Emigration from East to West Europe: The real test for EU free movement?
January 6, 2020
Policy Briefing
Free movement of persons has brought important benefits to the European Union—promoting economic growth, allowing for better matching of labour demand and supply, enhancing individual opportunities, and nurturing a sense of community. Beneath the surface, however, a major imbalance casts some doubts over the regime’s long-term sustainability. In the years following eastern EU enlargement—in particular, the two major rounds of 2004 and 2007, which led to the accession of 12 new countries[1]—millions of citizens of new eastern Member States[2] took advantage of EU free movement and left their countries to seek better employment opportunities and higher wages in western Europe. In the four years after EU enlargement (2004-2007), for example, Poland and Slovakia lost about 2 per cent of their working-age population to other EU Member States, and Lithuania as much as 3.1 per cent.[3] Even after these countries’ economies started improving and some destination countries in the ‘old’ EU-15—such as Ireland and Italy—were confronted with economic crisis and soaring unemployment, big waves of returns failed to materialise.[4]
Emigration can bring important benefits to countries of origin, at least in the short term. It can create a valve for labour markets under pressure;[5] produce inflows of remittances;[6] allow a country to leverage diasporas abroad to strengthen international ties and represent its interests in foreign countries; and, if some emigrants return with valuable skills and experiences, they can contribute to a country’s development.[7] Over a decade of protracted emigration, , however, has resulted in considerable costs—discussed in the following section—that have put a strain on ‘sending’ EU countries: emigration from Eastern Europe has accelerated demographic decline and eroded public budgets, hampered economic growth due to labour shortages, jeopardised the provision of basic services in some communities, and disrupted family dynamics triggering a pattern of intergenerational disadvantage.
Over the years, eastern European Member States have pursued different strategies to mitigate the impact of outflows. Some have favoured ‘one-off’ approaches, developing targeted financial incentives and/or training programmes to attract some emigrants back. Others have tried to develop whole-of-government strategies—for instance improving wages or working conditions for professions at high risk of emigration or investing in better public services and quality of life—not just to encourage returns, but also to mitigate emigration in the first place. While emigration trends have softened for certain countries—such as Poland, where the stock of Polish citizens residing in another EU country decreased in 2018 for the first time in about a decade[8]—other eastern EU Member States keep struggling with sustained outflows, as demonstrated by Romanian finance minister Teodorovici’s provocative call to curb free movement, in November 2018.[9]
At a time in which anti-European sentiment has found its place in mainstream politics in several EU Member States, and with the political divide between East and West still strong on a range of subjects (from EU mobility to migration and the next EU budget), addressing the emigration challenge—and more deeply, the inequalities that underlie it—is essential to make the European Union more resilient, especially as the clouds of economic and political uncertainty gather over Europe.
[1] Ten new Member States joined the Union in 2004: eight central and eastern European countries (Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia, and Slovenia) and two Mediterranean countries (Malta and Cyprus). They were followed by Romania and Bulgaria in 2007, and Croatia in 2013.
[2] For the sake of simplicity, the terms ‘eastern’ and ‘East’ are applied indistinctly to central, eastern, and south-eastern EU Member States throughout this paper.
[3] Mihail Hazans and Kaia Philips, ‘The Post-Enlargement Migration Experience in the Baltic Labor Markets’ (discussion paper 5878, IZA Institute of Labour Economics, Bonn, July 2011), http://ftp.iza.org/dp5878.pdf.
[4] Egidijus Barcevičius, Krystyna Iglicka, Daiva Repečkaitė, and Dovilė Žvalionytė, Labour Mobility Within the EU: The Impact of Return Migration (Dublin: Eurofound, 2012), https://www.eurofound.europa.eu/publications/report/2012/labour-market-social-policies/labour-mobility-within-the-eu-the-impact-of-return-migration.
[5] For example, unemployment in Poland was at 20 per cent in 2004 at the time of EU accession, and some experts argue that EU mobility provided an opportunity for young unemployed to seek better opportunities elsewhere. Frey Lindsay, ‘Poland’s Emigration Rate Is Falling But People Are Still Worried About The “Brain Drain” Bogeyman’, Forbes, 9 August 2019, https://www.forbes.com/sites/freylindsay/2019/08/09/polands-emigration-rate-is-falling-but-people-are-still-worried-about-the-brain-drain-bogeyman/#142a300c792e. However, the view that large-scale emigration was key factor in lowering unemployment is disputed. Ewa Karwowski, ‘Halving Unemployment: Poland in the 2000s’ (presentation, Economic Research Southern Africa, Cape Town, nd), https://econrsa.org/system/files/workshops/presentations/2010/halving-unemployment-poland.pdf.
[6] Flows of remittances to EU eastern Member States were very significant until the mid-2010s, amounting to several GDP percentage points in some countries, but later decreased, possibly as a consequence of more permanent settlement in the country of destination. Cinzia Alcidi and Daniel Gros, ‘EU Mobile Workers: A Challenge to Public Finances?’ (contribution for informal ECOFIN, CEPS, Bucharest, 5-6 April 2019), https://www.ceps.eu/wp-content/uploads/2019/04/EU%20Mobile%20Workers.pdf.
[7] Jackline Wahba, ‘Return Migration and Economic Development’, in International Handbook on Migration and Economic Development, ed. Robert E.B. Lucas (Cheltenham, UK: Edward Elgar Publishing, 2014), https://www.researchgate.net/publication/309533325_Return_Migration_and_Economic_Development; Britta Klagge, Katrin Klein-Hitpaß, Agnieszka Fihel, Marta Kindler, Ewa Matejko, and
Marek Okólski, ‘High-skilled return migration and knowledge-based economic development in regional perspective. Conceptual considerations and the example of Poland’ (working paper 19/77, Centre of Migration Research, Warsaw, June 2007), https://www.researchgate.net/publication/265496549_High-skilled_return_migration_and_knowledge-based_economic_development_in_regional_perspective_Conceptual_considerations_and_the_example_of_Poland.
[8] This can be attributed primarily to rising wages and better employment prospects, as well as social policy investments. Comments by Marcin Wiatrow, Chief specialist, Department of Labour Market, Polish Ministry of Family, Labour and Social Policy, in the MPI Europe webinar Turning the Tide: Addressing the Long-Term Challenges of EU Mobility for Sending Countries, 5 December 2019, https://www.migrationpolicy.org/events/long-term-challenges-eu-mobility-sending-countries.
[9] ‘Romania Minister Suggests EU Work Permits’, BBC News, 28 November 2018, https://www.bbc.com/news/world-europe-46371207; ‘Romania Minister Calls for Curbs on EU Free Movement’, Financial Times, 28 November 2018, https://www.ft.com/content/35a31080-f322-11e8-ae55-df4bf40f9d0d.