Table of Contents

  • Not long ago, many OECD countries were looking to labour migration as one way to address labour shortages and the expected declines in the working-age population as a result of ageing. This was to be the new age of labour migration. High levels of migration were being recorded in the new migration countries of southern Europe and more widely, in the European Economic Area, following EU enlargement. At the same time, the traditional settlement countries (Australia, Canada, New Zealand and the United States) were also seeing their highest immigration levels in recent decades.

  • While it is too early to have a clear view of the full impact of the unfolding economic crisis on net migration flows, the expected consequences on labour market outcomes of immigrants are unambiguous: past experience has shown that immigrants are among those hardest hit in the labour market during a downturn.

    In most OECD countries, immigrants have made an important contribution to employment growth during the past decade. In some cases, relatively easy access to labour through international recruitment has contributed to limit wage increases and to fuel the expansion phase. The big rise in the construction sector in several OECD countries is illustrative of this phenomenon. This means that the deterioration in labour market conditions will probably be stronger in countries which have recently witnessed the most rapid increase in migration flows (e.g. Ireland, Spain, the United Kingdom or, to a lesser extent, the United States). More generally, given their characteristics and distribution across sectors, migrant workers are expected to be particularly vulnerable to changes in the labour market due to the economic downturn.

  • With fewer young people entering the labour market and baby-boomers retiring, many OECD countries have been looking to labour migration to help fill the expected shortfalls in labour supply over the coming decades. Although international migration is not the only way to address these shortfalls – technology, outsourcing and greater mobilisation of the domestic labour supply are others – it may play an important role in satisfying needs in certain occupations and in certain countries. At the same time, labour migration management has become an imperative, because of concerns about competition with native workers and the persistence of irregular migration and because the labour market outcomes of past immigrants and their children have not always been as favourable as expected. Public opinion in many OECD countries may not be willing to encourage further significant labour migration if these issues are not resolved.