Ukrainian Emigration to the EU: Labour Market Perspective

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Ukrainian Emigration to the EULabour Market
Perspective

• Oleksandra Betliy
• Warsaw, June 11, 2013

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Content

• Ukraine some facts
• Migration profile of Ukraine
• Visa policy
• Ukraine and the EU
• Migration policy
• Experts about future migration of Ukrainians to
  the EU

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Ukraine some facts
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Ukraine
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Population 45.6 millions as January 1, 2012
51.9 millions as January 1, 1991 Urban
population 69 of total Share of children (0-14
years) 14 of total in 2012 21 of total
in 1991 Share of people older than 65 15 of
total in 2012 12 of total in 1991 Life
expectancy at birth 71.0 years including
females 75.9 years males 66.0 years
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Economic situation
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Major shock transformation from centrally
planned to market economy after the collapse of
the USSR
Source Ukrstat
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Unemployment patterns
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Source Ukrstat
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Coping mechanisms for households
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• Engagement of informal activities
• Migration
• Risk aversion, including work after retirement,
  low job mobility, readiness to work despite wage
  arrears and forced part-time job, and high
  employment in public sectors
• Downturn in consumption
• Family support and social safety nets
• Delayed payments for housing and utility services
  
• Households savings
• Development of small business
• Crime

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Migration profile of Ukraine
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Migration profile of Ukraine

• 1.2 m individuals (3.4 of population in age
  between 15-70 years old) either worked or looked
  for a job abroad in the period of January 2010 -
  June 2012 (results of recent Ukrstats survey)
• 98.2 of these individuals worked abroad, while
  the rest looked for a job
• 4.8 and 2.2 of economically active men and
  women, respectively, were labour migrants
• 2.2 and 6.3 of economically active individuals
  in urban and rural areas, respectively, were
  labour migrants
• 64.9 of labour migrants had complete secondary
  education. while 15.4 had tertiary education.
• Number of labour migrants reduced
• Share of labour migrants in working labour force
  reduced from 5.1 in 2005-2008 to 4.1 in
  2010-2012

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Migration profile of Ukraine Origin of labour
migrants
Source Ukrstat survey
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Migration profile of Ukraine
Source Ukrstat survey
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Migration profile of Ukraine status of migrants

• Many migrants work on seasonal works circular
  migration
• Between 2010-2012 one labour migrant made on
  average 3 trips
• Average length of work 5 months
• Frequency of home visits depends on the
  destination country (due to visa regimes)
• High share of illegal migrants

Source Ukrstat survey
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Migration profile of Ukrainedestination
countries
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Source Ukrstat survey
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Migration profile of Ukrainesector of work
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Source Ukrstat survey
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Migration profile of Ukraine
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Source Ukrstat survey
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Migration profile of Ukraineskills mismatch
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• Ukrainian labour market is characterized by high
  skills mismatch. More than 50 of employed are
  formally overqualified for their jobs
• On domestic market there is a oversupply of
  white-collar workers, and a deficit of
  blue-collar skilled employees
• There is an evidence of occupational downshifting
  (brain waste) among Ukrainian migrants
• As a result, depleted human capital and lower
  productivity (if these migrants return to
  Ukrainian labour market)

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Migration profile of Ukraine
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Total Women Women Men Urban Rural
Number of labour migrants, thous. persons 1161 403.2 403.2 757.7 529.0 631.9
Including, Including, Including, Including, Including, Including, Including,
Equivalent occupation 28.7 10.9 38.1 38.1 32.8 25.2
Different from qualification 23.7 28.0 21.4 21.4 29.0 19.2
With lower qualification 5.2 5.3 5.1 5.1 8.3 2.5
With higher qualification 2.6 2.8 2.4 2.4 2.9 2.3
At work, which does not require qualification 39.5 53.0 32.3 32.3 26.6 50.2
Not defined 0.3 - 0.7 0.7 0.4 0.6
Source Ukrstat survey
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Migration profile of Ukrainepush factors
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• In the beginning of 90s personal (including
  ethnic) motives for migration dominated, while
  later migration became labour-driven
• Major reasons for labour migration
• Low employment opportunities
• Low earnings
• Unstable earnings (wage arrears, administrative
  leaves, etc.)
• (At a lower degree) lack of protection of human
  rights

