Opening remarks by Angel Gurría, OECD Secretary-General
Brussels, 12 July, 2010
Dear Commissioners Malmström and Andor, Ladies and Gentlemen,
It is a great pleasure to launch the 2010 edition of the International Migration Outlook, one of the OECD’s flagship publications. For the first time we are releasing this publication in Brussels and I’m very pleased to be here with Commissioners Cecilia Malmström and Laszlo Andor who will share with us the European Union perspective on an important issue worldwide. Millions of persons are moving across borders every year to seek work or to join a spouse or parent. It is the human face of globalisation. If well managed, international migration has the potential to contribute to the economic and social development of all our societies.
In June 2009, the OECD organised the first-ever High-Level Policy Forum on international migration. Ministers and high-level representatives in charge of migration met to consider a Road Map to better manage labour migration. This OECD Road Map outlines ways to ensure that migration responds to the needs of the labour market and yields better outcomes for immigrants and their children, while redirecting irregular migration and illegal employment into legal channels. The recent economic crisis and the tentative recovery in the OECD area make the main principles in the Road Map ever more relevant.
The crisis has had a great impact on employment. Starting from a 28-year low of 5.8% in late 2007, the OECD unemployment rate rose to 8.7% in the first quarter of 2010. This added more than 17 million people to the unemployed ranks; many of them are youngsters and immigrants.
Clearly, the economic crisis has put a brake on migration, especially on labour migration flows. Evidence presented in the 2010 International Migration Outlook shows that across the OECD, lower demand for labour has translated into less international movement of workers. Permanent-type legal immigration of foreign nationals fell 6% in 2008 to about 4.4 million, the first decline after 5 years of sustained growth. We know that this decline continued in 2009, although final numbers are not yet available.
In Australia and Canada, employer requests for temporary workers fell by more than 50% between mid-2008 and the third quarter of 2009. Similar declines occurred in the United States where, in contrast to pre-crisis years, employers are not seeking temporary workers, be they high–skilled or low-skilled. In Europe, there is also clear evidence of less temporary labour migration, but this is dwarfed by the decline in free-movement migration, which accounted for as much as half of all migration in recent years. The number of new applicants to the UK’s Worker Registration Scheme, for example, fell 24% in 2008 and 32% in 2009. In Ireland, the comparable declines were 42% in 2008 and 60% in 2009. Switzerland and Norway both saw 30% declines in free-movement migration between 2008 and 2009.
The current slack labour market has taken some of the pressure off policy-makers to open up labour migration channels. But one should remember that some longer term trends do not reverse when there is a crisis. Some low-skilled jobs, for example in long-term care and domestic services, remain difficult to fill and the demand for highly-skilled foreign workers is still strong in many sectors, including health and education.
International students, once they complete their studies, have become a significant source of international migration flows in OECD countries. And they tend to be skilled and to speak the national language. Overall, the number of international students more than doubled between 2000 and 2007, to over 2 million; the United States and the United Kingdom, Germany, France and Australia are the main destination countries.
The crisis has not put a dent in student migration. And more and more, countries are allowing international students to stay on after graduation in order to find work. But the 2010 International Migration Outlook estimates that on average, about three quarters of those international students return to their country of origin after completion of their studies. This allays some fears of ‘brain drain’ for many origin countries.
Generally, however, migration is a boon for origin countries and they were the first to suffer from the decline in migration flows due to the crisis. Fewer workers have emigrated, remittances to support consumption and investment have declined and the pressure on origin-country labour markets has increased. There has been a 6% fall in remittances to developing countries, which translates into lower incomes and increased poverty in receiving households but also into lower economic growth in the migrant-sending countries. Less migration also means more persons unemployed in origin countries and a downward pressure on wages.
Despite lower labour migration flows, there is little evidence of sharp increases in outflows. After all, labour migration is just a part – and often only a fraction – of overall flows, which also include family and humanitarian flows, less affected by changes in the labour market. This “non-discretionary” migration remains more or less stable in most countries, and only a few countries among those hardest hit by the crisis have seen a decline in the stock of immigrants.
The crisis has not just affected flows but also those immigrants who were already abroad. The 2010 edition of the Outlook shows that immigrants tend to work in sectors which were particularly hard hit by the downturn, such as construction and the hospitality industry. In some countries, notably in the United States and Germany, the sectoral distribution of employment among immigrants entirely explains the specific impact of the crisis on migrants. In other countries, immigrants tend to have less secure contractual arrangements and less tenure in the job than natives. In the year to the third quarter of 2009, the unemployment rate of the foreign-born increased markedly in all OECD countries, with the greatest increases in Ireland and Spain, 8 and 11 percentage points, respectively. On average, in the EU-15, the increase was 3.4 percentage points, twice that for the native-born.
Despite this, it appears that the employment of immigrants has held up better than expected in some countries. This reflects the fact that some immigrant women have been drawn into the work force to compensate for the lost income of their unemployed spouses.
In addition, disproportionately more jobs have been lost among immigrant youth, in particular, men and those coming from certain areas of origin. As of 2009, the unemployment rate of the foreign-born aged 15-24 reached 15% in the United States, 20% in Canada and 24% on average in the EU.
The challenge during the recovery is to ensure that measures to help the unemployed in the labour market are inclusive. Mainstream active labour market measures must be structured so that immigrants have the same access as the native-born. Every effort must be made to reach and integrate immigrants. That makes economic sense, as labour markets will eventually recover and long-term needs for skills will reassert themselves.
One simple measure which helps immigrants in the labour market is naturalisation, something that we have looked at specifically in this year’s report. Take-up of the host-country nationality improves immigrants’ labour market outcomes through various channels, including a reduction of labour market barriers, increased mobility and reduced discrimination. Naturalisation thus appears to be an effective integration tool that should be explored more fully.
Ensuring good labour force outcomes for immigrants is not just desirable; it is a key element of a fair recovery strategy in OECD countries. It is our duty for fairness, but also for our own sake.
Ladies and Gentlemen, Thank you.