Labour market performance and migration flows - European ...

European CommissionOccasional Paper 60, Volume Ithe labour market induced by retirement, will constitute the larger component (80% of total projectedincrease in labour demand and, for the highest-skilled segment, 61%; see Table 2 in Venturini,Fakhoury and Jouant 2009).Indeed, Europe is already experiencing an excess demand for skilled labour that is not satisfied bydomestic supply and that is satisfied only partially by the labour supply coming from EasternEuropean countries. In the not so distant future labour supply from the new Member States will not beavailable for migration anymore, and, as could have been predicted before the recent recession, therewill be an open demand for high and medium-skilled migrant labour.Figure 6.3.2.1 Scenarios compared: expansion of demand by qualification, 2006-2015, EU-25Source: CEDEFOP, Future Skill Needs in Europe, p. 63.On the other hand, AMCs instead suffer from an excess supply of educated workers (see Section2.4 above on graduate unemployment in AMCs). AMC labour force participation rates have a Vshape with the highest participation rate among the illiterate and the university-educated both in urbanand rural areas (for Egypt, for instance, see Assaad, 2007). Unemployment affects mainly the young(15-29), and increases with the level of education (see Section 2.4 and Table 2.4.1). It is frictional forthe level below middle school and increases for general secondary, technical secondary, postsecondary institute and university. The higher unemployment rates among the highly educated arecommon to all the AMCs, and the number of graduate unemployed has already reached 1 million andis increasing rapidly (and this without taking into consideration the high rate of inactivity amonggraduate women). Of course, not all the graduate unemployed are ready to emigrate, and in particularnot all unemployed women are ready to do so: many of them, as in Egypt or Jordan, are in search of ajob in the public sector. This notwithstanding, AMCs provide an available pool for recruiting foreignskilled labour because there is an available graduate labour supply and, in the foreseeable future, alack of sufficient labour demand for skilled workers. From an European perspective, this matching ofEU medium- and highly-skilled labour demand and AMCs excess labour supply would partiallydampen the main factor for social instability in the region, and hence have positive externalities forEurope by preventing spill-over into the neighbouring European countries. To this extent, investment88