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Migration profile of Ukraine
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Average wage in Ukraine in 2010-2012 USD 329  Total, thous. pers. Distribution of earning in USD, Distribution of earning in USD, Distribution of earning in USD, Distribution of earning in USD, Distribution of earning in USD, Average monthly earnings, USD,2010-12
Average wage in Ukraine in 2010-2012 USD 329  Total, thous. pers. lt 250 251? 500 501? 1000 1001-2000 gt2000 Average monthly earnings, USD,2010-12
Number of labour migrants that reported earnings 1002 4.4 21.8 43.1 24.8 5.9 930
Russia 407.7 2.6 24.8 46.2 23.0 3.4 874
Poland 151.4 14.9 40.4 38.4 5.4 0.9 560
Italy 146.6 4.4 11.5 47.1 27.4 9.8 1056
Czech Republic 131.6 2.7 6.0 41.5 44.3 5.4 1137
Spain 43.5 - 19.8 49.4 26.7 3.9 943
Germany 27.8 - - 25.5 25.5 48.9 1798
Hungary 19.6 - - 70.9 29.1 - 969
Portugal 18.6 - 10.8 53.8 31.2 4.3 1019
Belarus 17.9 8.4 70.9 20.7 - - 432
Other 37.7 - 20.2 16.7 46.7 16.2 1306
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Migration profile of Ukraine
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• Impact of migration
• Worsened demographic situation near 1.1 m
  persons emigrated reduction of working-age
  population. Besides, migration often means delay
  in childbirth
• Labour market impact
• Brain drain and brain waste
• Likely reduces labour market pressure
• Often improves welfare of households through
  remittances
• Remittances are mostly spent on everyday
  consumption, purchase of durables
• 12 of migrant households spend remittances on
  education
• Increase pressure to social security and health
  care systems as temporary migrants dont
  contribute to the system, but demand services
  after return

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Visa policy
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Visa policy
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• Ukraine is encircled with substantial and
  non-symmetrical visa barriers
• Visa barriers restrict migration flows (however,
  likely only to a limited extent)
• Citizens of Ukraine can travel visa-free to 43
  countries of the world , mostly to CIS countries
  and the countries that intend to attract tourists
• Visa policy of foreign countries towards citizens
  of Ukraine is not always open and transparent
• According to a research by Ukrainian think-tanks,
  visa practices of the consulates of the EU member
  states may be divided into four groups
  friendly, neutral, contrasting and
  problematic

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Visa policy
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Source Europe without barriers, Independent
Monitoring Findings 2012
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Ukraine and the EU
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Ukraine and the EU
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• In November 2010 Ukraine received the Action Plan
  on Visa Liberalization from the EU. The second
  block of elements of the Action plan is Illegal
  Migration, Including Readmission, which among
  others envisages following measures
• Adoption of a National Migration Management
  Strategy for effective implementation of the
  legal framework for migration policy and an
  Action Plan
• Establishment of a mechanism for the monitoring
  of migration flows, defining a regularly updated
  migration profile for Ukraine.
• Future visa liberalisation will make it easier
  for Ukrainians to travel to the EU countries and
  is expected to benefit Ukrainians
• In 2011 the National Action Plan on Visa
  Liberalization was approved
• The EU has high concerns to visa liberalization
  due to migration threats and large financial
  revenues from Consular fees

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Ukraine and the EU
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• Facilitation of movement of persons is also a
  separate article in the Association Agreement
• In March 2012 Ukraine and the EU initialed the
  Association Agreement, which envisages DCFTA. It
  might be signed in November 2013 if Ukraine
  fulfills requirements
• The AA envisages somewhat higher labour mobility
• The Parties shall take gradual steps towards a
  visa-free regime in due course provided that the
  conditions for well-managed and secure mobility,
  set out in the two-phase Action Plan on Visa
  Liberalization presented at the EU-Ukraine Summit
  of 22 November 2010, are in place.
• Ukraine is likely to benefit from the AA in terms
  of higher welfare

