Labour mobility in the EU
25 September 2014by eub2 -- last modified 25 September 2014
Approximately 8.1 million EU citizens work and live in another Member State today, representing 3.3% of the total EU labour force. Over the last ten years, two key developments have created new patterns of labour mobility within the European Union. First, the EU enlargements of 2004 and 2007 substantially strengthened the East-West mobility trend, in addition to the traditional South-North trend.
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How many mobile workers are there in the EU?
In 2013, slightly over 7 million EU citizens worked and lived in an EU country other than their own. They represented 3.3% of total employment in the EU.
Almost 78 % of the working-age EU citizens residing in another EU country were economically active and their employment rate reached 68%, 3.5 percentage points higher than the average among those residing in their country of citizenship.
Compared to the US, intra-EU mobility appears to be modest. In the US, mobility measured by the share of persons who lived a year ago in a different state, accounted for 2.7% of the population in 2011-12, while mobility within the EU relative to the population represents roughly one tenth of that level (annual cross-border mobility rate estimated around 0.2%).
What are the different types of mobility?
Mobility of workers can take several forms: permanent stay in another EU country, daily or weekly cross-border commuting or short-term stay through posting of workers.
In addition to the 7 million EU citizens that were working and residing in another EU country in 2013, around 1.1 million were living in one country but working in another (frontier or cross-border workers) and around 1.2 million each year are posted to another country.
What are the recent mobility trends?
Over the last ten years, two key developments have created new opportunities and patterns of intra-EU mobility:
- first, as a result of the latest EU enlargements, the number of EU-12 citizens residing in EU-15 Member States has increased from 1.7 to 5.6 million
- second, the recent Eurozone crisis has acted as a stimulus for intra-EU mobility.
When comparing the characteristics of recent mobile workers (2009-13) to the previous five-year period (2004-2008), it appears that:
- mobile EU workers are heading more than before towards Germany, Austria, Belgium and the Nordic countries, and less to Spain and Ireland
- overall Germany and the UK are the top two destination countries
- in terms of age, people moving within the EU remain mostly young, but the share of those aged 15-29 declined (from 48% to 41%)
- mobile EU workers are increasingly highly educated (41% having tertiary education during 2009-13 vs. 27% during 2004-08).
Has mobility increased as a result of the crisis?
While mobility in the EU decreased during 2010-2011 due to a decline in labour demand, it has started recovering in 2012-2013, although with marked differences between countries. In particular, countries hardest hit by the economic crisis have seen large increases in outflows of workers to other Member States, as well as to non-EU countries.
Compared to the pre-crisis years (2004-2008), the number of workers moving within the EU from southern countries has increased (+38%), while the flows declined from Poland (-41%) and Romania (-33%), the two top countries of origin.
Southern mobile workers have thus increased their share in the overall number of mobile workers within the EU (now 18% compared to 11% before). But most EU mobile workers (58%) still came from central and eastern Member States in 2009-2013, although down from 65% in 2004-08.
What are the advantages of mobility?
Free movement of workers brings about benefits both to the workers and employers concerned.
The right to work in another Member State can bring new job opportunities for individuals. It also offers other advantages, such as acquiring new types of working experience, and improving their skills, notably learning languages. All this enables them to take up more internationally oriented jobs. With the experience gained, they may also find a job more easily in their countries of origin later on.
Labour mobility helps address labour shortages and skills gaps. From a macro-economic point of view, it helps address unemployment disparities between EU Member States and contributes to a more efficient allocation of human resources.
In the host country, incoming workers benefit the local economy by addressing skills shortages and labour market bottlenecks. They help widen the range of services available and boost competitiveness. In the countries of origin, mobile workers alleviate the burden on public accounts (if previously unemployed) and help to revive the national economy by sending remittances.
How does the EU promote labour mobility?
EU policy aims to ensure the best possible match between the needs of jobseekers and those of employers. It does not aim at promoting labour mobility only for certain categories of workers.
