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Labour mobility has strong economic benefits as more people being ready to work in another EU state. It allows for a more efficient allocation of human resources, provides more job opportunities for citizens and gives employers a broader choice in their search for talent. It helps to address skills and labour shortages in some countries, and high unemployment in others.

Presently, one in five young European under the age of 25 cannot find a job, yet there are still about 2 million unfilled vacancies across the EU-28. During the crisis years, labour mobility has helped to absorb asymmetric economic shocks. This has enabled Europe, and in particular the Economic and Monetary Union, to stabilise and get back on a growth path.

Students are among the most mobile citizens in EU; free movement of people (the possibility for students, workers or pensioners to move to another member state) is a cornerstone of the EU’s integration.

Marianne Thyssen, Commissioner for employment, social affairs and labour mobility said at a conference in Maynooth University of Ireland, Dublin (13 November 2015) that labour mobility has been one of the rights that European citizens cherish most. However, she added, free movement was not only important as an individual right of each citizen, it was also in the collective interest as Europeans that people are mobile and ready to cross borders.

Labour mobility also promotes knowledge transfer, innovation and human capital development, which is essential in a context of quick technological change and global competition. It creates interaction between EU citizens, and – if the conditions are right – it can improve mutual understanding and contribute to making European societies more tolerant and inclusive.

Commission will continue promoting labour mobility and to work with the member states on the removal of existing obstacles.

Problems in labour mobility

The problems abound, said Marianne Thyssen, Commissioner for employment. She mentioned the following factors: mobile citizens can be vulnerable to abuse and exploitation when they try to integrate in a labour market that they are less familiar with. They may find it more difficult to enforce their rights abroad than at home. Then, families may be separated as result of labour mobility, or face difficulties integrating in their new home countries.

At macro-economic level, the EU states may be exposed to brain drain and rapid ageing of their population when too many young people leave the country at the same time and for too long.

In some EU states, people are concerned that high numbers of incoming workers and jobseekers risk weighing heavily on their well-developed and precious social security systems.

In some EU states, such as Sweden, the Netherlands or France, people are concerned that high numbers of posted workers might exercise a downward pressure on wage conditions in some sectors, e.g. construction.

Labour mobility’s statistics

Promoting labour mobility can have many positive effects, whilst at the same time minimising its downsides. The EU implements the task by a factual analysis of the mobility flows: thus nowadays about 8.3 million EU citizens live and work or look for work in another member state (that is only 3.4% of the total EU labour force). Close to half of them have been living abroad for 10 years or more. For the most part, mobile workers are young and highly-educated; the proportion of women amongst them is increasing.

In addition to the 8.3 million people living and working abroad, there are 1.6 million frontier workers across Europe. Frontier workers live in one country and work in another country – they go home at least once a week, e.g. many frontier workers in the UK and Ireland, active are Danes-Swedish workers, etc.

Finally, there are 1.45 million posted workers in Europe; these workers live and are employed in one country, but their employer sends them temporarily to another country to provide a service there.

For example, posting is less common in Ireland: there are about 5.500 workers posted to Ireland a year and about 3.500 workers posted from Ireland. The EU member states receiving most posted workers in the EU are Germany, France and Belgium. Those sending out most posted workers are Germany, France and Poland.

Looking at total population figures, Luxembourg has the largest proportion of EU citizens (39%) amongst its inhabitants; in Ireland - 8.1%; in the UK - 4.1% and in Germany - 3.8%.

All in all, the number of mobile EU citizens and their proportion in the member states is quite low. EU mobile citizens moreover have a significantly higher activity rate than nationals (78.3% versus 72.3%). But they also have a slightly higher unemployment rate (11.7% versus 9.9%). This is likely to be linked to the fact that mobile EU workers, and immigrants in general, tend to be more vulnerable to business-cycle fluctuations than natives, argued Marianne Thyssen, Commissioner for employment.

Labour mobility figures: example for Ireland

Ireland provides an excellent example of how labour mobility, combined with structural reforms, can help absorb asymmetric economic shocks. The banking crisis, and subsequent fiscal and economic crises, hit Ireland hard in 2007 and the following years. The crisis has had a profound impact on labour mobility to and from Ireland.

Labour mobility into Ireland had helped fuel GDP growth in the two decades preceding the crisis: between 1987 and 2004 mobility into Ireland increased steadily, followed by a steep climb in 2004-07. However, from 2007 until 2014 there was a stark fall in inbound mobility and increase in outbound mobility. Mobile workers from Eastern Europe returned home and Irish citizens left the country to work abroad.

It has caused anxiety in Ireland to see its young people leave in the darkest moments of the crisis, but – and this is where Ireland has really shown itself a Celtic Phoenix – successful reforms have put Ireland back on a path of strong economic growth – the strongest GDP growth in the EU said Marianne Thyssen, Commissioner for employment.

And simultaneously, Irish mobile workers return to Ireland and other EU workers following in their footsteps attracted by Ireland's success. The youth of Ireland comes back with better skills and more experience, which they are ready to invest in shouldering their country's economic growth.