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Migration policy
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Migration policy
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• Ukraines migration regulatory framework improved
  recently
• The Concept of Migration Policy of Ukraine was
  endorsed by the Presidential Decree
• The Government approved Resolution On Creation
  of a Single National Database of Migration Flows
  Management
• The State Migration Service was created in 2011
  (however, it still criticized for low
  institutional capacities)
• Without wide vision and deep understanding of the
  migration situation in the country, migration
  legislation will not be effective
• Protection of rights of Ukrainian migrants
  remains inadequate
• Effective system for collecting, processing and
  analyzing the statistic and institutional data on
  migration of Ukrainians abroad is absent
• As labour migration is high, Ukrainian migration
  policy should make it legitimate and ensure
  protection (social and of human rights) of labour
  migrants as well as envisage policies for
  reintegration of returnees into society

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Migration policy
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• Two government bodies are responsible for
  development and implementation of migration
  policy in Ukraine
• The State Migration Service of Ukraine (SMSU),
  which is subordinated to the Ministry of Internal
  Affairs
• responsible for registration of residents and
  non-residents (including refugees), citizenship
  issues handling, combating illegal migration and
  elaboration of migration policy
• The Ministry of Social Policy of Ukraine.
• responsible for labour migration regulation
• Ukraine is a party to 13 bilateral agreements on
  employment and social protection of migrant
  workers (with Baltic States, Bulgaria, Spain,
  Libya, the Czech Republic, Mongolia, Portugal,
  Poland, Romania, Slovakia, Hungary and Czech
  Republic)
• The implementation of existing agreements on
  social protection is difficult due to lack of
  implementation mechanisms, financial resources
  and qualified personnel ? the level of social
  protection of Ukraines labour migrants is very
  low

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Experts about future migration of Ukrainians to
the EU
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Future migration of Ukrainians to the EU
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• The emigration flows might increase if economic
  and political uncertainty in Ukraine surges
• Recently, the emigration mood of Ukrainians has
  expanded
• More young people consider opportunities to
  receive education abroad. As degrees received
  abroad are not directly transferable (the
  nostrifikation is required), this creates
  additional pressure for such individuals to look
  for a job abroad
• Visa regime with the EU is perceived to be a
  barrier for tourism rather than for work abroad

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Future migration of Ukrainians to the EU visa
liberalisation impact
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• Experts (as revealed by several studies and
  interviews) predominantly do not expect
  significant increase in migration of Ukrainians
  to the EU after visa liberalization
• In particular, migration potential is limited
  near 6 of Ukrainians intended to leave the
  country for more than half a year (3.7 defined
  the Schengen Area as their desired destination).
  Only 1.5 planned labour migration or permanent
  residency
• Number of legal migrants might increase due to
  legalisation of currently illegal migrants
• We can expect an jump in migration due to family
  reunion of formerly illegal migrants
• However, further research is needed to reveal
  more thoroughly the impact of visa liberalisation
  on migration flows from Ukraine

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Literature (selected)

• Coupe Tom. Vakhitova Hanna. Costs and Benefits of
  Labour Mobility between the EU and the Eastern
  Partnership Partner Countries. Country report
  Ukraine, ENPI, February 15, 2013
• Documents Security and Migration Policy
  Assessments and Recommendations of the
  International Working Groups for Ukraine, Policy
  Paper, Europe Without Barriers, 2011
• Implementation of Action Plan on Visa
  Liberalisation a Case of Ukraine, Independent
  Monitoring Findings, Policy Paper, Europe Without
  Barriers, 2012
• Kipen V., Avksentyeva M., Migration Potential of
  Ukraine in the Context of Visa Regime with the EU
  
• Petrova Iryna. Social Impacts of Eurointegration
  of Ukraine Labour Market. October 2012 (in
  Ukrainian)
• Poznyak Oleksiy. Social Impacts of
  Eurointegration of Ukraine Migration. October
  2012 (in Ukrainian)
• The EU Visa Policy in Ukraine Independent
  Monitoring Findings 2012, Monitoring paper,
  Europe Without Barriers, 2012
• Ukraine Extended Migration Profile, EC, 2011
• Ukrstat presentations on the results of Migration
  survey - 2012, May 2013

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Contacts
Oleksandra Betliy betliy_at_ier.kiev.ua Institute
for Economic Research and Policy
Consulting Reytarska str. 8/5-?. Kyiv
01034 Ukraine tel. [phone].
278-6342 Fax [phone] www.ier.com.ua ins
titute_at_ier.kiev.ua