Migration and its Effects on Demographic and Economic Development in Romania

2011–2012

ERSTE Foundation Fellowship for Social Research Should we stay or should we go?

Migration and its effects on demographic and economic development in Central Eastern Europe

Migration and its Effects on Demographic and Economic Develop­ ment in Romania Tatiana-Roxana Nae

TATIANA-ROXANA NAE ERSTE Foundation Vienna Fellow Bucharest University of Economic Studies Romana Square no. 6, Bucharest, Romania Telephone: +40724504910; E-mail: nae.roxana@yahoo.com Paper supported by

MIGRATION AND ITS EFFECTS ON ECONOMIC AND DEMOGRAPHIC DEVELOPMENT IN ROMANIA

Abstract This paper focuses on the theme of Romanian migration, which has echoes in the economic, demographic, and social environments, and still needs effective policies. The first part of this paper is a descriptive analysis of the characteristics of Romanian emigration. The second part discusses its economic and socio-demographic effects on the past and future. The third part particularizes the findings of an exploratory research study of highly educated people’s intention to emigrate from Romania, in hopes of identifying significant relationships between the intention to emigrate and its determinants.

Introduction Nowadays, interest in migration is generated not only by its effects, but also by the necessity of European Union policies regarding this phenomenon. Many think that there is no need for a strategy around migration; they act as if migration is under control and can be handled through other mechanisms. Romania seems to be such an example. As an EU 1

member state, Romania has specific projections regarding migration. On one hand, the Romanian government has no clear migration policy and denies that they need one; on the other hand, EU member states are confronted with huge flows of Romanian emigrants.

National and international media depicts these stances in various ways, from the Roma community problem to “brain drain.� But are these the real challenges that face states? The migratory process will be a permanent reality because people are moving. A better approach of migration panorama might answer the question of what can be done to maximize the benefits of migration for the origin countries, destination countries, and individuals.

Since 2007, free access to the European labor market made Romania more a sending country than a destination. If it was previously easy to count permanent and non-permanent migrant people, this year the statistic system faced a methodological problem. It lacked information not only about the number of migrants, but also about the population of the country and structural indicators. Hopefully, a new census survey that was taken by the National Institute for Statistics in October 2011 (once every ten years) will deliver the correct data by the end of 2012. Meanwhile, migration activists are left to estimate the numbers and consequences of people’s movements.

1. Underestimated Romanian migration flows It is very hard to find information about the number of emigrant persons. It is easier to find data about the number of immigrants. Because people who immigrate to Romania are usually from outside the European Union, they are officially registered (such as in the cases of Moldavians and Turkish people). The count of inflowing migrants to Romania is more accurate than the outflows. Since Romania was given free access to the labor market in 2007, it has been hard to differentiate between a permanent and temporary migrants. A person who works in one EU country for three years and visits Romania a few times per year would generally be considered a temporary migrant, since the majority of his activities are in the host country.

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Although media speculates about migration problems, we must recognize its power to send messages and reveal issues that are not usually identified or discussed by official bodies.

Sometimes, the origin country is not aware of the flows of migrants; this is true for Romania. Because Romania registers only few of the people who leave, the official authorities believe that there are not many people leaving the country. This combined with the fact that the National Institute for Statistics only counts permanent migrants (meaning those who left the country and changed their permanent residence), creates the illusion of no migratory policy problem. This illusion vanishes when Spain and Italy, for example, count their Romanian immigrants, or when the Romanian National Bank counts the inflows of remittances. We should accept the fact that Romania is an emigration country, and the origin country of many types of migrants, each with their own group characteristics (Roma migrants, low-skilled or highly-skilled migrants, temporary or permanent migrants, etc.). In addition, Romania has also its immigrants.

