would need to do to gain local professional certification, she said.

The education-job mismatch in America is not unique to immigrants 18 percent (7 million) of American college grads are underemployed in terms of their skills, too although it does play out on a grander scale among immigrants.

MPI says immigration status and brain waste are linked: Of immigrants who were educated here and became American citizens, nearly 1 in 5 have trouble finding jobs that match their higher skills, compared with nearly 1 in 4 green-card holders and more than 1 in 3 immigrants who lack a legal status.

Canada is better than most countries at easing the transition of skills from one nation to another, although it, too, insists on ensuring credentials meet the standards it sets.

More than two-thirds of Canada's immigrants are allowed into that country because they possess certain skills, part of a skills-based admission system pioneered decades ago. Because the skills and training immigrants bring matter to the Canadian government, Americas neighbor to the north has more thoroughly tackled credential assessment and created a sophisticated system to recognize foreign degrees, Batalova said.

In Canada, its more streamlined and harmonized across the entire country, which helps everyone, she adds, noting that a system designed to help immigrants also helped natives.

But theres still a Catch-22 that can snag immigrants: Employers typically also want immigrants they hire to already have Canadian job experience. Language skills are sometimes tough, she adds. For a doctor, its not enough to have a degree in medicine. You have to be able to communicate with the patient.

Canadas helping hand

Canadian tackles one of the most basic barriers to working at ones skill level through a microloan program that helps cover the cost of licensing, which is sometimes a multistep process that can be expensive for those who lack the credentials for a well-paying job that could cover that cost. Tunde Jegede, 53, of Fort McMurray, Alberta, Canada, has benefited from one of Canadas microloans for immigrants.

In his native Nigeria, he worked for Cadbury Nigeria, a subsidiary of Kraft Foods, Inc. He started as an engineer and ended up a procurement category specialist in packaging. He had a certification as a supply chain management professional and hoped when he emigrated to Canada that he would land a comparable job, in both pay and use of his skills.

Within three weeks of settling in Canada, he had job prospects that were indeed right in line with his skills and training, working for a municipal government (In America, that would be like a county government job.) He did well in the interview, he was told, but he lacked a Canada-issued certification.

It took him three years of coursework to earn the certification he needed and it would have taken much, much longer were it not for the microloan that he will pay back over three years.

It was a big relief for me, says Jegede, who was so happy to pass the classes that he invited someone from the microloan company to come to his (graduation) ceremony, "because the loan made it possible.

He earned a Canadian Supply Chain Management Professional certification last June. He got a supply chain job in December.

How it works

The microloan program was founded in Calgary by the late Maria Eriksen in 2005 to help women, says Claudia Hepburn, CEO of Immigrant Access Fund Canada, based in Toronto. The first year, 35 women got loans. The program has grown to serve skilled immigrants and refugees across Canada; last fiscal year, they made small loans to 486 skilled immigrants and refugees.

We do consider the program a huge success, Hepburn said by email. Our loan recipients who are unable to get loans at reasonable rates from traditional lenders repay us at a rate of 97.5 percent.

She said the loan recipients' incomes triple on average when they earn credentials, so they dont need to receive government aid and they instead contribute to the economy with both skills and taxes. With Canada accepting over 150,000 skilled immigrants a year, we are just scratching the surface of our potential.

The average microloan is $7,000; the maximum is $10,000. Some loans are just a couple thousand dollars. Most of the money comes from government sources, but they have private funders, too, including individuals, foundations and corporations, Hepburn says.

She was hired two months ago and given the charge to grow the organization so that we have 10 times the human capital impact.

Most of their loans go to immigrants in the health care field, including doctors, nurses, pharmacists and dentists. Engineers make up the second biggest group, followed by accounting and finance professionals. Between them, they account for 90 percent of the loans, she notes.

Poulin says the IRC in Utah has its own microloan program, although it hasn't used them to cover credentialing costs. Its microloan focus has been on helping refugees start small businesses. To that end, theyve funded a couple of food trucks and jump-started a mechanic shop. A couple of Uber drivers have vehicles courtesy of local IRC microloans.

Poulin says microloans for licensing could be considered in the future, although right now we are going toward more career-mentorship type programs, so that once someones employed, we do not just leave you alone. We want to try to build that career.

MPI's Batalova said different locales are trying to help refugees and immigrants in different ways, including creating mentorships like Poulin describes and helping with interview skills and whats proper in the American workplace. One woman, a financial administrator from Angola, in a mock interview answered the questions what to do if work got stressful by noting shed leave and take a nap. Thats a good answer in Angola, but not so much in America, Batalova says.

Programs like Welcome Dayton and Welcome Detroit help immigrants work on language skills and connect to community resources and mentors.

What's at stake in all these efforts is big in terms of sustaining economic stability for communities.

When skilled workers leave, so will employers. As we learn about the costs associated with brain waste, we realize we lose a lot in both learning and in taxes, Batalova says.

At zero, but moving forward

Poulin's organization could establish managed microloans so that immigrants with good credentials and skills could certify here, if funding was available. The microloan money the group now has, which provides some seed money for entrepreneurs to start their own businesses, comes from a source that restricts use to refugees.

He said the refugees and immigrants most likely to have those high skill levels and need certification help most are those from Iraq, like Al Sarag, or from Syria and Bhutan. They are a small portion of the overall population the agency serves. IRC would need funding that's not targeted solely for refugees in order to do that effectively hopefully in partnership with some of the folks who provide the credentialing.

Meantime, Al Sarag, like all immigrants and refugees, must first focus on making money to support his family, even if it means starting from zero. A self-described hard worker who speaks Arabic, English, and some Turkish and French, he contemplates returning to school in America, but says it will have to wait until he can afford it.

He's a practical man who notes few regrets, although he misses owning a home instead of renting an apartment. He also misses being able to buy his kids the things they want without having to count every penny and worry about it.

Al Sarag's helping his wife learn English, but because she is home with their baby she has less opportunity to practice than he or the kids. Hes in the workforce and they go to school, where they are fast learners. His English is accented, but near-perfect.

He certainly misses flying, too, but the best he can hope for there is to one day pilot a small plane. His role in the Iraqi Air Force means he'll never be a commercial pilot in America, he says.

But even though hes taking it slow and cannot afford college to beef up his credentials right now, he is trying to improve and learn new things. He's working on his work-related education.

Ive asked to do more certifications. I am getting a course for a swimming pool. And another to work with gas appliances," he said. "I want to add to my education to improve myself.

That's just the beginning, he says. He's a man with lots of energy and big hopes, who loves his family. That, he figures, will help him figure things out.