Irregular Migration and Southern European Labour Markets Juan J. Dolado (Dept. of Economics, EUI) The Lampedusa Dilemma – Global Flows and Closed Borders. What should Europe do? EUI FORUM ON MIGRATION, CITIZENSHIP AND DEMOGRAPHY (Pull) Two Forces at Play (Push) Selection of migrants (O)= origin, ( R) =receiving Wage (O) Wage (R) (R) (O) Latam (O) & EU (R) Easter Europe (O) & US (R) Skill Skill (R) Wage (O) EU(O) & US (R) Skill Origins of Immigration in S-Med countries PULL • ↓ Fertility & ↑ Aging • ↓ Real interest rate (EZ)→ ↑ Investment in sectors abundant in Temporary work (dual labour markets) → boom in real state & services-based sectors → Demand for Less-skilled (LS) labour + PUSH Demographic Boom in LDCs (30% OECD 2010 vs. 15% en 2050) S-Med immigration magnets → → Spain: Job Bust-Baby Bust Aging (Native and immigrant (non-EU) population) Año 2001 99 Hombres Mujeres 89 79 Edades 69 59 49 39 29 19 9 30 25 20 15 10 5 0 5 Porcentaje 10 15 Pirámide de la población inmigrante Perfil de la población española Fuente: Censo de Población y Viviendas 2001 20 25 30 Immigration Boom in Spain (% total pop) Spain & Italy received 15% of migration inflows to OCDE in mid-2000s % Inmigrantes en cada país respecto al total OCDE en 2004 United States United Turkey Portugal Poland New Zealand Mexico Korea Italy Ireland Greece France Canada Australia Switzerland Sweden Spain Slovak Norway Netherlands Luxembourg Japan Hungary Germany Finland Denmark Czech Republic Belgium Austria 0.00 5.00 10.00 15.00 20.00 25.00 30.00 35.00 Immigration figures (m.) Munic. Register / Year 2000 2002 2005 2014 Total Population 40.50 41.84 43.70 46.73 Registered foreigners (EU) 0.92 1.98 3.50 5.00 (2.25) Africa Asia Latam Romania Foreigners with residence permit 0,35 0,90 1,04 0.72 0.80 1.11 2.14 4.70 Educational attaintment Distribución de los hombres de nacionalidad española y extranjera entre 25 y 44 años según nivel de formación Nacionales Extranjeros (Comunitarios:15,20% Resto:84,8%) 70 60 50 40 30 20 10 0 Analfabetos/Sin estudios Primaria Secundaria Terciaria Distribución de las mujeres de nacionalidad española y extranjera entre 25 y 44 años según nivel de formación Nacionales Extranjeros (Comunitarios:17,48% Resto:82,52%) 60 50 40 30 20 10 0 Analfabetos/Sin estudios Primaria Secundaria Terciaria Benefits for receiving countries Employers’ benefits > Workers’ costs Short-run costs vs. Medium/Long-run benefits (except for PAYG pension systems; Spanish amnesty 2005). Costs depend on migrants’skills. …. and also for country of origin (brain drain ?) Natives Employed Boom & Slumps 00 07 14Q1 15.15 17.48 15.18 (07/00) (14/07) 2.33 -2.30 Unemployed 2.36 1.39 4.85 -0.97 3.46 Lab. Force 17.51 18.87 20.03 1.36 1.16 …………………………………………………………………………………… U- rate (%) 13.13 7.36 23.90 LFP-rate (%) 53.15 56.95 57.44 …………………………………………………………………………………… Immigrants 00 07 14Q1 (07/00) (14/07) Employed 0.53 2.85 1.78 2.32 -1.07 Unemployed 0.10 0.38 1.07 0.28 0.69 Lab. Force 0.63 3.23 2.85 2.60 -0.38 ……………………………………………………………………………………. U-rate (%) 15.87 11.76 37.54 LFP-rate (%) 72.56 76.35 74.02 Policies & controls Selective policies (points, quotas) & circular migration Temporary Work Visa (TWV) ≈ visa I-688B (USA) • 3+2 years: Initial pay (non- recoverable) : € 600 • Recoverable pay (bond/deposit): € 1.500-2.000 Cost • Family unification: basic core → Fighting marginality : Incentives to human capital accumulation, higher bargaining power Labour & Education reforms → Integration What to do with “irregulars”? • Regularize (Fine: € 1.000+ TWV for 6 months …+ TWV 3+2) • Coordination Schengen borders & FRONTEX • EU harmonization on refugees News media (migration or marginality → crime ?) (2013: 3.600 in cayucos by sea vs. 300.000 inflow) Sign bilateral agreements for electoral participation. Open many more Employment Counselling Offices in countries of origin Facilitate access to Public Adm. (Army: 7%) EPITAPH In 1964 Der Spiegel devoted its headline to Portuguese citizen Armando Rodríguez, celebrating that he had become the onemillion-th. immigrant in Germany. He was awarded a Mercedes car in a ceremony presided by the Minister of Labour. Those were the times when immigrants were welcome because they were considered essential for prosperity … ... At the beginning of the 1970s, when optimism vanished, they suddenly became undesirable aliens and a threat for the welfare state Mark Mazower, 1998, NY, Knopf Dark Continent: Europe´s Twentieth Century, THANKS FOR YOUR ATTENTION!!