Eurostat publishes data regarding migration for EU countries. Here, we can find some pertinent information about migrants in receiving countries. In 2006, Romanians and Polish citizens were the most numerous both in absolute numbers and relative terms. Spain was the main destination of about 250,000 Romanians in 2006 (Eurostat Statistics in focus, 2008). By the end of 2008, Romanians were the second most numerous group of foreign citizens residing in the EU member states, making up 6.2% of the total EU foreign population. In 2008, the twenty-seven member states received 384,000 Romanian citizens, 266,000 Polish citizens, and 91,000 Bulgarian citizens (Migrants in Europe, 2011 published by Eurostat).

Some evidence shows a great discrepancy between national statistics, the image portrayed by public opinion or media, and the problems that destination countries confront. Although the international community discusses Romanians’ migration, in our country there are few studies regarding migration dimensions and causes (Alexe, 2009; Sandu, 2007) or labor force connection to migration (Ailenei, 2009; Purica, 2008; Č˜erban and Toth, 2007, Sandu et al, 2004 and 2010).

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While the Romanian National Institute for Statistics shows small annual numbers of emigrants leaving Romania (Table 1), OECD and World Bank estimated a much higher number of Romanian immigrants in some of the most desirable countries.

Table 1: Romanian emigrants and immigrants that changed their permanent residence - absolute numbers of personsYears

Emigrants

Immigrants

2000

14753

11024

2001

9921

10350

2002

8154

6582

2003

10673

3267

2004

13082

2987

2005

10938

3704

2006

14197

7714

2007

8830

9575

2008

8739

10030

Source: Romanian National Institute for Statistics data basis Romanian researchers are also portraying a more powerful emigration phenomenon. For example, National Institute for Statistics registered 14,197 Romanian emigrants in 2006, Sandu estimated 777,200 emigrants for the same year, and UNFPA considered that “about 2 millions persons are working and living relatively stable abroad but without being definitively gone from Romania� (UNFPA 2007).

If we look at Italy and Spain, where the estimated number of emigrants is the highest (Table 2), we can see that the numbers are overwhelming. In Italy, for example, there is a difference of 687,877 Romanians between 2005 and 2010. The sum of all emigrants between 2005 and 2008 (Table 1) is 42,704. The Romanian National Institute for Statistics presents the flows of emigrants that changed their permanent residence, while the estimations of OECD and World Bank consider the entire migration phenomenon,

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including permanent and temporary migration. The differences in numbers are significant, even if they reflect aspects of temporary migration (which is a wrong hypothesis, since Romanian authorities do not register the status of persons when they leave the country, and they study population structure only once every ten years, at most). The 2011 OECD international migration outlook shows that Romania has by far the largest number of emigrants at 12,000 emigrants per million population.

Whatever the difference in numbers might mean, it is clear that Romania does not have a realistic sense of the problem of emigration. Since 2007, the Romanian National Institute for Statistics has reported a positive net international migration trend, meaning that they registered more permanent immigrants than emigrants (Table 1). World Bank presented a total of 2,769,400 Romanian emigrants in 2010, comprising 13.1% of the total population (with a total estimated population of 21,14 millions), with top destination countries of Italy, Spain, Hungary, United States, United Kingdom, Austria, and France (World Bank Migration and Remittances Factbook 2011).

Table 2: Stock of Romanian migrants, counted by host countries -absolute numbersSelected European

2005

2006

2007

2008

2010

countries Austria

48041

21882

27646

32341

56932

Belgium

4790

10195

15253

20542

21634

France

27414

25152

27545

31210

54305

Germany

73043

73353

84584

94326

134911

Greece

23025

18949

25735

29456

45289

Hungary

155148

66951

65836

66368

189055

Italy

125160

342200

625278

796477

813037

3287

12035

19389

27410

32457

130771

527019

731806

796576

810471

8482

12000

19000

32000

53081

Portugal Spain United Kingdom

Source: OECD estimations for the period 2005-2008 and World Bank estimation for 2010

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All destination countries are aware of the Romanian outward migration flows, while Romanian authorities confront problems that cannot be solved without admitting that the emigration phenomenon is increasing. This is the reason why migration—and specifically emigration—must be approached with structured actions that can advance national migration policy.

