INDEX
Introduction
1.Ageing of the European labour market
1.1.Shortage on the European labour market
1.2.The economic role of immigration and its impact on employment
2.History and key figures
2.1.A historical overview of European migration
3.Current legislation
3.1.The European Policy
3.1.1.The development of a common European Union migration policy
3.1.2.The role of the Commission
3.1.3.Initiatives of the Commission
3.1.4.Integration
3.2.Comparing legal framework of the participating countries
4.Consequences
5.Conclusion
6.Recommendations
6.1.Flexibilise the criteria and procedures of entrance
6.2.Different canals for high skilled and low skilled employees
6.3.Recommendations for integration policies of immigrants
6.4 Country related recommendations:
6.5 Recommendations related to the initiatives of the European Union.
Bibliography
Introduction
Europe is growing grey. This is something that we can be sure of. The demographicageing will cause a shortage of workers in the whole EU.In order to minimize this future gap on the labour market, there are measures we can take now. One of these measures is to promote immigration into the European labour market.
This paper describes the situation of demographic ageing and migration in the European Union. The main attention is paid onthe flexible migration transitions from third countries into the European labour market.
In order to make an overview of the current situation, we analysed the different aspects of the migration policies in theparticipating countries of the Intensive Programme ‘IP Flexem’ project. The countries which participate are Belgium, Germany, Italy, Lithuania, the Netherlands and Spain.
At the end of this paper, we will give recommendations about how to attract immigrants from third countries to work in the EU. We will also give advice about the immigration and integration policy on European and company level.
1.Ageing of the European labour market[1]
The overall populationof EU in 2005 was 458,5 million (EU-25). Table1shows, that in 2050 this number might only be 449.8 millions. The population changes are mostly based on migration related factors, not the natural population changes.
Table 1: Population Projections
2005 / 2010 / 2015 / 2020 / 2025 / 2003 / 2035 / 2040 / 2045 / 2050EU-25 / 458.5 / 464.1 / 467.3 / 469.3 / 470.1 / 469.4 / 467.0 / 463.0 / 457.3 / 449.8
Source: Eurostat
The next decades Europe will be inevitably confronted with an ageing population. In the 25 countries of the European Union for example, according to the Eurostat baseline population projection[2], the share of the elderly aged 65 and over will increase by around 35% in twenty years and even by 80% in fifty years time.Also the potential labour force – that is, the population in the age group 15-64 years – will age.
The population ageing is a direct consequence of at firsta period with very high fertility, followed by a long time with very low numbers of births. The age structure of the population of the European Union is dominated by the large group born in the period 1946-1965 (baby boom). This group will gradually reach retiring age in the period 2005-2030 and consequently leave the labour force. Due to the fertility decline, younger groups are much smaller.The large size differences between the older and younger group will change the future age structure of the European Union potential labour force to a large extent. Although the decrease of the number of births did not happen at the same time and at the same speed in all countries, the general trend is more or less the same throughout all countries. The recently acceded countries particularly faced a rapid decrease of fertility rates after 1990, that will have its effect in due time (Van der Erf, 2001).
Figure 1: The population of the European Union by age, sex and labour status in
2005 (observed) and 2025 (projected)
1a. 2005 (observed)
1b. 2025 (projected)
Sources: Eurostat, Carone (2005)
As is shown in Figure1a and b, the elder population will grow faster than the workingage population. Thereby, ageing leads to lower employment because nearly all persons stopworking at the age of 65, most people even earlier.That means, that with a constant employmentrate (the share of people in the working age who are employed), employment in persons will declinebecause the share of people in the working age (‘potential employment’) will decline. One of the consequences of this decline working age rate is the extra pressure on the welfare state.Not only will taxes and social security contribution be collected by less people, there will also be agreater demand for health care etc…
1.1.Shortage on the European labour market
The demographic ageing will have consequences for the European labour market. A very recent article “Europe will have a shortage of 32 million employees” in the newspaper The Volkskrant[3] says, that demographic ageing will cause serious consequences on the European labour market. In this article, a short summary of the paper “Mind the gap” (by the SEO Economic Research 2007)[4] is given. The research in that papershows, that the demographic ageing will cause a shortage of 32 million workers on the labour market in the EU.
According to this paper, immigration is needed to fill up the gap.The paper says: “To get an idea of the impact of immigration: if no net migration is allowed, the overall EU-25 employment gap in 2050 will be 55 million persons rather than 32 million persons. To keep employment at the current level, the employment rate will have to reach over 88% on average. In some countries the importance of migration is even higher.”
