Migration slumps in recession

Click on the image to read the book

A new international study offers further evidence of the recession’s impact on migration – some countries appear to be seeing very sharp falls in the numbers of new arrivals while the job prospects of existing migrants continue to take a hit.

 The report, from the BBC and the Washington D.C.-based Migration Policy Institute, suggests there have been big falls in the numbers of EU citizens travelling to work in other EU countries. They’re down by about two-thirds in Spain and by about 60% in Ireland, it estimates.

Indeed, says the report, some EU countries may be seeing a reversal in migration, with more people now leaving than arriving. “Anecdotal reports of young Irish men leaving for other English-speaking countries such as Australia are becoming increasingly common, evoking the possibility of a return to Ireland’s historical roots as an exporter of people,” it states. “The same is true (though to a lesser extent) of Greece, another former country of emigration that had been transformed into a country of significant immigration in the 1990s and 2000s.”  But as the report stresses, these apparent trends are still anecdotal; it will take some time before they’re verified by national and international statistics, such as the data compiled by the OECD.

 Some countries also appear to be seeing big falls in non-authorised – or “illegal” – migration. In the United States, the Pew Hispanic Centre estimates that there were two-thirds fewer non-authorised immigrants each year between 2007-2009 than in the first half of the decade.

 The BBC/MPI study also looks at the impact of the recession on migrant employment, and reports that young immigrants have been hit particularly hard. In Spain, it says, 41% of young immigrants are out of work and in Sweden 37%. As an OECD report  noted earlier this year, the recession is going to make it even harder for migrants to get a firm foothold in the workforce: “The integration period for immigrants is often long and the current downturn contributes to turning back the clock.”

 Has the recession sparked a change in governments’ attitudes to migration? There’s evidence it has. According to research by the Dallas Federal Reserve, “advanced economies from Australia and Western Europe to developing countries such as Thailand and Kazakhstan adopted policies ranging from keeping new migrants out to encouraging resident migrants to leave”. Changes have included tighter numerical limits on immigrants, providing migrants with fewer opportunities to renew work permits and round-ups of unauthorized immigrants.

One surprising finding: The recession has had only a moderate impact on remittances – the money migrants send home to their families. The World Bank estimates that officially recorded remittances worldwide fell 6% in 2009 compared with the previous year to $316 billion. But it expects them to rebound by about the same percentage in 2010 and to rise by just over 7% next year.

Useful links

OECD work on migration and on employment

 OECD Insights: International Migration

 OECD Insights: From Crisis to Recovery

How’s the economy recovering? Sloooooooowly…

Pace of recovery slowing, says OECD. Hopes for a rapid rebound in the global economy receive another blow in the latest OECD economic update. It suggests that the pace of economic recovery is slowing, and by more than had previously been expected. But although the situation is extremely uncertain, fears of a double-dip recession look to be misplaced. “The uncertainty is caused by a combination of both positive and negative factors,” OECD Chief Economist Pier Carlo Padoan  said at the launch of the Interim Assessment in Paris this morning. “But it is unlikely that we are heading into another downturn.”

Those negatives include the possibility that consumers will continue to keep a tight hold on their purse strings, so reducing demand in the economy. The reasons for that vary: some people may be paying off debts while others may put off spending because of unemployment, or the fear of losing their job, and concerns over continued weakness in house prices. On the plus side, the OECD says corporate profits are “robust” and that levels of private investment are so low they can probably now only go in one direction – up. (A decline would take even more steam from the economy.)

The OECD also believes that the worst of the turmoil on financial markets may now be over, although risks remain, and notes that emerging economies like China and India are doing well, which should benefit the wider global economy. As for the hard numbers, the OECD sees the pace of economic growth slowing over the course of this year in the G7 countries. It cites GDP growth of 3.2% in the first three months of 2010 and 2.5% in the second quarter, and forecasts falls to 1.4% in the third quarter and just 1% in the fourth.

Useful links OECD work on economics

Insights: From Crisis to Recovery

Recovery continues but looks set to slow slightly

Recovery from the recession is continuing, but looks set to slow slightly in the first half of this year, according to the latest assessment of the global economy from the OECD.

The Interim Assessment says growth “gathered steam” in the last quarter of 2009, and stood at 3.7%* in G7 economies (Canada, France, Germany, Italy, Japan, the U.K. and the U.S.). It was strongest in the United States, at 5.6%, and Japan, 3.8%, and weakest in Italy, which contracted by 1.3%.

But the assessment suggests growth will slow slightly in G7 economies in the first half of this year, to 1.9% in the first quarter and 2.3% in the second. For the three euro economies in the G7 – France, Germany and Italy – growth will be lower, with a forecast of 0.9% in the first quarter and 1.9% in the second.

Overall, the assessment notes a number of positive developments: Trade is recovering; business confidence is rebounding; unemployment may have passed its peak in the U.S., and lending conditions for banks have improved.

But there are downsides: The assessment warns that governments still need to be cautious in how soon they roll back the special measures they took during the crisis, citing “the fragility of the recovery, a frail labour market and possible headwinds coming from financial markets”.

 * The growth numbers quoted here do not include standard error ranges; these are included on page 4 of the Interim Assessment pdf.

Useful links

 OECD Interim Assessment, handout and webcast 

OECD work on economics and growth 

OECD Insights: From Crisis to Recovery