The pan-European job search network EURES aims to facilitate mobility for those citizens willing to explore working opportunities abroad. EURES is based on cooperation between the European Commission and the Public Employment Services of the EU Member States (plus Norway, Iceland and Liechtenstein), together with other partner organisations. The network has about 1000 EURES advisers in daily contact with jobseekers and employers across Europe. The EURES portal gives information on living and working conditions in all participating countries in 26 languages, allowing access to more than 1.4 million job vacancies and 1.1 million CVs. The Commission has proposed to enhance EURES in order to provide more job offers, increase job matching and help employers, notably small and medium businesses, to fill job vacancies faster and better.
The European Commission also works to increase the transparency of the EU labour market and to promote better anticipation of skills needs. Tools like the European Vacancy Monitor and the EU Skill Panorama offer information on trends in occupational demand and skills requirements, allowing identifying bottlenecks and mismatches in the labour market.
In order to facilitate the exchange of information among different countries, the Commission, together with the European Centre for the Development of Vocational Training (CEDEFOP) and a team of stakeholders and external consultants, has developed a multilingual classification of European Skills, Competences, Qualifications and Occupations (ESCO), which offers a common 'language' to employers, job seekers and educators.
The Commission also promotes recognition of professional qualifications for regulated professions, such as doctors, architects, engineers, electricians, teachers and a host of other professions in various Member States. The Professional Qualifications Directive defines rules for the recognition procedures that apply to the different types of regulated professions. The revised Professional Qualifications Directive, which will enter into force in January 2016, will make it easier for professionals to move around the EU, while strengthening safeguards for consumers and patients.
What does the EU do to tackle social dumping?
Member States are responsible for enforcing labour law and rules on health and safety at work, notably through their labour inspectors, to prevent workers from other countries from being exploited by unscrupulous employers. For example, national authorities must ensure that legislation on minimum wages, working conditions, housing standards and discrimination is strictly applied. They also must prevent EU mobile workers from being employed in the unofficial economy.
At EU level, safeguards against social dumping have existed since 1996 in the form of the Posted Workers Directive, which requires Member States to ensure that posted workers enjoy the same rights and working conditions as workers in the host country. This includes minimum rates of pay, annual paid holidays or limits on working hours, as well as health and safety rules, among others.
To make it easier for Member States to apply these provisions a new Enforcement Directive was adopted by the Council of Ministers and Parliament in May, on the basis of a Commission proposal. It will help to ensure that these rules are better applied in practice, especially in sectors such as construction and road haulage, where so-called 'letter box' companies (without any real economic activity in their 'home' country) have been using false 'posting' to circumvent national rules on social security and labour conditions. It will also improve the protection of posted workers' rights by preventing fraud, especially in subcontracting chains.
The Commission has also proposed to create a European Platform to prevent and deter undeclared work, which aims at reinforcing cooperation at EU level to better tackle this phenomenon both at national level and in cross-border situations.
What does the Commission do to defend of the rights of mobile workers?
To better protect the rights of mobile workers and remove obstacles in practice, a new Directive was adopted by the European Parliament and EU's Council of Ministers in 2014, on the basis of a Commission proposal. The new Directive will help overcome existing barriers to free movement of workers, such as the lack of awareness of EU rules among public and private employers, and the difficulties faced by mobile citizens to get information and assistance in the host Member States.
The Commission, as guardian of the Treaty, is also vigilant to ensure that national laws comply with EU rules on free movement and, when necessary, pursues infringements procedures against Member States.
The potential loss of pension rights can also discourage workers from moving to work abroad. The new Directive on supplementary pension rights, adopted in 2014, will ensure that mobile workers can preserve these rights and thus not be at a disadvantage when retiring.
Do countries of origin suffer as a result of brain drain?
For the countries of origin, there may be a risk of brain drain and skill shortages in specific sectors. Therefore, it is important to create more job opportunities in the countries of origin, notably for young people. However, labour mobility is a better option for workers who would otherwise be unemployed in their home country, as they can contribute to the economy of their country of origin by sending remittances.
Furthermore, many mobile workers may not move permanently but rather for a temporary period, until there is an economic upturn in their home country. As an example, in 2012 the majority of the persons settling in Central and Eastern Member States such as Poland, Latvia, Lithuania and Romania were nationals returning from abroad (around 136,000 in Poland and around 156,000 in Romania). Returning workers bring back with them all the extra skills acquired abroad.
