Please find ELARG contribution as presented by Yolanda on Friday.

I’ll follow your work, but was unavailable on Friday.

Best regards,

Peter

economic analysis suggest that enlargement contributed positively to dynamics of the labour in the EU, contributing to higher growth in both old and new members states, filling gaps, including in professions which suffered due to lack of skills or due to aging population

in this respect, it is important to secure free movement of labour among all MS and immediately upon accession of new members.

visa liberalisation process and full participation of candidates and potential candidates to EU programmes can have positive impact on the economies of the EU by providing expertise in selected areas. Openness to enlargement countries before accession can also fill gaps in selected sectors, as exposed during the College orientation debate.

Issue of enlargement and opening of labour markets is sensitive. However, one must be aware that countries which have most eminent EU perspective (Western Balkans and Iceland) have small and ageing populations. Commission’s analyses in opinions following their application suggested that they would not impact EU labour market. However, neighbouring countries or some sectors could be affected. In DG ELARG we believe that impact would be positive.

DG ELARG comments for the CAB in view of the orientation debate on
"The EU's demographic challenge in the post-crisis era - The quest for a productive and sustainable model of European society"

  1. The EU population is expected to rise bya mere 5 % by 2030. International migration plays a significant role in the size and structure of the population in most EU Member States. (EUROSTAT)
  2. Evidence at hand suggests that post-enlargement intra-EU mobility has not led to serious labour market disturbances.
  3. Free movement of labour is an important benefit a unified Europe offers to its citizens and enterprises, by addressing labour market shortages, without making heavy demands on welfare states. This has been confirmed by the 5th enlargement.
  4. As a result of assessments made in the framework of the accession negotiations of Croatia and of the preparation of the Opinions for Montenegro, Albania and Serbia, it is unlikely that the migration of workers from Croatia, Montenegro, Albania or Serbia after accession could become a major factor for the EU as a whole.

GENERAL EU STATISTICS

  • The EU population is expected to rise bya mere 5 % by 2030.
  • Still, there is considerable variation between the member states. The new member states Estonia, Latvia and Lithuania as well as the majority of the regions in Bulgaria, Romania,Hungary, Poland and Slovakia are expected to have a lower population in 2030.
  • The most populated areas in Slovenia and the CzechRepublic are expected to have a higher population by 2030.
  • International migration plays a significant role in the size and structure of the population in most EU Member States. The recent increase in the total population of EU Member States in recent years was mainly due to high net migration. From 2004 to 2008 the population of EU Member States increased, on average, by 1.7 million per year, solely because inflows outweighed outflows. That is, taking into account our ageing populations we need immigration in order to keep our economies running.
  • In Iceland,Poland, Romania, Bulgaria and the three Baltic States (Lithuania, LatviaEstonia), emigrants (outflows) outnumbered immigrants (inflows) according to recent data.
  • In 2008 (=most recent data), the country with the highest emigration was Iceland, where almost 29 out of 1000 residents left the country.
  • The majority of mobile workers from the new Member States of the 5th enlargement – mostly from Poland, Lithuania and Slovakia – went to Ireland and the UK, while Spain and Italy have been the main destination countries for Romanians.

IMPACT OF FIFTH ENLARGEMENT

According to a report published by the Commission in November 2008 “The impact of free movement of workers in the context of EU enlargement”[1], a Communication published in February 2009 “Five years of an enlarged EU – Economic achievements and challenges”[2] and a press release (memo) on “The end of transitional arrangements for the free movement of workers on 30 April 2011”[3],

