Hotel Magyar Kiraly, Székesfehérvár, Hungary Return and circular migration: recent experience in the EU Andy Fuller, Alphametrics EURES Working Party Hotel Magyar Kiraly, Székesfehérvár, Hungary 23 May 2011 Introduction to the Workshop heard political position from the Commission Now want to give a background in terms of why we are interested in mobility – concepts and EU policy and some of the challenges that we face overview of the labour market situation of the main groups of socially excluded or disadvantaged people across Europe

Objectives of analysis To examine: scale of migration flows from Central and Eastern European countries (EU12) to EU15 the extent of return migration in response to recession in EU15 countries characteristics of people concerned – particularly age, sex and education levels To consider policies implemented in both EU15 and EU12 in response to return migration – done largely through case studies of Poland, Romania, Hungary and Slovakia

Points to keep in mind Migration determined by push as well as pull factors Pull factors strong – average earnings in Latvia or Lithuania around one fifth of those in more prosperous EU15 countries. In Romania, around one seventh, Bulgaria, even lower Implication – can earn as much from working two months in EU15 as one year in EU12 But jobs need to be available and prospective gains need to outweigh costs Costs not just financial but also social– alien culture, different language, isolation from family and friends, loss of support Push factors in home country also important – shortage of jobs, poor living conditions, deprivation

Nature of migration flows Evidence that much of migration is short-term and that return migration has always been significant Evidence also that many of those that return go back to EU15 after a while – i.e. much migration is circular, people moving backwards and forwards on regular basis This particularly the case for seasonal workers in agriculture, tourism and other activities where work concentrated at particular times of year, especially Summer Circular migration most important between countries that are relatively close: from Hungary or Slovakia to Austria or Germany from Romania or Bulgaria to Greece or Italy

Gains from circular migration Circular migration potentially of mutual benefit to all involved: migrants and their families gain from having work and higher income destination country can gain from labour or skill shortages being reduced – and from work migrants might create home country can gain from income remittances – significant in Bulgaria, Romania and Latvia - but also from skills and know-how migrants bring back with them In practice, much of circular migration involves relatively basic seasonal work – agriculture, tourism But those travelling further take up higher level jobs – in UK or Ireland relative to Austria or Germany

Data issues Acute problems in identifying scale of migration, even more so for return or circular – no EU-wide data, only irregular surveys Recent Eurostat data on flows within EU and from outside - but for most countries only 2008 - and many countries not covered in any detail (Germany, France and UK) Data used for analysis come mainly from EU Labour Force Survey Advantages: data available for run of years and up-to-date cover characteristics of people – education level, work status as well as sex and age Disadvantages: can only identify net migration, not inward and outward separately data based on relatively small sample – analysis restricted to main EU15 countries where migration from EU12 important, but no data for German

Characteristics of migrants Most migrants relatively young – mostly aged 15-34, around 80% aged 15-49 Migration flows from Romania and Bulgaria predominantly to southern EU15 countries – to Italy, Greece and Spain especially Migration flows from other EU12 countries mostly to Germany and Austria before 2004 and to UK, Ireland and Sweden after entry to EU in 2004 – the 3 countries not imposing restrictions Large majority of those going to UK, Ireland and Sweden were from Poland and Baltic States - around 80%, two-thirds from Poland Even balance between men and women migrating, but not to all countries – women make up over 60% of Romanians going to Italy and majority of those going to Spain In UK, Ireland and Sweden, men in significant majority

Migration trends over past decade Big increase in migration from Central+ Eastern Europe (EU12) to EU15 Migrants from EU12 aged 15-49 living in UK doubled from 2003 to 2005 and had risen by over 3 times by 2008 – peak migration in 2006 Also increase of over 3 times in migrants from EU12 living in Ireland Much smaller increase in Sweden as well as in Austria (and Germany), where numbers already high pre EU enlargement in 2004 Romanians and Bulgarians living in Italy doubled 2005-2008 Those living in Spain increased by 3 times 2003-2007 Much smaller increase in Greece – perhaps reflecting lower income levels – and lower earnings possibilities