Table 2: Effects of labour migration on employment, 2005-2050
Source: Eurostat (2004)
Table 2 discribes the scenario, in case immigration would not exist. In the first three columns, it compares the current employmentlevel with the employment level in the baseline scenario, assuming the employment rate toremain constant. In the EU-25 the baseline scenario will lead to a reduction of 32 million(-16%) employed persons. But in this scenario migration between the countrieswithin the EU-25 and between the EU-25 and other countries is expected to follow more or lessthe same pattern as it does currently.That means, in the baseline projections migration is alreadypartly incorporated as a solution; a sizeable part of the demographic effects are softened only becausenet migration is positive. Stopping net migration would therefore make future shortages muchworse, as is shown in the next two columns.The ‘no migration’ scenario shows what happens if borders would be closed for all persons notcurrently working in the country. The shortage of labour will increase dramatically, namely - 28%.The implicit number of expected labour migrants in the base scenario iscalculated in the last column of the table.
This table shows, that immigration into the European labour market is needed.
1.2.The economic role of immigration and its impact on employment
From the above, immigration is needed to minimize the effect of the demographic ageing. Many studies, carried out by the International Labour Organisation (ILO) or the International Monetary Fund (IMF), have shown that immigration has had an undeniable positive effect on employment and growth for two reasons: it increases the supply of labour and tends to have a positive influence on the demand for products. Moreover, some scholar points out that migrant working force finds a specific placement, an occupational nook, within the European labour market, without competing with national workers. In labour market, foreigners are taking a complementary function and performing categories of works on which supply of national working force is progressively decreasing. This assumption is supported by the fact that the employment of immigrants never produced a fall on wages and no damages are caused on European workforce.
2.History and key figures
2.1.A historical overview of European migration
Europe has a long history of migration. The idea to move abroad has been regarded by many generations all over Europe, because of socially acceptable life choice.
From 1945 - 1960s, migration within and towards Europe was marked by the displacements of World War II, the return migration from newly independent European colonies and inflows of workers from former overseas territories. In the mid- 1950s, a South-to-North migration classically emerged, starting with Italians and soon followed by Spanish, Portuguese, Greeks, Turks, Yugoslavs, Tunisians and Moroccans.
From the mid-1970s traditional migration examples were complicated by emerging “no job considerations”, most notably by “quality of life” factors, including environment and cost of living issues. Such non-work related motives counter the traditional rural-to-urban (intra-national) and South-to-North (inter-national) directions of geographic mobility in Western Europe. Meanwhile, cross-national flows among urban areas appeared to be on the rise, occasioned by the spread of skilled international migration, especially from the peripheral regions of Europe where the supply of highly trained persons outstrips the capacity of the local economy to absorb it. Part of this high-skilled migration is due to cross–border transfers of employees of multinational companies— sometimes advocated as a strategy to consolidate corporate cultures and internal labour markets.
According to official national statistics and Eurostat estimates, the total number of migrants living in the EU in 2004 was around 25 million, or just below 5.5% of the total population. The distribution of immigrants in the European territory the largest numbers of foreign citizens are in France, Germany, Italy, Spain and the UK.
Data for the period 2000–2004 indicates that the migrant population varied from less than 1% of the total population in Slovakia, to 39% in Luxembourg, but in the majority of countries it was between 2% and 8%.
2000-2004Slovakia / 1%
Luxembourg / 39%
Other / 2%-8%
Source: Eurostat
However, a proportion of migrants above 8% were found (by decreasing order) in Latvia, Estonia, Austria, Cyprus, Germany, Belgium and Greece and below 2% in Lithuania, Hungary and Poland.
2000-2004Latvia, Estonia, Austria, Cyprus, Germany, Belgium, Greece / 8%
Lithuania, Hungary and Poland / 2%
Source: Eurostat
In all EU Member States except Belgium, Cyprus, Ireland and Luxembourg the majority of foreign migrants are citizens of countries outside the EU-25. The number of citizens from the 10 new Member States, is comparatively small at around 0.2% of the total population of the EU-15, and with the largest proportion in Germany – around 0.6% of that country’s total population.
2000-2004EU-15 / 0.2%
Germany / 0.6%
Source: Eurostat
As well as geographic proximity, the composition of the migrant population, examined against the proportion of the five largest groups of migrants, strongly reflects their history — in particular labour migration, recent political developments and historical links.
According to the statistics of 2005, net migration in the EU-25 was +3.7 per 1000 inhabitants. Positive net migration was recorded in all Member States, except Lithuania, Latvia, Poland, the Netherlands and Estonia.
2005EU-25 / + 3.7 per 1000 inhabitants
Member States (expect Lithuania, Latvia, Poland, the Netherlands and Estonia) / POSITIVE
Source: Eurostat
Migration continuous to be the main element in the demographic growth of the EU. This is particularly due to the Mediterranean countries and some new Member States, which experienced the highest migration growth in 2005 as a percentage of their population.
As the EU has just expanded to 27 countries with different history, motivation and flows of migration, the analysis of figures is mostly based on national figures and EU-15 figures. The research of figures of EU-25 and EU-27 is limited because of the data inadequacy. Some other related information could not be found. So it is highly recommended, to improve the figures about: the migration to the labour markets, the migration to EU from the third countries, the overall amounts of immigrants residing and working in the countries and whole EU to be collected and applied. On 14 September 2005, the Commission adopted a proposal for a regulation of the European Parliament and the Council on Community statistics and international protection[5].
