Europe has nothing to fear from labour mobility

Despite what some opponents might claim, labour mobility will have a long-term positive impact on Europe, writes Mikkel Barslund.

By Mikkel Barslund

07 Nov 2014

Free movement of people - a founding principle of the EU - is under attack. Some consider it to be merely a vehicle to gain access to welfare benefits. Others say that it has not been particularly helpful in rebalancing the EU during the economic crisis. Some still claim that free movement is denying countries long-term prosperity by draining their brightest minds. The staunchest opponents of free movement nod in agreement with all of these somewhat contradictory claims.

The truth is that free movement is, by and large, working well. The number of people from the periphery seeking employment in other EU countries has risen steadily. Nationals from large Mediterranean countries, such as Spain and Italy, are not leaving in droves, and are unlikely to do so in the future. In absolute terms, the numbers are small.

Labour mobility has hardly contributed to rebalancing labour markets in the EU. But this was to be expected. High youth unemployment is not a new Mediterranean predicament, and young people in these regions have never left in large numbers to find work.

"There is little evidence that the quest for welfare benefits is a major driving force"

While more people from the eastern part of the EU have moved to take up work in the west than expected by most observers at the time of enlargement, there hasn't been a huge influx of migrants. In fact, after 10 years of east-west mobility, eastern Europeans make up less than two per cent of the overall population in all but a few old member states, and they work just as much as nationals.

Some countries have seen an increase in EU citizens claiming unemployment and other social security benefits. But in most cases, this is simply a by-product of mobile citizens becoming more integrated. There is little evidence that the quest for welfare benefits is a major driving force. In fact, both with respect to the amount of people moving and economic impact, east-west mobility ought to be of little overall concern.

Relative to the size of the population, the number of people moving from southern to northern Europe has been low. Yet concerns about a potential brain drain have been voiced, with welfare states organised around substantial inter-generational transfers, it is a legitimate worry to see part of the working-age population move abroad. The issue is more pertinent for some eastern European countries, given the greater numbers of mobile people involved.

Labour mobility also carries long-term benefits for migrants' home countries. People who might otherwise have been unemployed return with skills, savings (including pension claims) and new ideas.

How the costs and benefits weigh up over the long term cannot be easily quantified, better data on mobility within the EU is needed. In any case, the prospective negative consequences of labour mobility in home countries should be dealt with via other instruments, not by restricting free movement.

Can the framework around labour mobility be improved? There is scope for enhancement in a number of existing instruments. The European job mobility portal and its online job-matching platform, cooperation among national employment agencies, the cross-border recognition of professional qualifications and support for language training can all be improved.

Thinking ahead, it is essential that foreign language education is prioritised and improved. As for the trickier issue of social security coordination, the main tenets are sound. No one moving for work within the EU should be denied social security coverage.

If the political imperative requires regulations to be changed, then under no circumstances must new mobility barriers be put in place. The facts and the economics of labour mobility do not justify tinkering with core principles without making a mockery of the notion of European citizenship.

 

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