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IP/08/1729

Brussels, 18 November 2008

Free movement of workers is good for Europe's economy

A European Commission report published today shows that mobile workers from the countries that joined the EU in 2004 and 2007 have had a positive impact on Member States' economies and have not led to serious disturbances on their labour markets. Workers from the EU-8 as well as Bulgaria and Romania have made a significant contribution to sustained economic growth, without significantly displacing local workers or driving down their wages. Both for the EU as a whole and for most individual countries, labour flows have been limited compared to the size of labour markets and to inflows from non-EU countries.

"The right to work in another country is a fundamental freedom for people in the EU. Mobile workers move to where there are jobs available and this benefits the economy," said Vladimír Špidla, Commissioner for Employment, Social Affairs and Equal Opportunities. "I call on Member States to consider whether the temporary restrictions on free movement are still needed given the evidence presented in our report today," he added. "Lifting restrictions now would not only make economic sense but would also help reduce problems such as undeclared work and bogus self-employment."

Today's report finds that mobile workers from Bulgaria, Romania and the EU-8 have made a significant contribution to sustained economic growth over recent years, by addressing labour market shortages, without making heavy demands on welfare states. At the same time, there is little evidence that workers from the new Member States have displaced local workers or driven down their wages in a serious way, even in those countries where the inflows have been greatest, although there have been some temporary adjustment problems in specific areas.

Member States' population statistics and labour force survey data show that the average population share of nationals of the countries that joined in 2004 (EU-10) living in the EU-15 rose from 0.2% in 2003 to 0.5% by the end of 2007. During the same period, the population share of Bulgarians and Romanians living in the EU-15 increased from 0.2% to 0.5%. The majority of mobile workers from the new Member States which joined in 2004 – mostly from Poland, Lithuania and Slovakia – went to Ireland and the UK, while Spain and Italy have been the main destination countries for Romanians. Yet, with the exception of Ireland, post-enlargement flows from the new to the old Member States have been significantly outnumbered by recent immigration of non-EU nationals. Evidence also suggests that many EU mobile workers go to another Member State on a temporary basis but do not intend to stay permanently.

In the wake of current economic developments it is likely that a possible decline in labour demand will reduce labour flows within the EU. Recent economic slowdowns in some countries have already led to a substantial reduction in new entries, in parallel to an increase in return migration. This is a sign that free labour mobility is self-regulatory by nature and provides a much needed flexibility in both directions: workers go to where there is demand for labour and many leave again when employment conditions become less favourable.

The report is complemented by a more detailed analysis of post-enlargement intra-EU mobility in the Commission's "Employment in Europe 2008" report (MEMO/08/719).

Background

According to Bulgaria's and Romania's Accession Treaty, the so-called first phase of the transitional arrangements, which allow Member States to temporarily restrict the free access of workers to their labour markets, will finish on 31 December 2008. Member States need to decide by then whether to lift national restrictions. These were introduced in January 2007 by 15 of the EU-25 Member States (except Finland, Sweden, Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Poland, Slovenia and Slovakia). [Neither Bulgaria nor Romania imposed reciprocal restrictions on labour flows in the opposite direction] (see MEMO/08/718 for full country details).

The so-called second phase of the transitional arrangements will end in April 2009 for the EU-8. 4 Member States (Germany, Austria, Belgium and Denmark) currently continue to restrict the access of workers from 8 of the EU10 Member States to a varying degree (see MEMO/08/718). Restrictions can be maintained after 30 April 2009 only if there is a serious disturbance (or threat thereof) to the labour market.

For more information:

Report on the impact of free movement of workers in the context of EU enlargement

http://ec.europa.eu/social/main.jsp?catId=508&langId=en

Report on the first phase of the Transitional Arrangements for the EU-8

http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2006:0048:FIN:EN:PDF

Relevant MEMOs

MEMO/06/64

MEMO/06/513

Relevant DG website

http://ec.europa.eu/social/main.jsp?catId=466&langId=en


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