Conference on Migration During and After the Economic Crisis

This EMN Ireland / ESRI Conference, an associated event of the Irish Presidency of the Council of the EU, was held on Friday, 14 June 2013, from 10.00 to 16.00, at the Convention Centre Dublin.

In 2007 and 2008, the world experienced one of the most severe economic downturns in modern history. In this conference, the impact of the economic crisis on migration and migration policy was explored. Attention was given to the question of how immigration policy should now be designed as the crisis eases and recovery dawns. A broad international perspective was taken by a number of contributors who addressed topics such as the changes in migration patterns that occurred because of the Great Recession. A more focussed European view was also provided by contributors as they assessed, amongst other things, whether migration helped countries to adjust to the economic contraction. Three contributors presented findings from national-oriented analysis – from Ireland, Spain and Lithuania. While Ireland and Spain had experienced large inflows immediately before the crisis, Lithuania experienced large outflows. Hence, the contrasting experiences of these three countries should yield many insights.

Programme

Please find below short summaries of three presentations at the Conference.

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“Ireland’s Recession and the Immigrant/Native Earnings Gap”

Alan Barrett, EMN Ireland, Economic and Social Research Institute

In the mid-2000s, Ireland experienced a large inflow of immigrants owing to favourable economic conditions and its decision to allow full access to its labour market to citizens of the EU’s New Member States in May 2004. This presentation begins by reviewing research on the labour market outcomes of immigrants in Ireland and the effect of immigration on the welfare state. This research relates mainly to the pre-crisis period. Beginning in 2008, Ireland experienced a sharp contraction in economic activity – between 2007 Q4 and 2011 Q1 real GNP fell by 12 per cent.

Given the changed economic climate and evidence that the recession has had a severe impact on immigrant employment in Ireland, it is interesting to ask how immigrant earnings have developed over the crisis relative to native earnings. The results  show that there has been a large increase in the raw immigrant
ative wage gap over the crisis, but that the wage gap has fallen slightly when we take account of the changing composition of the group of immigrant employees.

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“Spain: From (Massive) Immigration to (Vast) Emigration?”

Mario Izquierdo, Bank of Spain

This paper provides a first look at the data on migration flows in Spain during the Great Recession. Since the start of the Great Recession the unemployment rate in Spain has increased by almost 20 percentage points. This unemployment crisis, which is affecting all population groups, including the highly educated, is even more acute for the foreign population, whose unemployment rate is close to 40%. This situation follows a period of very high immigration flows (1995-2007) that brought the proportion of foreigners in the population living in Spain up to 11%. In this paper we document the characteristics of the recent migration inflows to Spain and compare how immigrants and Spaniards are moving abroad and across Spanish regions in response to the unemployment crisis.

Main results, still preliminary, could be indicating significant changes in the size and composition of migration inflows and outflows. In particular, emigrants (both Spaniards and recent foreign immigrants) tend to have a higher educational attainment (i.e. positively selected by education); this does not seem to be the case regarding the composition of internal migration flows.

This finding needs to be further investigated, as more data become available, but hints at the possibility of the start of a significant brain drain that, if extended too long, as the crisis persists, or if Spanish emigrates remain in their destination country, could create grave consequences for future potential growth.

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“Migration as an Adjustment Mechanism in a Crisis-Stricken Europe”

By Martin Kahanec, Central European University / IZA

In spite of the need for mobility and migration, Europe is lagging behind in terms of internal mobility and immigrant integration. Empirical evidence and hard data show that labor markets absorb immigrants well. Migrants have on aggregate no effects on wages or unemployment, positively affect GDP and employment rate, and contribute to public finances. In fact, there is no welfare abuse or tourism, rather lack of access to welfare provisions. Even if appealing during the crisis, the common belief that migrants take natives’ jobs or welfare is a myth. Rather, migrants respond to labor market skill gaps more than natives; they respond to and thus absorb economic shocks; and migration provides relief for sending labor markets struggling with labor redundancies. This is precisely what is much needed to alleviate asymmetric economic shocks affecting EU member states during the Great Recession. Labor mobility is a key, not an obstacle, to Europe’s success in coping with the Great Recession and beyond.