2. Background and characteristics of the Romanians emigration phenomenon 2.1. Times and patterns of Romanian migration The strings of Romanian abroad emigration process were pulled after 1989, as a consequence of the great political change from the winter of that year. Two periods stand out when speaking about Romanian emigration: pre-2007 was dominated by permanent emigration, while the years after 2007 constitute a period of mixed emigration, the majority of which was temporary. This section will discuss the specific problem of Romanian emigration, especially after 2007. This second segment, being well controlled and registered at national level (by Romania, as a host country, but also by the origin countries), will not be discussed here, as its effects are better and easily controlled.

Between 1990 and 2007, several episodes of emigration characterized Romania. The first was political asylum in the three years after communism fell. It was at this moment that ethnic minorities, such as Germans and Jews, left Romania permanently. At the same time, Romanians moved to Canada, the United States, and Germany—a trend that continued from 1990 through 2001. During these eleven years, temporary emigration was limited to only seasonal and illegal work departures, or labor agreements with countries like Germany, Spain, and Italy, “the most dynamic segment of total migration” (Sandu et al, 2004). Starting in 2002, the three-month legal tourist stay and free movement in Schengen area contributed to large temporary emigration flows. A mixed emigration structure existed from 2002 until 2007 it was: permanent emigration (as counted by the National Institute for

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Statistics) and temporary emigration were hidden from authorities, making them very hard to measure.

Romania joined the European Union in 2007, gaining free access to the labor market. This was the starting point of a new migration period. Emigration skyrocketed in comparison to permanent migration (according to estimations using sources such as remittance inflows).

This pattern of emigration for labor created many new policy and population problems.

Just as 2007 was a turning point in the structure of emigration, 2012 might play an important role in the economy of emigration. Yet even now (in 2011), it is difficult to provide a data set about temporary migration. Usually, statistical data is still preliminary and represents estimations. There are no concerns regarding the immigration population in Romania, because the top source countries for immigration are usually non-EU (Moldavia, Ukraine, the Syrian Arab Republic, Russian Federation), and immigrants are legally registered (World Bank, 2011). The situation could easily collapse into political and economic crisis; some restrictions regarding Romanian migrants are likely to arise in 2012.

2.2. The importance of an accurate emigration portrait Past, present, and future flows, and characteristics of migration are important to understand when creating policy and determining the desired effects of migration. It is almost impossible to forecast Romanians’ emigration future based on historical data, since measurement of international emigration was neglected. We have several ways to form a realistic sense of Romanian emigration process: remittances flows, but with the amendment that not all remittances are transferred through bank accounts or registered; census data, which contains details about temporary migrants but is only collected once every ten years; using surveys, which are fruitful, but not useful for generalizing about the population of the entire country, especially when nonprobability samples are used.

When no historical data is available and the need for policies arises, collecting information about potential migrants might help. Although intentions are not the same as actual moves,

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knowing which people intend to emigrate, what their motivations are, and how their opinions influence their migration decisions can help to anticipate and obtain future desired effects of migration for origin countries, host countries, and individuals. Beside the official data about permanent emigration, Sandu’s surveys are well known in Romania for their insights regarding temporary migration. He estimated that there were 2.2 million Romanians abroad in 2006, and 2.8 million in 2008—40% in Italy and 30% in Spain (Sandu, 2010). Keeping in mind that (according to World Bank) the Romanian labor force was 9.7 million in 2008, and knowing that the majority of Romanian migration after 2007 was labor migration, the amount of emigrants seems to be huge compared to the labor force. Yet Romania does not have the biggest emigration flows of all EU states. Although the surveys are generally not an accurate count of emigrants, they are valuable sources of information for predicting the future and trends of migration. Labor migration increased after 2007 due to free mobility and access to the EU labor market. With 2,769,400 Romanian emigrants in 2010—13.1% of the total population—the skilled emigration is also highlighted, with an emigration rate of tertiary-educated population of 11.8% in 2000 (World Bank, 2011). Surveys about emigration intentions, which are now used in Romania, are very helpful in analyzing labor migration (Zaiceva and Zimmermann, 2008). In Section 4, I will discuss the results of a study about migration intentions of a special group of Romanians, and reveal a situation that will have many effects the future. When confronted with economic crisis, Romania neglected to pay attention to policies and migration effects, but the long-term consequences of migration will make it a subject of interest.

