Trend: EU’s attractiveness and labour needs

A trend indicates a direction of change in values and needs which is driven by forces and manifests itself already in various ways within certain groups in society

Since the second half of the twentieth century, Europe has evolved from being mainly an area of origin to a new global destination. Migration from outside the EU can be expected to continue for the foreseeable future, even though challenges of attracting and retaining workers exist. However, there are numerous possible scenarios in terms of migrants’ skills, numbers and composition on arrival to the EU.

While involuntary migration, refugee flows and family reunification are likely to feature prominently in the future, there might be new challenges in terms of the EU’s attractiveness for highly skilled workers and policies guiding labour migration. Economic recession coupled with high unemployment rates could reduce demand for additional migrant labour in Europe in some sectors for a period of time. On the other hand, the COVID-19 pandemic has revealed that migrant workers are playing a critical role performing basic functions in many EU countries, and demographic change is likely to increase the demand for skilled labour. Whatever the size of future migration, growing numbers of children that were born in the EU and have parents that are migrants will continue to increase EU societies’ diversity. Action is required to make sure that their future will not be pre-determined by their background. Net migration will remain a key issue defining the EU’s future. Citizens’ trust in institutions will be key to preventing the rise in strong anti-immigration sentiments in European societies.

This Trend is part of the Megatrend Increasing significance of migration

Manifestations

Developments happening in certain groups in society that indicate examples of change. 

With an increase in the number of foreign-born residents and their children, diversity in EU societies will grow

The number of children who are EU citizens and who reside in a different EU Member State than their birth country has increased by about 32% between 2014 and 2018. At the same time, the number of non-EU children has increased by about 17%. These statistics include both children who migrated in their lifetime and those born in an EU country but who still hold a different citizenship. These statistics make it clear that the diversity of the EU population will continue to grow substantially in years to come. It is also why the systematic underperformance of children with a migration background in the EU’s education systems requires greater attention. The disproportionately negative impact of the COVID-19-related disruptions to education on migrant and ethnic minority children is a reminder that these groups exist and should not be left behind.

Signals of change: OECD, JRC, FRA, OECD

Changing public perceptions of migration and integration

Migration to a richer European country opens the prospect of a higher income, better quality of life, career opportunities and freedoms that migrants might not have had at home. But on the receiving end, in addition to a well-needed work force, migration may also trigger concerns, public anxiety and political disputes. Eurobarometer surveys show that between 2015 and 2019, large shares of people mentioned immigration as one of the most important challenges for the EU. However, immigration figured less prominently when asked about challenges faced by their countries, or issues important to people personally. Research indicates that the loss of trust in the ability of governments to control inflows of immigrants and successfully manage integration can be a more important driver of public anxiety and negative views, than sudden inflows of immigrants.

The structural importance of migrants in helping to sustain our economic and social way of life, together with the scarcity of workers in some sectors, may have helped to consolidate positive perceptions and openness towards migration in some Member States.

Signals of change: JRC, EUROBAROMETER, Migration Policy Centre, Migration Policy Institute

Challenges in attracting and retaining essential and/or skilled migrants

The COVID-19 pandemic revealed that migrant workers are playing a critical role in performing basic functions in many EU countries. On average, 13% of workers in occupations that have been identified as essential in the response to the COVID-19 pandemic in the EU are immigrants. This includes both mobile EU workers and workers from non-EU countries. In some segments of the labour market, including health professions, personal care givers, transport, storage workers, food processing workers as well as labourers in mining and construction, up to a third of the workers are foreign-born. Occupations in these segments are mostly characterised by low wages and demanding working conditions making them unattractive for natives. At the same time, migrant workers are strongly overrepresented in sectors such as tourism and hospitality, most affected by the COVID-19 health measures and exposed to current and future economic and energy crisis.

Attractiveness and retention of talent is a challenge for migration policies. Highly-educated and highly skilled workers, entrepreneurs, investors and international higher education students are some of the groups disputed among several geographies due to their importance for research, innovation and overall economic development. According to the OECD, talent attractiveness results from several dimensions such as quality of opportunities, income and tax, future prospects, family environment, skills environment, inclusiveness and overall quality of life. The targets set for the green and digital transition could be constrained by the incapacity to attract and retain more of this precious talent. So the EU and its Member States must continue to implement policies that assure their competitive advantage to do so.

