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FEATURE STORY May 31, 2019

Migration in Europe and Central Asia – Creating Opportunities for People

Migration has long been vital to the social and economic history of Europe and Central Asia. For centuries, migration has helped vulnerable households in the region escape poverty while, more recently, economies have benefited from cross-border labor mobility.

Emigration is a way for people to escape economic hardship, and immigration helps to fuel economic growth. During the past few decades, workers across Europe and Central Asia have capitalized on employment opportunities across borders, which have arisen from regional economic integration.

In the coming years, migration patterns in the region are likely to change, alongside technological advancement and further cross-border connectivity. Competition for high-quality jobs will become more intense, while the share of high-skilled migrants may increase.

Differences in income and unemployment rates, as well as demand for skilled labor from the region’s largest economies, will remain key drivers of migration—and deep regional economic integration will intensify migration flows. Migration will therefore continue to play an important role in the economic and social development of the region.

“The benefits of migration tend to be long-term and diffused, while the costs tend to be much more concentrated and short-term,” said Asli Demirgüç-Kunt, World Bank Chief Economist for Europe and Central Asia, at a recent workshop on migration. “That’s why we need to design policies that maximize the overall gains from migration, while distributing these gains more widely to compensate the adjustment costs of adversely affected people.”

While some migrants leave their country to escape conflict, most are driven by the desire to seek better opportunities and improve the quality of their life.

“Migration is the number one social and economic issue for Europe and Central Asia,” said Sergei Guriev, Chief Economist for the European Bank for Reconstruction and Development. Referencing the EBRD’s Transition Report 2018-19: Work in Transition, Guriev added, “It is not possible to combat the economic forces that drive migration, but improving the business environment and public services in source countries can significantly reduce people’s willingness to emigrate.”

Evidence shows that migrants bring long-term economic benefits to their new countries. Host country  workers often benefit from the skills that immigrants bring, while other citizens consume products and services provided by immigrants. Young immigrants who complete a high-school or college degree in their adopted country tend to perform just as well, over time, as host country-born citizens.

Integration of migrants into society is key to maximizing the gains from international migration for both origin and host countries. “Immigrant integration and assimilation are important in realizing these gains,” said Çağlar Özden, World Bank lead economist and co-author of Moving For Prosperity: Global Migration and Labor Markets.

Technological advancement and the global integration of product and labor markets are changing the nature of migration across Europe and Central Asia. Technology is creating increasing demand for high-skilled workers, especially those in technology-related fields – who are more likely to migrate. In general, technological advancement is complementary to movements of skilled workers.

In an increasingly globalized and interconnected world, social and economic policies need to help migrants and non-migrants alike cope with increased flexibility in labor markets. Such policies must also be an integral part of a growth agenda that seizes the opportunities of new technologies.

Migration is one of the most important networks in the global economy: migrants not only transfer knowledge between the host and home countries, they also facilitate the transmission of knowledge through other connections such as trade and foreign direct investment.

Policies that are supportive toward migration can therefore make a critical contribution to boosting prosperity in countries across Europe and Central Asia, and help create better opportunities for people.


Related Material

Event: Migration in Europe and Central Asia

Presentation by Sergei Guriev (PDF)

Presentation by Caglar Ozden (PDF)