Education and skills levels of migrants Migrants from EU10 mainly have upper secondary education (i.e. vocational qualifications) – add to stock of skilled workers in EU15 Longer-term migrants tend to have higher education levels than shorter-term ones. More women have tertiary education than men Migrants from Romania and Bulgaria have tended to be disproportionately the lower educated, reflecting preponderance of seasonal workers But still more of them have upper secondary qualifications than those in main destination countries – Italy, Spain, Greece EU10 migrants going to Ireland tended to be higher educated than those going to UK, more with university degrees, fewer with only basic schooling – may reflect jobs they do

Effect on labour force in host country Migration has not only increased available workers with vocational qualifications Without inward migration, working-age population would have declined in 2003-2008 in 8 EU15 countries – even in Ireland Migrants from EU12 countries made significant contribution to growth of working-age population (i.e. potential work force) But in all countries except Ireland not the main source of growth – migration from outside EU more important ….

Migrant contribution to potential labour force

Effect of inward migration on employment Before EU enlargement, fear that migrants would take jobs from nationals – little sign of this In most countries, employment rates of nationals have risen as inward migration has taken place ….

Employment rates by country of birth

And some early signs of effect of recession

Effect of recession on migration Outflows of migrants from EU15 back to EU10 increased markedly in 2009 as recession hit – especially among under 25s Less sign of Romanians and Bulgarians returning from southern EU In UK, return migration to EU10 exceeded inward flows for first time – more people leaving fewer coming, deterred by lack of jobs In Ireland, migrants living in country declined by around 15% in 2009 Migration from Romania and Bulgaria seems to have continued In Italy, little sign if any easing of growth – increase of 30% in migrants living there in 2009 In Greece, number increased by around 25% In Spain, little change, though decline in those under 25 Implication – effect of recession was to increase under 25s in EU12 looking for work

Characteristics of returnees Evidence suggests return migration particularly high among those with vocational qualifications – i.e. among skilled manual workers Especially so in UK, Ireland and Sweden, though also in Spain – consistent with concentration of job losses in manufacturing and construction Evidence also that in most countries, recession hit migrants more than nationals – true of all countries apart from Sweden and UK, and especially so in Ireland and Spain …

Employment rates of national and migrants in recession

Employment rates of national and migrants in recession Possible explanation for UK + SE: Migrants without jobs left, so pushing up employment rate of those that remained

Chances of returnees finding work Those returning much less likely to be employed in 2009 than non-migrants (those who remained in country) Unemployment rates among returnees generally far higher And/or a larger number among inactive wanting to work ….

Employment status of non-migrants + returnees (resident in EU15 previous year)

Situation of Romanians in Spain and Italy Recession reduced net flow of Romanian migrants to Spain but much less so to Italy, numbers rose significantly in 2009 Recession hit migrants in particular, largely because of kinds jobs they do – construction, manufacturing, tourism Migration between Italy and Romania increasingly circular – no evidence that recession has led to increase in permanent return Adverse economic circumstances in Romania lead to many migrants who return going back to where they returned from In Spain, most migrants prefer to remain in host country where they have access to unemployment benefits if they lose their job Value of unemployment benefit higher than minimum wage in Romania

Government policies towards migrants in Spain and Italy In Spain, entitlement to unemployment benefit accompanied by access to free health care Spanish Government organised access to database on vacancies in Romania – informing migrants of job possibilities should they decide to return home But no financial inducement (unlike for those from outside EU) and measures taken in 2009 to restrict entry of family members In Italy, little Government attempt to assist migrants – access to income support limited, but also applies to non-migrants Quotas imposed on migrant workers in sensitive sectors – in manufacturing but not domestic service or healthcare Many migrants becoming self-employed and starting up businesses in response to lack of jobs – rise from 28,000 to 48,000 in Romanian-owned firms in 2010.

Situation in Poland and Slovakia In both countries, marked reduction in outflows during recession In Poland, returnees predominantly those with vocational education Migrants mostly return to places they left, largely to rural areas and small towns rather than big cities - greater chance of maintaining themselves in subsistence farming Returnees can claim unemployment benefits from countries where they worked – though admin problems in doing so In Poland, Govt. policy of attracting back migrants and providing support, especially at local level – policy targeted at professionals especially In Slovakia, number of migrants rising again despite recovery – but more to Nordic countries than UK or Ireland – higher wages + easier access to benefits.