3. Discussions about the effects of Romanian emigration on economy, demography, and society 3.1. Relevant theories of effects nature Both positive and negative effects occur in origin and destination countries. Origin countries claim that they invest in skills development of people that then leave the country, leading to a long-term economic and social gap. When policies do not correlate with the

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realities of migration, such deprivations may have negatively effect the labor market and the economic development of origin countries. At the same time, the beneficial role of remittances is well known. Of course, destination countries feel the negative effects of remittances, but they usually receive a positive economic reaction when it is about trained and qualified migrants (engineers, doctors) special conditions being offered to them, in order to generate the desired effects. In some situations, immigrants are believed to cause rises in the unemployment rate, criminality, and cultural deterioration of destination countries (the migrant Roma community in particular are blamed for the last two).

Migration effects are seen more in terms of economic and social aspects, and less from a demographic point of view. Some recent theories of migration’s impact on economic and social development are those of Ratha et al. (2011), who highlight the positive effects on migrant households, sending countries, and receiving countries. From these, most migration impact studies focus only on the direct social and economic effects of migration. However, remittances might also have a significant impact on the lives of non-migrants (Frank and Hummer, 2002).

Some authors cite evidence that remittances are disproportionally spent on education and health, rather than on everyday consumption (Adams et al, 2008; Valero-Gil, 2008) but we must keep in mind the degree of poverty that origin countries confront. Other studies mention the potentially adverse effects of remittances for domestic savings, since they support private consumption of imported goods, which can decrease competitiveness and increase trade deficits (Kireyev, 2006).

Labor migration is perceived as a response to poverty (Quinn, 2006; Hampshire, 2002).

Literature in the field suggests that economic crises in origin countries may increase remittance transfers (Blue, 2004). Although public opinion is that immigrants might be responsible for rising unemployment among the native population, literature shows there is no serious evidence to this effect (Papademetriou et al, 2009). Literature often mentions that the phenomenon of highly-skilled emigration can reduce the sending country’s productive capacity (Ratha et al, 2011), or disturb the education and health sectors of small

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countries that face shortages of health workers (Docquier et al, 2010); this is the case in Romania. High-skilled migration should be seen as a symptom of development failure, rather than the cause of this failure (Lowell and Findlay 2002). In addition, it is difficult to measure high-skilled migration flows due to a lack of internationally comparable data (Auriol and Sexton, 2002), so is difficult to analyze rigorously this segment of the phenomenon.

The social impact of migration on origin countries is seen as an “emotional cost,” because often separates family members—especially parents from children (D’Emilio et al, 2007).

On the other hand, it is obvious that migrants move in cultural groups (Castles and Miller, 2009), and this creates multicultural spaces with new rules to respect in new corners of society.

When analyzing the characteristics of Romanian migration (labor emigration being the specific determinant), the effects on Romania (as origin country) and destination countries can be discussed via changes that have already occurred, as well as those that are expected to appear in their economies, demographics, and societies. These types of changes are linked and often examined together. Katseli names some effects that are transmitted through communication channels of migration: growth, poverty, income distribution, and social effects (2006). These are general terms that have specific meanings for each country, depending on its profile.

3.2. Migration effects on economic development Many economic effects are generated through remittances flows. In Romania, these effects are seen in the GDP, the national trade balance sheet, inflation, the currency exchange rate, consumption (less on investments environment), salaries, occupation of labor force, and— as a consequence of this last one—the unemployment rate.