Signals of change: JRC, JRC, JRC, OECD, OECD, OECD, EMN

Migration and mobility are drivers of demographic change in Europe

In the past two decades, migration has been a major driver of demographic change in Europe. Every year since 2010, between 2 and 3 million non-EU citizens have either been given first residence permits or were registered as first asylum seekers. Throughout the past decade, the most important forms of entry were marriage and family reunion. Since 2014, asylum played an increased role, but the number of people seeking international protection in the EU has since decreased again. Labour migration played a greater role at the beginning of the decade and again towards its end. At the same time, every year, about 1 million people emigrated from EU-27 to a country outside the EU. In addition, on average 1.4 million people moved their residence from one EU Member State to another annually. This process generated labour force growth in receiving EU countries and population decline in some sending EU countries. If levels of economic divergence remain high or grow inside the EU, this imbalance could deepen in the future. When left unaddressed, it could create tensions inside the bloc.

Signals of change: EUROSTAT, EUROSTAT, JRC, JRC, EC

Fiscal benefits of migration could be increased

As the migrant population in the EU continues to grow, understanding how immigration affects public budgets is crucial. Overall, natives tend to make higher net fiscal contributions than both mobile EU citizens and migrants from outside the EU. This is because they have higher average income, higher labour-market participation and lower unemployment levels. However, due to the ageing of the native population, this relationship could reverse in the future. There have been positive developments in narrowing the difference between the employment rate of non-EU born residents and the native EU population in the past years. But in order to make full use of migrants’ economic potential, higher investment in their education, training and reskilling is needed. If that is combined with successful implementation of integration policies and increased attractiveness of the EU for skilled non-EU labour migrants, substantial gains could be made. In other words, migration alone will not solve the EU’s ageing problem, but it could increase the resources available, which could be harnessed to address it. The refugee crisis stemming from the war in Ukraine has again highlighted the fact that although refugee integration represents a significant investment in the short term, their integration in the society and labour market may bring opportunities for Member States, while on the other hand create additional challenges in the country of origin. While the linguistic proximity and the level of education were key factors in the integration of people who fled from the Ukraine, the extraordinary support given from the EU was crucial.

Signals of change: JRC, ODI, EC, JRC

Europe plays a major role in hosting and integrating asylum seekers

Between 2010 and 2021, today’s 27 EU Member States have registered 6.6 million-first time asylum applicants. After the peak years of 2015 and 2016, the numbers of first-time asylum seekers decreased and stabilised. Over the past decade, Germany registered the largest number of asylum applications, followed by France and Italy. The largest group of asylum seekers were citizens of Syria, followed by Afghans and Iraqis. In more recent years, the numbers of Venezuelans and other Latin Americans applying for asylum in the EU have been rising. The sustainability of the EU’s asylum system has been tested by the often-difficult conditions in refugee centres where people wait for their asylum applications to be processed. Major policy changes have been proposed and are still being negotiated. Finding consensus on how to address the needs of refugees at the EU level has been challenging. At the same time, there are positive reports about the growing speed of integration of refugees in the German labour market, a country that has accepted more refugees than any other Member State.

In 2022, the EU was faced with an unprecedented refugee crisis due to the war on Ukraine. The long extent of its impacts is yet to be seen, and although some Member States were significantly more under pressure than others, we have witnessed a cohesive and rapid response from the EU.

Signals of change: Centre for Global Development, Migration Policy Institute, EC, EUROSTAT

Interesting questions

What might this trend imply, what should we be aware of, what could we study in more depth? Some ideas:

• What lessons did we learn from the demonstrated importance of migrant workers to EU’s economies and societies during the COVID-19 crisis?
• Will the contribution of low and medium-to-high skilled migrants be reflected in the public perception of immigration or could the looming economic crisis increase public anxiety about migrant workers taking away their jobs and services?
• Will the EU be able to generate, attract and retain the necessary high-skilled workers needed to reach the targets of the green and digital transitions?
• Could immigration help rejuvenate areas defined by population ageing and decline?