There are two important lessons for the EU states from the experience in Ireland:

·         first, for students in Europe: in bad economic times, it is better to gain working experience and develop skills abroad than to stay unemployed in own country. And when the tide starts turning, one wants to return home to put skills to the benefit of a home country.

·         the second is a lesson for policymakers at European and national level: labour mobility will only help absorb economic shocks and will only benefit Europe's economy sustainably if at the same time structural reform measures are taken to ensure that growth and job creation are present also in the countries from which many workers leave. Otherwise labour mobility will provide growth in the economically stronger states only and will deepen the gap between EU states instead of bridging it.

Both mentioned aspects are amongst 10 highest Commission priorities; hence, the following measures are expected:

·         deeper and fairer internal market for goods, capital, services and for workers – so that they can move more freely within the internal market.

·         growth and job creation everywhere in the Union, through structural reforms and the implementation of an ambitious investment plan.

This is part of Commission’s vision for fair labour mobility in Europe in order to make sure that labour mobility is a positive choice for people, not a choice that they are forced to make argued Marianne Thyssen, Commissioner for employment.

Third part of the Commission's strategy

In order for labour mobility to benefit the member states, structural reforms are needed. This is the third and last part of the Commission's strategy for a fair labour mobility that creates jobs and growth. It is the most controversial part of the strategy as citizens question the conditions on which people can move to another EU state, e.g. conditions under which mobile citizens can access welfare benefits in another member state.

Thus, the Commission task is to explain to the people what the rules are, why they are fair and how they are enforced. The Commission carried out a thorough analysis of the existing rules on social security coordination and on posting for the people, for businesses and for taxpayers.

In a few weeks the detailed results of the analysis will be presented.

In the Commission’s analysis of social security coordination rules, there is a need to clarify how the rights of a worker differ from those of a jobseeker, or of not economically active citizens.

The right to movement of jobseekers also needs to be upheld, particularly in light of the highly diverging unemployment figures between the states. It is essential, however, that this is not at the expense of the host country's social security system. With this in mind, the Commission wants to make it possible for someone who becomes unemployed to take unemployment benefits to another country where he/she may have a better chance of finding a job. This is already possible today for a period of 3 months; the Commission wants to prolong it to 6 months.

Non-active persons (people who are not working nor actively looking for a job) are in a different category: already under the existing rules, they need to meet certain requirements to have a right or residence in another EU state.

The European Court of Justice has recently clarified that people with no right of residence can be refused access to benefits; this principle shall be codified in the EU case law, means the Commissioner.  

Another area which needs clarity and legal certainty relates to long-term care benefits. More and more EU states provide such benefits with the aim to allow people who are dependent on help from others in their daily lives to get such help. Today, there are no explicit coordination rules for such benefits. It shall be clear whether mobile citizens are entitled to long‑term care benefits when they move abroad.

Another proposal relates to unemployment benefits for frontier workers. Today, when a frontier worker loses his job, he receives unemployment benefits in the country where he lives, even though he has been paying contributions in another country, then in one where he worked. The Commission suggests that after a year the country of work becomes responsible; one receives benefits where ne/she contributed. The national authorities in the member states exchange information and cooperate, for example in the Administrative Commission at European level.

The Commission is thoroughly assessing the rules determining the employment conditions for posted workers (those rules are laid down in the 1996 Posting of Workers Directive).

The fundamental difference with a posted worker is that he/she, unlike the mobile worker, remains employed in his home country. Nevertheless, the 1996 Directive foresees that the posted worker is subject to a core set of labour law rules in the country where he temporarily carries out work.

As regards wages, the 1996 Directive stipulates that statutory minimum wages and minimum rates of pay laid down in generally applicable collective agreements in the country of work, are to be applied also to posted workers. The problem, however, is that the Directive caters less well for wage-setting systems in which decentralised collective bargaining plays a strong role.

In low skills sectors, such as construction, wage gaps of up to 30% are observed between posted workers and local workers. In some countries, posted workers can represent up to 10% or more of the labour force in those sectors, posting can exercise a downward pressure on wages here.

While the overall number of posted workers remains limited in the EU at 1.45 million, and said wage gap is observed only for a limited proportion of those, the Commission has stated that the principle of equal pay for equal work at the same location should apply to posting and that there is no place for social dumping in the Union.

The principle of 'equal work for equal pay' is well established in the EU Treaties. The EU has also introduced it for fixed-term and part-time work, for seasonal and temporary agency work. This right should be applied to posted workers too. Posted workers should not be treated as second-class workers; they too deserve equal pay for equal work on the same site.

Reference: European Commission, Speech 15-6074 by the Commissioner for employment, social affairs and labour mobility, Marianne Thyssen (Maynooth University of Ireland, Dublin), 13 November 2015. In:

http://europa.eu/rapid/press-release_SPEECH-15-6074_en.htm?locale=en