In a competitive market environment, free movement of labor and capital should increase competitiveness. This occurs in the labor force through migratory movement of workers

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from a country or area with a low productivity to countries with higher incomes, greater competition, and a younger labor force. From an economic point of view, both emigration and immigration countries will benefit from better outcomes, but their general situation will not necessarily improve. Changes in labor supply and demand, and remittance flows can have an intense economic impact. It should benefit Romania, an origin country of emigrants with high inward remittances flows, for its citizens to use their competencies and skills in countries with better pay. The budgets, living standards, and well-being of families left behind increase on the microeconomic level. In Romania, remittances are still used mostly for consumption and education of those relatives left behind, and less for investments.

In the macroeconomic view, the pressure of unemployment should decrease and citizens left behind should be better able to integrate in the national labor market. In the absence of remittances, emigration can affect the origin country population. The economy is affected by “brain drain,” the counterpart of which—“brain gain”—is studied by many destination country researcher (Dustman, 2010; Syed, 2008). Of course, “brain drain” in the origin country causes a long-term drop in productivity and economic development, and a structural labor force disturbance, while national industries might lose their innovation capacity. The literature on “brain drain” is rich with distinctions between the migration of youth, researchers and scientists, and other highly skilled people. Remittances counterbalance the effects of “brain drain,” and represent financial flows that are hopefully used later as investments in human and physical capital. This is not yet the case in Romania because of the investments environment, but remittances could have a positive impact on productivity and employment, both directly and indirectly, through capital formation.

The Romanian migratory labor force produces economic impacts on destination countries by covering the demand for work in certain sectors and maintaining the profitability of these sectors; and hiring people in less-profitable but necessary sectors, which permits native skilled workers to be hired for high-productivity jobs.

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According to OECD, the low- and middle-income countries register significantly higher remittance flows than other countries. Remittances are an important source of income in Romania; income from remittances here is greater than in any other EU country (related to GDP) (European Commission, Mobility in Europe, 2010). A reduction of inward remittance flows in Romania in 2009 and 2010 reflect a downturn in economic activity in host countries. There was also a decreasing trend for outward remittances flows (Table 3).

Because migrants also use unofficial channels for remitting, the total inward and outward remittances is believed to be much higher World Bank uses an econometrical model with several factors to forecast the remittances flows. World Bank based its forecast for remittance flows (in 2010 and beyond) on the number of migrants in destination countries, and on estimates of how changes in income would influence remittance amounts.

According to World Bank, remittance flows are affected by the number of migrants in destination countries, migrant income in destination countries, and incomes in the origin country (Ratha and Shaw, 2007).

In 2009, Romania was ranked second by OECD, with 255,000 people travelling to OECD countries, but it ranked first the same year, with 12,000 emigrants per million population (International Migration Outlook, OECD, 2011). Although Romania does not have the greatest amount of people leaving the country (in absolute numbers), it has large amounts of remittances compared with other countries that send temporary emigrants. It also receives high levels of income remittances, along with Bulgaria, Lithuania, Slovakia, Czech Republic, and Poland. It is easier to appreciate this when remittances are converted to Romanian national currency, but since inflows are used to purchase imported goods, there is also a deficit in the trade balance sheet. Migration is directly reflected in Romanian balance sheet payments. Inward remittances can be seen in the current account registered

by Romanian National Bank. As I said previously, more than half of remittances are used for consumption in Romania, rather than as savings or investments (according to Romanian National Bank). Because most consumption goods are imported, money often leaves the country and—in conjunction with other causes—determines a deficit. This is an effect of uncorrelated policies of Romanian government. Starting with the crisis in destination

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countries like Spain and Italy, the Romanian inward remittance flows decrease after the boom in 2008 (Table 3), affecting the well-being and budgets of left-behind families, and creating pressure in the trade balance sheet.

Table 3: Remittances for Romania during 2003-2010 - US$ millions Years Inward remittance

2003 2004 2005 124

132 4733

2006 2007 2008 2009 2010 6718 8542 9381 4928

flows

4517 *

of which Workers’ remittances Compensation of

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18 3754

5509 6835 7580 4207

-

1165 1626 1705

651

-

110

113

954

Migrants’ transfers

-

1

25

44

81

96

71

-

Outward remittance

8

8

33

57

353

664

310

-

Workers’ remittances

1

1

4

6

289

482

243

-

Compensation of

7

5

24

42

55

169

61

-

-

2

6

8

9

13

6

-

employees

flows of which

employees Migrants’ transfers

Source: World Bank, The Migration and remittances Factbook, 2011 “*” indicates that the value is an estimation; “-“ indicates that data is not available; for comparison of the data: net foreign direct investment inflows were US$ 13.9 billion, total international reserves US$ 39.8 billion, exports of goods and services US$ 59.8 billion in 2008.

