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Increasing Labour Supply through Economic Migration
The Peer Review was held on 23rd and 24th June 2005 in Dublin, Ireland, hosted by the Department of Enterprise, Trade and Employment. In addition to the host country, a further twelve countries participated in the discussions as follows: Austria, Bulgaria, Cyprus, Finland, Hungary, Malta, the Netherlands, Norway, Portugal, Slovenia, Sweden and Turkey.
Increasing labour supply through economic migration
Ireland is a country of particular interest from a migration perspective, having moved from being a country of net emigration to being a country with one of the highest current rates of net immigration in the EU25. The current Irish migration policy focuses on helping meet the labour and skill needs for the growing economy through a system of work permits and working visa/work authorisation systems. The country has experienced relatively high economic growth since the mid 1990s and this has encouraged a corresponding increase in the number of economic migrants both from inside and outside the European Economic Area (EEA). Furthermore, no restrictions were applied to residents of the ten new Member States on accession in May 2004 and some 50,000 have entered Ireland for work since then.
The basic approach is that employers in Ireland are required to try and fill any vacancies they have with applicants from the EEA before offering jobs to those from outside – vacancies have to be advertised in the public employment service for a minimum of four weeks prior to offering a post to an applicant from outside the EEA. Such applicants must have a work permit, which are specific to one employer, one employee and one post and it is the employer who has responsibility for the application and its subsequent management.
On the face of it, the Irish approach has had some success. Immigration has played an important part in enabling Ireland to increase its labour supply and meet the needs of economic growth. Returning Irish nationals have been a significant part of total migration, but migration in total has accounted for one third of the increase in labour supply over the past five years. A key feature of the immigrant population is their relatively high levels of educational attainment, with some evidence of an occupational gap (well-qualified immigrants remaining in occupations at a lower level than their qualifications justify), particularly for those on work permits that may reduce their mobility in the labour market.
New legislation, the Employment Permits Bill, is scheduled to be published in 2005 and this is intended to provide a firmer legislative basis for the current administratively-driven system, allowing more accountability, certainty and transparency.
Aspects of Transferability
The migration experience of the peer countries was mixed, with some sharing similar issues to Ireland, while others (particularly new member states and accession states) had different perspectives. In several of the latter the dominant pattern has been one of emigration rather than immigration, although for some of these this pattern was shifting, with increased immigration levels, and for most countries there was some form of regulation on immigration and work permits featured strongly in this.
Generally the Irish policy was seen as appropriate in a situation of economic growth, though there were concerns over the employer-focused work permit system that might reduce individual freedom and flexibility in the labour market. However, it was felt that consideration needs to be given to what happens to the position of the migrants when there is an economic downturn, though some of this negative effect on labour demand may be counteracted by the labour supply constraints arising from demographic change. More generally, some participants from countries with longer experience of significant net immigration raised some questions about the longer-term sustainability of the Irish approach. Some possible improvements were also suggested to the Irish approach, eg the possibility of allowing individuals rather than firms to hold work permits to encourage the mobility of migrants within the Irish labour market and tackle the ‘occupational gap’. Some concerns were also raised regarding the extent to which migrants are being effectively integrated into the Irish labour market and society.
Summary
Irish Government Paper
Discussion Paper - Alan Barrett
Statements and Comments
Participating independent experts
| Austria |
Karin MAYR
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Johannes Kepler University of Linz
www.economics.uni-linz.ac.at
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Bulgaria
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Georgi ANGELOV
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Institute of Market Economic
www.ime.bg/en/index.html
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| Cyprus |
Nicos TRIMIKLINIOTIS |
Cyprus Labour Institute
www.inek.org.cy/english
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| Finland |
Sari PEKKALA |
Gouvernment Institute for Economic Research
www.vatt.fi/english/index.htm
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| Hungary |
Endre SIK |
TÁRKI Research Institute
www.tarki.hu/index-e.html |
| Malta |
Marisa XUEREB |
University of Malta
www.um.edu.mt/start.html |
| Netherlands |
Jeroen DOOMERNIK |
University of Amsterdam
www2.fmg.uva.nl/imes/news.htm |
| Norway |
Grete BROCHMANN |
Institute for Social Research
www.samfunnsforskning.no/page/Front_page/Menu_english/7975/1752.html |
| Portugal |
Helena MIRANDA |
Technical University of Lisbon
pascal.iseg.utl.pt/~socius/english/Homepage.htm |
| Slovenia |
Simona ZAVRATNIK ZIMIC |
University of Primoska, Science and Research Centre of Koper
www.zrs-kp.si/indexe.htm |
| Sweden |
Donald STORRIE |
Centre of European Labour Market Studies
cent.hgus.gu.se/econ/celms |
| Turkey |
Murat KIRDAR |
Middle East Technical University
www.econ.metu.edu.tr |
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