In focus : an update on labor migration from Poland

46691 EU10 October 2008 In Focus: An Update on Labor Migration from Poland Following a large wave of post-accession labor migration, in particular from Poland and the Baltic countries to the EU15, labor outflows seem to be weakening recently. This weakening, and in some cases reversal, reflects the increases in wages of countries where the migrants originated, which is making the incomes they earn in the EU15 less attractive. At the same time, the main destination countries are undergoing an economic slowdown, which is weakening demand for migrant workers. These forces work together to help slow migration and perhaps reverse flows in the near term, at least for some categories of workers. But a return to the regular labor market from a temporary, below-potential, lower-skill job abroad may not necessarily be easy. It is unclear how fit these migrants are to reintegrate into labor markets back home. Some of these workers, moreover, have suggested that they may go abroad again. We may be witnessing the formation of a highly mobile segment of the labor market. Following the post-enlargement opening of selected EU15 labor markets, labor outflows from Poland and the Baltic countries intensified. Workers headed largely to Ireland and the U.K., which, together with Sweden, opened labor markets for the EU8 workers immediately after accession. These flows Table 3. Temporary Migration from Poland, 2004- (also reflecting the legalization of already 2007 (in thousands, end-of year stock)* existing employment) may be temporary in nature and primarily supporting local labor 2004 2005 2006 2007 markets during economic upturns.1 Even though Total 1,000 1,450 1,950 2,270 absorbed with little negative impact in the of which: receiving countries, labor migration has had EU 750 1,170 1,550 1,860 Austria 15 25 34 39 substantial impact on the sending economies, Belgium 13 21 28 31 pushing up wages and adding to skill shortages. Cyprus . . . 4 Czech Republic . . . 8 Relatively, the most significant outflow was Denmark . . . 17 observed in Poland and the Baltic countries.2 Finland 0 1 3 4 France 30 44 49 55 According to estimates from the Polish Germany 385 430 450 490 government, the number of Polish nationals Greece 13 17 20 20 Ireland 15 76 120 200 staying temporarily in the EU more than doubled Italy 59 70 85 87 during 2004-2007 to 1.9 million. Polish nationals Portugal 1 1 1 1 Spain 26 37 44 80 are now the fourth largest national group in the Sweden 11 17 25 27 UK, up from 13th place before accession.3 The Netherlands 23 43 55 98 U.K. 150 340 580 690 Migration flows to the U.K and Ireland appear Non-EU 20 30 60 65 to have started to weaken (Figure 35 - Figure Norway . . . 36 36).4 These figures are confirmed by data on the * Number of persons staying temporarily abroad: for years 2002-2006 Polish side.5 More in-depth research, comparing more than 2 months, for 2007 more than 3 months. According to the number of new registrations in the U.K. and statistical office the change of methodology result in only marginal changes to LFS-estimated stock of EU8 nationals differences and data can be compared between the periods. suggest that as much as one-half of the post- Source: GUS. accession migrants may have already left the U.K., with the pace of return accelerating during 2007 and 2008.6 1For a more detailed analysis see World Bank Quarterly Economic Report, Labor Migration from the New EU Member States. September 2006. 2Kaczmarczyk, P., Ok