  • Evidence at hand suggests that post-enlargement intra-EU mobility has not led to serious labour market disturbances:
  • there is little evidence that workers from the new Member States displaced local workers or driven down their wages in a serious way, even in those countries where the inflows have been greatest, although there have been some temporary adjustment problems in specific areas.
  • the average population share of nationals of the new Member States living in the EU-15 rose to 0.5% by the end of 2007.
  • According to estimates from the Friedrich Ebert Foundation, the net flows of nationals from EU-8 countries (EU-10 minusMalta and Cyprus) to EU-15 Member States could be around 200,000 per year in 2011-2013, decreasing gradually to 150,000 per year in 2015 and less than 100,000 per year in 2020. It is much lower than the level reached in the years 2006-2007 (around 350,000 per year). If those forecasts are confirmed, the total stock of nationals from EU-8 countries living in EU-15 Member States will increase from the current 2.4 million to 3.3 million in 2015 and 3.9 million in 2020 and their share in the total population from currently 0.6% to 0.8% in 2015 and a bit less than 1% in 2020.
  • Free movement of labour is an important benefit a unified Europe offers to its citizens and enterprises:
  • mobile workers from Bulgaria, Romania and the EU-8 made a significant contribution to sustained economic growth over recent years, by addressing labour market shortages, without making heavy demands on welfare states.
  • It is estimated that the recent level of intra-EU labour mobility adds about 0.3% to the GDP of the EU as a whole in the medium term. Migrants from the new Member States tend to work more in low-skilled jobs (1/3 of migrants compared with 10% of resident workers), although they have relatively high qualifications (40% of migrants fall into the high-skilled category compared with 25% of the workforce in the old Member States). Incoming workers have helped meet labour market demands and reduce bottlenecks (e.g. in the construction and services sectors), without creating major labour market disturbances.
  • Temporary migration:many EU mobile workers go to another MemberStateon a temporary basis but do not intend to stay permanently: in the UK, 50% of recent migrants have already returned to their countries of origin by 2008.
  • Young working-age population: EU mobile workers are substantially younger than the overall labour forces in the sending and receiving countries (with the majority being younger than 35).
  • Non-EU migrants still the majority:with the exception of Ireland, post-enlargement flows from the new to the old Member States have been significantly outnumbered by recent immigration of non-EU nationals (mainly Moroccans, Chinese and Indians).
  • Furthermore, in many EU-15 Member States, the inflow of citizens from other EU-15 Member States has exceeded the inflow of EU-10 citizens.

Impact on the economies of the new Member States (NMS):

  • Some professions in NMS were affected. They lost people and prices in these sector increased, therefore, affecting general population (e.g dentists, doctors).
  • Some brain drain and labour shortages was noticed in the Baltic States and Poland following accession.
  • At the same time, immigrants brought remittances back home increasing income in the NMS.
  • Moreover, many migrants returned home after the crisis, therefore, alleviating some pressure on social systems in EU-15.
  • Returning migrant bring back some skills, but if unemployment can create additional pressure on their national systems, especially if still in the crisis (Baltic states, but not Poland which grows fast).

REGARDING THE WESTERN BALKANS

  • In the past, immigrants were war refugees and not economic migrants. This had significant impact on brain drain represent a drag for economic recovery (as in some NMS in the past). Serbia was most affected.
  • Remittances are an important welfare institute in all western Balkan economies (as was the case in the NMS).
  • In the recent crisis, the Western Balkans were hit less than the EU on average, so there has been very little migration, but rather some returns home.
  • The population in the Western Balkans isin general old, with the exception of Kosovo that has the highest share of people under 25 in Europe.
  • In the context of accession negotiations with HR on chapter2 "Freedom of movement for workers", the impact study on Access of HR nationals to the EU labour market after the accession of HR to the EU showed that although it was not possible to give any precise quantitative estimate of the potential future migration flows of Croatian nationals, an impact could not be excluded at regional or local level in some Member States. However, it was unlikely that the migration of workers from HR after accession could become a major factor for the EU as a whole.
  • Similarly, we have made some preliminary calculations of the impact of free movement of labour on the EU if Montenegro and Albania join (in the framework of drafting the Opinions) and found little significance.
  • We are doing the same for Serbia and find that people have been returning back to Serbia since 2000 and that thusthe impact (if any) would be minimal.
  • The introduction of visa liberalisation for citizens of Western Balkan countries travelling to the Schengen area (which only concerned short term travels and did not give the right to work) was an important step to facilitate travelling to the EU for these persons. A large majority of travellers have abided by the rules.
  • Increases in the number of unfounded asylum applications, mainly files by persons from the former Yugoslav Republic of Macedonia and Serbia, are indications of the poor economic situation that some parts of the population, in particular Roma, still live in.

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