Of course, by staying in the country, migrants would have had lower incomes and would be an underutilized labor force (or unemployed), so migration is preferable. It is good that Romania receives large amounts of remittances, but it would be better to institute policies to compensate for negative impacts. It is hard to imagine the large amounts of remitted

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money being obtained in Romania from current job incomes. Instead, foreign agents from Romania should be encouraged to function and invest in the country to counterbalance inflation. The fact that purchasing power increases in the short term leads to greater demand, and the imported goods might be cheaper (which is determined also by the appreciation of national currency).

Although most of the effects generated through remittances are positive for the Romanian economy, policy measures should still be implemented to rationally and efficiently allocate remittances to investments, savings, and consumption. The EU’s receipt of large migrant cohorts in the last ten years had a positive impact on its growth. People went where they were better paid, where there was better work that utilized their skills, and where they could be more productive. In this framework, the migration of Romanians and Bulgarians between 2004 and 2007 determined a short run increase of 0.15% and a long run increase of 0.27% in the EU’s GDP in the same period (Barrel et al, 2007 and Blanchflower et al, 2007).

3.3. Migration effects on social and demographic development Romanian migration has social and individual effects. It can be difficult for people to maintain their family relations, friendships, and cultural heritage. National media often presents stories about left-behind children of migrants who miss their parents’ closeness and care. Many social effects are more complex than these, and affect both the sending and destination countries. Immigrants entering the host countries, although increasing their standard of living, often do not have the same quality of life that their family enjoys as natives, and they are stigmatized by the fact that they come from poorer sending countries.

Some ethnic migrants face discrimination, such as the Roma community, which is widely believed to deteriorate societies and increase criminality. Such negative stereotypes create a hostile environment that frustrates natives, migrants, and society in general.

Although the economic consequences of Romanian migration are not so easily observed by the public (even as they shape long-term development), social and demographic effects are

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already obvious in the decrease of Romania’s population from 23.2 million in 1990 to 21.4 million in 2011, but also in terms of aging and the decrease of births. Migration is not slowing in the EU; it will continue to shape societies more than ever. The phenomenon increased in wealthy EU countries (and in the EU in general), so the states should prepare to receive migrants by creating policies that support the positive effects of migration and integration measures.

The aging demographic and reduced birth rate will have negative effects in Romania, especially for labor markets (in numbers and structure), the education system, and the budget and social security system. Eurostat forecasts continuous growth of the aging population in EU states. Romania’s population decreased during the last two decades, from 23.2 million inhabitants in 1990 to 2.14 million inhabitants in 2009 and 2010 (Figure 1), and forecasts show that this trend will continue. The birth rate also dropped from 13.7% in 1990 to 10% in 2008, while the average age of first-time mothers increased from 22.3 in 1990 to 26 in 2008, according to Romanian National Institute for Statistics.

Source: Eurostat data basis, Demographic balance (last updated on 27.10.2011, with provisional data for 2011); for comparison, Romania’s population in 1990 was about 23.2 million inhabitants.

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Eurostat estimates that the EU’s population will increase through 2040, at which point it will decrease until 2060. They predict that the EU’s population will only increase due to migration, starting in 2015 (Eurostat data basis, Population chapter).

The demographic issue in Romania was the main factor behind introducing the private pillar to the pension system. Decreased population is not the worst evolution, but the continuous precarious age group structure (Figure 2) will lead to disequilibrium in social and economic spheres. Eurostat projects that the elderly dependency rate will increase dramatically, from 25.4% in 2008 to 52.55% in 2060 for EU-27 countries, and from 21.3 % in 2008 to 64.77% in Romania in 2060 (Table 4).

