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Labour force(d) mobility: Migration in Europe

The free movement of labour is not only a key pillar of the European project, but also essential to the proper functioning of a monetary union. I

Publishing date
26 November 2014

Last month Bruegel held an event exploring migration in the EU and the impact migration has on society and its contribution to sustainable economic growth. The free movement of labour is not only a key pillar of the European project, but also essential to the proper functioning of a monetary union. Inspired by this theme and the tone of the current political debate, we present 4 informative charts.

Net migration rate per 1000 inhabitants in Europe, 2012

Source: Bruegel based on Eurostat, most recent data, 2012.

This heat map shows the net migration rate (immigration minus emigration) expressed per 1000 inhabitants. High net immigration is represented as green in the graph, while high net emigration is represented as red.

There is a high degree of heterogeneity across EU countries, for example Germany and Belgium have net inflows of 4.3 and 6.5 migrants per 1000 inhabitants, while for Spain and Greece, the numbers are -3 and -4 (implying more people are leaving than arriving, on balance).

Unemployment and Net migration

The next two charts show the association between the unemployment rate and net migration rate.

Note: LU was excluded as an outlier in order to preserve the scale

Source: Bruegel based on Eurostat

The first chart shows simple levels whilst the second chart presents this information as changes between 2007 and 2012 (most recent data available). Countries that experienced more severe downturns due to the crisis (high rises in unemployment) have seen a larger outflow of people and lower net migration.

In general, we have seen that countries with worse economic health have seen larger net outflows of people, and that those leaving have mostly gone to the countries in better economic shape.

Main Destinations in Core Europe

Notes: We identify the main destinations in Core Europe by examining the breakdown of population by country of citizenship in 2013; Last available data for LU is 2008; GR, BG, HU, CZ, CY, HR had no available data for the UK. Benelux: BE, NL, LU.

Source: Bruegel based on Eurostat

In the last chart we present the population living in Core European nations by country of citizenship. The member-states in the right and left are the main senders, while the ones in the center are the main hosts in Core Europe.

Economic migration not only helps as a macro stabiliser, which is an essential step towards an optimal currency area, but is also beneficial on the micro level. Labour mobility helps improve potential firm-worker matching, ameliorate skills shortages, and fosters international commerce, for example, by reducing cultural barriers to trade.

About the authors

  • Thomas Walsh

    Thomas Walsh, a British citizen, worked as a Research Assistant at Bruegel in the area of macroeconomics from August 2014 to August 2015.

    He holds a Master’s degree in Economics from the Barcelona Graduate School of Economics with a thesis entitled “The Credit Channel of Monetary Policy at the Zero Lower Bound: A FAVAR Approach”.

    He also holds a Bachelor’s degree in Economics and Econometrics from the University of Bristol.

    Previously, Thomas worked at the European Central Bank as a Trainee in the Statistics Development and Coordination division, working primarily with the ECB’s SME access to finance survey, SAFE.

    He has also held positions as Research Assistant at the Social and Public Health Sciences Unit, University of Glasgow and as Intern at the Centre for Market and Public Organisation, University of Bristol.
    His research interests cover macroeconomics and finance, particularly monetary policy transmission and central bank decision making. Thomas speaks English, conversational Spanish, and basic German.

  • Diogo Machado

    Diogo Machado worked at Bruegel as a Research Assistant until August 2015 in the area of Economics of Innovation and Competition Policy. He holds an undergraduate degree in Economics from the University of Lisbon, a master from the New University of Lisbon where he specialized in Development Economics and a master from the Université Catholique de Louvain where he focused on Industrial Organization of firms’ strategies. In his master thesis Diogo used instrumental variables to estimate the effect of return migration on entrepreneurship.

    During his studies he worked as a researcher in a project at Nova Sbe exploring the effects of the arts and culture in the economy, financed by the Portuguese secretary of state for the arts. Besides, he also worked as a student research assistant at ISEG, where he studied the economic effects of beliefs and values of the Portuguese population.

    He was a classical ballet dancer and competitive debater, and besides Economics of Innovation and Competition Policy his research interests include Development Economics and the application of Randomized Control Trials in Economics.

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