Finally, it is essential to tackle the phenomenon known as "over-qualification": mobile workers, in particular in the context of East-West mobility, tend to be skilled or educated beyond what is necessary for a particular job. Home countries should therefore improve working conditions and provide more assistance to job-search in order to reduce over-qualification and the resulting "brain loss".
Do mobile workers constitute a burden on host countries' social protection systems?
On the contrary. EU mobile workers represent a small share of the population receiving benefits, often lower than their share in the whole population or labour force, since they tend to be younger and more economically-active than host countries' own workforce.
In 2013, mobile EU citizens had on average an activity rate of 77.7% compared to 72% for nationals, and their employment rate was also higher (68%) than that of nationals (64.5%) and non-EU nationals (52.6%). Therefore, they are likely to pay more into host countries' budgets in taxes and social security than they receive in benefits and so be net contributors to host countries' public finances rather than a burden.
Is there evidence that mobile workers move to another Member State to seek benefits?
No. All evidence shows that the vast majority of EU mobile workers move to where jobs are available. In fact, research has shown that they do not use welfare benefits more intensively than the host country's nationals.
Furthermore, according to a study carried out in 2013 for the Commission, economically non-active EU mobile citizens account for a very small share of beneficiaries and their budgetary impact on national welfare budgets is very low. They were less than 1% of all such beneficiaries (of EU nationality) in six countries studied (Austria, Bulgaria, Estonia, Greece, Malta and Portugal) and between 1% and 5% in five other countries (Germany, Finland, France, The Netherlands and Sweden). The expenditure in healthcare for them was also a very small share of total health spending (0.2% on average).
Member States have the possibility of using safeguards resulting from EU or national legislation (as long as the latter is compatible with EU law) to prevent possible abuse to welfare systems.
Can EU financial instruments support municipalities faced with a sudden influx of mobile citizens or if migrants are poorer?
Member States can use their allocations from the European Social Fund (ESF), worth over 10 billion euros every year, to help deal with local problems related to sudden arrivals of EU mobile citizens.
Following a proposal of the Commission, at least 20% of the ESF must be spent on promoting social inclusion and combating poverty in each Member State. This includes supporting those municipalities which may be faced with sudden influx of mobile EU citizens, who may put pressure on local services, such as schools, transport, and health. Special attention is given the social inclusion of disadvantaged people, including Roma.
The Commission also helps Member States to build the capacity of local authorities to use European Structural and Investment Funds more efficiently.
Can Member States put in place safeguards to preserve the integrity of their welfare systems?
Member States can apply a series of safeguards provided by EU rules on free movement to preserve the integrity of their welfare systems. Germany, for example, has recently proposed a stricter application of the current EU law on free movement – including improved coordination between different national authorities to fight abuse, exploitation and undeclared work. The Commission welcomes the German approach to identify and solve problems within the framework of existing EU rules.
EU rules provide for the so-called "habitual residence test" which ensures that citizens who are not working may only have access to social security in another Member State once they have genuinely moved their centre of interest to that country (for example their family is there). The Commission published a guide in January 2014 to help Member States apply the "habitual residence test".
According to EU rules, EU citizens can reside in another Member State for up to three months without any condition. To stay longer, however, those who are not working (such as students or retired people) need to prove that they have sufficient financial means so as to not become a burden for the host country. Job seekers can stay up to six months or even longer if they are actively looking for employment and have a "genuine chance" to find a job. If after an individual assessment, authorities conclude that a mobile EU citizen has become an unreasonable burden, they may terminate their right of residence there.
The Commission is committed to supporting Member States. In November 2013, it presented a Communication with five actions to facilitate implementation of these rules. These actions aim, for instance, at helping Member States fight sham marriages and better apply social security coordination rules.
The Commission has set up a reflection group of Member States' representatives on the future of social security coordination. The objective is to ensure that their concerns and priorities are taken into account, and that any decisions affecting EU rules on social security coordination are taken on the basis of a proper debate amongst all Member States.