The tendency of increasing immigration is stronger in EU-15, than in the new EU Member States (some exceptions are based on national restrictions on migration flows). Even though new countries of the EU experience increasing emigration to the older states members, the flows of immigration from the third countries increase as well.
The motivation for migration might differ according to the country and its economical situation. The common numbers of the flows of migration and immigration do not provide the real amount of economical migration to EU from the third countries. The main motives for immigration are work and family reunification that are quest to be about 40% and 30% accordingly. As the flows of migration have increased, the work motive might be much higher.Moreover the immigrants who live and work in one of the Member States get a specific legal status. European society is built on a system of fundamental social values and rights whose implementation is the basic objective of the European policies and actions. Human and civil rights are recognized to everyone because of the fact in itself of staying in Europe. Moreover migrant workers have right to equal treatment and to the same social protection granted the host country nationals. This system of rights ensures standards of protection that are usually higher than in the countries of origin. This is a source of attraction that increases migration and a reason more to take a permanent residence in Europe.
Finally it is important to note that, although the participation to political life and public institutions could be acould be an useful way to integrate the immigrants to the rest of national citizens and invite them to have responsibilities in decisions to public affairs, foreigner residents cannot vote and access to democratic institutions.
3.Current legislation
3.1.The European Policy
3.1.1.The development of a common European Union migration policy
Originally, immigration policies were considered as following within the intergovernmental pillar. The Treaty establishing the European Community, at the article 63(3), provided that the Council was to adopt measures to develop the immigration policy regarding the conditions of entry and residence and the procedures for admission.
With the Amsterdam Treaty of 1999 (see title IV, articles 61-69), the framework has changed. Setting its objective on the establishment of an area of freedom, security, justice and incorporating this area into the Community pillar, the Treaty provides the legal basis for a common European Union immigration policy,considerably increasing the role of the European Commission.
In October 1999, the European Council agreed in Tampere (Finland) on the elements required for a common EU immigration policy. During the period of implementation of the Tampere programme (1999-2004), some main achievements already have been made:
- Family reunification[6]
Since 3 October 2003, family members of a third country national have the right to enter and residence lawfully in a MemberState, in order to preserve the family unit.
- EU long-term resident status[7]
On 23 January 2004, the EU long-term resident status for third-country nationals, who have legally been staying for 5 years in a MemberState, entered into force.
- Students[8]
For the purpose of studies, pupil exchange, unremunerated training or voluntary service, students from a third-country are able to stay, since 12 January 2005, on the territory of a MemberState for more than 3 months.
- Researchers[9]
The conditions for the admission of third-country researchers, who are staying on the territory of a MemberState for more than 3 months for the purpose of carrying out a research project under hosting agreements with research organisations, will become more flexible by 12 October 2007.
The Tampere approach was confirmed in 2004 with the adoption of The Hague Programme. This programme sets the objectives to pursue within the freedom, security and justice sector for the period 2005-2010. It also states, that legal migration will play an important role in implementing the Lisbon strategy, enhancing the knowledge-based economy in Europe and advancing economic development. The European Commission received the specific political mandate to provide a legal framework on migration policy capable of responding to the fluctuating demands for migrant labour in the labour market.
3.1.2.The role of the Commission
The Commission has made several proposals to develop EU immigration policy. The main goal is to manage migration flows better by a coordinated approach. This approach takes into account the economical and demographical situation of the EU and the existence of a demand for migrant workforce within the European labour market, especially in certain sectors of the labour market and in certain regions.
Already in 2001, the Commission has adopted a proposal for a Directive, dealing with the condition of entry for immigrant workers. It laid down common criteria and procedures of admission, providing at the same time a flexible legal framework to react quickly to the changing labour market situations. This directive has not been adopted yet. However the Commission has not stopped to stress the need of common rules and a coherent approach on economic migration. The decision to admit third country nationals in one MemberState affects the others and has an impact on the overall EU labour market. The Commission pursues its objectives by taking different kinds of initiatives.
3.1.3.Initiatives of the Commission
The Communication “Migration and development: some concrete orientations”[10]
In September 2005 the European Commission adopted the Communication “Migration and development: some concrete orientations”. This Communication includes different initiatives to improve the impact of migration on the development of countries of origin. It primarily talks about the migration from developing countries to the EU. It does not cover intra-EU migration or migration between the EU and other developed countries. Neither does it cover migration between developing countries, even though some of its initiatives may be relevant for them as well.
The Communication has looked at some practical aspects of migration and the way they can benefit the development process in countries of origin, with a primary focus on South-North migration. By this way, the Commission hopes to make the first contribution to the global debate on the links between migration and development. The policy, as presented, will contribute to enhancing the coherence of the external dimension of the EU’s immigration policy with development policy.