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The need to welcome workers

Too few migrant workers might mean economic disaster
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April 16th, 2008 issue

By Michael Romancov

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The national anthem may begin with the words” Where is my home?” but most Czechs don’t have a problem with finding their country on a map. Instead, many residents have a problem dealing with what constitutes a “neighbor” and what constitutes an “outsider.”

All Central European countries face the same problem: the notion of “us” and our homeland is very deeply rooted. It basically means that those who are white and speak correct Czech are allowed to live here.

When Prime Minister Mirek Topolánek visited Vietnam last month, reporters drew more attention to Vietnamese migrants to the Czech Republic than to opportunities for Czech investors to put their money in the dynamically developing Vietnamese economy.

Topolánek pointed to a “whole range of problems” connected to migrant workers moving here. He told Mladá fronta Dnes that “there’s a substantial fear, in some cases a certainty, that some don’t even have jobs in the Czech Republic. We’re becoming not only a target country, but also a transit country for Vietnamese migration, which is starting to cause problems with Schengen.”

He’s right in some ways. The number of new Vietnamese migrant workers to the Czech Republic has risen 37-fold in the past two years, according to the newspaper. But Czech companies seem keen to snap up the cheap, if less-qualified workers. And they plan to employ more than 45,000 Vietnamese workers by 2009, according to the newspaper.

But, without Czechs even realizing it, the Vietnamese (and others) migrant issue classifies our country as a developed one (which we like to hear). It also means we’re prosperous, because migrants usually want to move to prosperous countries. Of course, we don’t like to hear that because we tend to think we’re poor, compared with older European Union members.

Like it or not, the Czech Republic has joined virtually all of the world’s richest countries in facing a basic economic challenge: If we don’t have enough workers, we might not be able to sustain our current economic growth.

A United Nations human development study in 2000 found that the number of immigrants needed to compensate for negative demographic trends in the EU varies, depending on the objective. An estimated 79 million new people are needed through 2050, or 5 million new migrants per year, if the goal is to maintain the current size of working age population.

About 674 million people, or 14 million per year, are needed to maintain a “potential support ratio,” the study said.

Even if that number is even somewhat right, it means that all of Europe, including the Czech Republic, must change its approach to migrant workers.

A Labor and Social Affairs Ministry program started in 2003 is actually a good start.

People with university degrees from Belarus, Bosnia and Herzegovina, Croatia, Canada, India, Kazakhstan, Macedonia, Moldova, Montenegro, Russia, Serbia and Ukraine are allowed to apply for jobs here. If they are successful, they are allowed to apply for permanent residence for themselves and their family members. Almost 1,000 candidates have applied.

But that is still way too low a number to overturn the negative demographic developments at work.

Ukrainians toil at most big construction sites in Prague. Vietnamese and Chinese shopkeepers run markets and grocery stores, and they work in factories, too.

Given the labor shortage reality, and the migrants who are already here, perhaps we should ask ourselves the following question: Is the government able to handle such a gargantuan task of managing all of the new people?

Corruption tends to flourish whenever bureaucracy gets in the way, especially when demand is substantially higher than supply. When there seems to be a lack of legal opportunities, migrants often turn to mafia groups.

There’s another interesting solution to the labor shortage in the EU, although it happens to be politically controversial at the moment: There’s a population boom going on in the Middle East and North African countries, suggests Mustapha K. Nabli, the World Bank’s chief economist for those regions.

Getting educated workers from those countries to Europe would be a “win-win” situation all the way around the Mediterranean. Creating a targeted labor migration policy in the EU, and educating more potential workers in the Middle East and North Africa would help everyone.

Already, the average education level in the Middle East and North Africa rose 140 percent between 1960 and 1990. That growth rate is not matched by any other region of the world.

Workers with higher education degrees accounted for an increasing percent of the labor force in the Middle East and North Africa. At the same time, unemployment fell disproportionately for young and better-educated first-time job seekers.

At the same time, the work force is expected to shrink in the EU by a ratio of 1:3 between 2010 and 2025. Based on demographics, and because the aging population is larger than the number of workers, officials in Europe calculate that every working person will be paying taxes to take care of three pensioners.

To replace each person expected to retire in that time period, the region would need as many as 10 million additional immigrants every year.

For a variety of reasons, however, such migration has become a contentious issue in Europe, influenced by a host of social, economic and political factors.

There is also a widespread perception that such migration is economically and socially expensive for the host countries. As a result, Europe’s migration policy has been restrictive.

But illegal migrants tend to bring fewer skills than legal migrants, especially because the formality of labor markets — educational credentials, occupational licenses, etc. — makes it much more difficult for an illegal migrant to mask his or her illegal status. As a result, the migration patterns of Middle East and North African laborers in Europe do not coincide with the potential educational changes taking place in the labor force.

Given everything I’ve said, you’re probably not very optimistic.

In most countries, migrants are perceived in the best case as a problem and in the worse case as a potential threat, either in terms of culture, language, religion or national security (witness Islamic fundamentalism), or a mix of all four.

Things could change, however, if countries realize the huge demographic issues facing them in the next 40 years as the Baby Boomers get older and there are fewer children to grow up to replace them.

Using that demographic knowledge as a political wake-up call, politicians can start to change prevailing negative stances.

— The author heads the department of international relations and European studies at the Metropolitan University Prague. He specializes in political geography and geopolitics in the European Union and Russia. He sits on the editorial boards of several journals, including the Central European Journal of International and Security Studies (CEJISS).

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