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How the EU has become an immigration area

Summary:
Natural change of EU28 population (the balance of live births and deaths) has fallen from high positive values in the 1960s to essentially zero recently, while the previous close-to-zero net immigration has turned positive and, since the early 1990s, become a more important source of population growth than natural increase By: Zsolt Darvas Date: December 6, 2017 Topic: European Macroeconomics & Governance The demographics of the 28 current European Union member countries have changed dramatically in the past half-century. While, in the first half of the 1960s, natural change (the balance of live births and deaths) increased population by 0.8% a year, the contribution of natural change to population growth has declined

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Natural change of EU28 population (the balance of live births and deaths) has fallen from high positive values in the 1960s to essentially zero recently, while the previous close-to-zero net immigration has turned positive and, since the early 1990s, become a more important source of population growth than natural increase

By: Date: December 6, 2017 Topic: European Macroeconomics & Governance

The demographics of the 28 current European Union member countries have changed dramatically in the past half-century. While, in the first half of the 1960s, natural change (the balance of live births and deaths) increased population by 0.8% a year, the contribution of natural change to population growth has declined steadily since then – and fell close to zero by the late 1990s (Figure 1). The increase in longevity did not compensate for the fall in fertility. Following a slight increase in the rate of natural change in the late 2000s, it started to fall again and 2015 was the first year (at least since 1960) with a natural population decline in the EU28.

Net immigration from outside the EU28 shows an opposite development. It was close to zero from the 1960s to the mid-1980s and started to increase afterwards. Since 1992, net immigration to the EU has become a more important source of population growth than the natural change. Thereby, the EU28 has become an immigration area.

To put the EU28’s net immigration numbers into perspective, Figure 2 compares it to immigration rates in other countries.

Japan is truly unique. Population is on the decline, due to a natural decline and essentially zero net immigration. As a result, Japan’s population is expected to decline from 127 million in 2016 to 102 million by 2050, and even further later on. That will certainly leave many houses empty and will necessitate major scale-back of public infrastructure, while increased longevity will dramatically increase the old-age dependency ratio (the ratio of elderly people to working age people). Clearly, Japan will need many robots, long working hours for those who are at work and extended retirement age to sustain the society, if the stance on immigration will not change.

Net immigration is positive to all other countries beyond Japan included in Figure 2. It is interesting to note that the recent rates of net immigration into the EU is similar to the rate of the United States in the 2000s. Yet Australia, Canada, Norway and Switzerland have much higher net immigration rates than the EU28.

What were the reasons for increased net immigration into the EU? Opinions differ whether it was a deliberate policy choice or somewhat accidental. Policy choices might relate to economic reasons such as attracting the brightest talents and filling labour market gaps. Political reasons, like allowing some immigration from former colonies of European powers, could also have played a role. But allowing immigration might have been somewhat accidental too, given the difficulties of protecting the EU’s southern and eastern borders and the devastating recent conflicts in the EU’s neighbourhood, which led to human flight from these conflict zones.

Whatever were the reasons, the continuously growing number of people with an immigrant background in the EU28, including the recent large wave of asylum-seeker arrivals, poses major policy challenges for the EU and its member states. In a forthcoming Blueprint that I co-author with Uuriintuya Batsaikhan and Inês Gonçalves Raposo, we analyse the EU’s immigration challenge and make recommendations on how to better manage and integrate immigrants. Stay tuned, the Blueprint will be launched at our 13 December event.

Annex: Components of population change in each EU country

While Figure 1 shows the components of population change considering the combined area of the current 28 EU members in the full period of 1960-2016, there were important differences across the member states (Figure 3). There is a natural population decline in many central and eastern and southern European countries and in Germany, while there is still significant natural population growth in – for example – Ireland, France, the Netherlands and the United Kingdom. Western and northern EU countries typically face net immigration, while there is net emigration from most central and eastern European countries.

France is the only EU country in which natural population increase was higher than net immigration in each year between 1963-2016, while Finland, the Netherlands, Poland and Slovakia shared the same development in most years, with the key exception of some recent years.

The Greek economic crisis since 2010 is painfully reflected in population statistics. The slightly positive natural population increase in 2005-10 turned to a significant natural decline in more recent years, due to both lower fertility rates and increased death rates, while pre-2010 net immigration turned to significant net emigration. The recent crisis in Cyprus and Ireland also led to massive emigration, but natural population increase hardly changed. Emigration was also very large out of Latvia and Lithuania during the crisis years.

Note that net immigration to the EU28 as a single area reported on Figure 1 considers only extra-EU net immigration, while the country specific charts show the sum of both intra-EU and extra-EU net immigration.

Zsolt Darvas

Zsolt Darvas joined Bruegel as a Visiting Fellow in September 2008 and continued his work at Bruegel as a Research Fellow from January 2009, before being appointed Senior Fellow from September 2013. He is also a Research Fellow at the Institute of Economics of the Hungarian Academy of Sciences and Associate Professor at the Corvinus University of Budapest.

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