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The following OECD assessment and recommendations summarise chapter 8 of the Economic survey of the European Union published on 20 September 2007.
A mobile workforce can act as a safety valve for economies that are out of sync with their neighbours – which is especially important in the euro area – and can make companies more productive and innovative by bringing fresh perspectives and new skills and ideas. But mobility in Europe is low. Only 4% of the EU workforce has ever lived and worked in another member state. The language barrier is one explanation, but it is unlikely to be the whole story.
Annual cross-border labour mobility
Per cent of the working-age population, 2000-05
Source: US Census Bureau, Current Population Survey; Eurostat, Labour Force Statistics; Statistics Canada; OECD(2005), Employment Outlook, Chapter 2, Paris.
Most of the policy obstacles have been removed. The main exceptions are the transitional restrictions on migrants from the new member states. Around half of EU15 countries now give free access to workers from the ten countries that joined in 2004, but only two of them have fully opened their doors to workers from Bulgaria and Romania. Most of the new member states have granted free access. So far, enlargement has not led to the flood of migrants that was initially feared. While the overall level of migration has been rather modest, the inflow to some countries has been higher than expected, due mostly to their strong labour markets and the fact that they did not impose restrictions. These countries have benefited through better job matching, a reduction in structural unemployment and the easing of labour shortages. Countries that still have restrictions should reconsider their decision, but if they are retained, they should use that time to reform their employment policies as the payoff for migrants and the host country is maximised in flexible job markets. Labour mobility could also be enhanced by improving the transferability of occupational pensions. The Commission has been trying for many years to promote pension portability, and has proposed another directive on the issue. The Commission and member states should also continue to improve the recognition of qualifications, eliminate barriers in the regulated professions, reduce transaction costs on house sales and ensure that measures that provide housing for the poor are implemented in a way that does not undercut mobility.
How to obtain this publication
The Policy Brief (pdf format) can be downloaded in English. It contains the OECD assessment and recommendations.The complete edition of the Economic survey of the EU 2007 is available from:
For further information please contact the EU Desk at the OECD Economics Department at firstname.lastname@example.org. The OECD Secretariat's report was prepared by David Rae, Boris Cournède and Marte Sollie under the supervision of Peter Hoeller.