Table 4: Elderly dependency rates - in % Years

2008

2009

2010

2020

2030

2040

2050

2060

EU-27

25.4

25.6

25.9

31.37

38.33

45.52

50.16

52.55

Romania 21.3

21.3

21.4

25.58

30.23

40.65

53.81

64.77

Souce: Eurostat data basis, Population chapter; the values for 2008-2010 are provisional; the other ones are forecasted values last updated on 23.09.2011.

The previous indicator is of particular relevance: it is the ratio between the total number of elderly people at an age when they are generally economically inactive (ages 65 and over), and the number of people at working age (15-64).

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Source: Eurostat data basis, Population chapter, values last updated on 23.09.2011.

This implies that the main concern—beside an aging population—is the aging labor market.

According to Romanian National Institute for Statistics, Romania’s primary emigration age group is 26 to 40 years old, which is a portion of the working age population (this data refers to permanent registered migrants) (Figure 3).

That most people who left Romania from 1990 to 2008 were ages 26-40 will have future demographic consequences. The greatest percentage of 26- to 40-year-old emigrants was registered in 2005, when they comprised 58% of all emigrants, but the level of emigrants in this age category continued to be high in 2006, 2007, and 2008 (57.7%, 56%, and 54% respectively). A large portion of the population under 18 emigrated especially until 2004, but this can be justified by the fact that many migrants reunited with their families after 1990 by bringing their children abroad. The 18-25 category are young people who leave the country and settle abroad, sometimes postponing plans to have children, while the population decreases in many of the states where they emigrated. Receiving countries should offer better social integration conditions to the migrants in this age group, because they are not only a valuable labor force, but they also can increase the birthrate and population, adding to the country’s future labor force.

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Source: Romanian National Institute for Statistics, Yearbook, Population chapter, 2009 This evidence and its implications raise many questions: What will Romanian migration look like in the future global environment? What measures should be put into practice to mitigate potential negative effects and encourage positive ones? While immigration is at a low and hard to increase in a country with such an unattractive economic situation, positive emigration effects should be prioritized.

4. The case of a group of people who might soon leave Romania: exploratory research on the intention of highly educated people to emigrate from Romania 4.1. The rationale and methodology behind studying migration intentions By looking through an economic and socio-demographic lens, it becomes obvious that more information about migratory phenomena results in better policies. Studies of the

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intentions of migrations (Fourage and Ester, 2007; Zaiceva and Zimmermann, 2008; Blanchflower, 2007) proved the importance of using intentions data. Researchers frequently used Eurobarometers data to complete their migration portraits. This section presents a study of the intention of highly educated people from Romania to emigrate, and the implications of this future trend for Romanian migration. In general, the impacts of migration depend on the flows and structural composition of migrant people, and also on the functioning of economies in the sending and receiving countries. As the EU receives an increasing number of migrants, it needs to know who will potentially migrate to and from which states. In a paper from 2008 about provisional character, Zaiceva and Zimmermann found the potential migrants in EU states “to be young, better educated and to live in larger cities� (Zaiceva and Zimmermann, 2008). While migration data is missing, providing data about the intentions and determinants of potential Romanian emigrants might lead to highly anticipated policy changes. This case study outlines some important insights about the intention to emigrate of highly educated Romanians between the ages of 20 and 40, taking into account also some of the Eurobarometer findings.

The subjects of this research are the most vulnerable Romanians in terms of emigration: ages 20-40 and highly educated (with at least university degree). They are considered potential migrants because they are part of the active population: highly educated and eager to add their knowledge to a labor force that might or might not be prepared to integrate them. Tertiary education attainment is the percentage of people of a given age group that has attained tertiary education level; in Romania, this structure was determined by the former education policy. Tertiary education attainment is higher in Romania for two age groups: 25-34 (20.6% in 2010) and 35-44 (13.4% in 2010).

I used exploratory research regarding the intention of emigration to determine why this category chooses to either emigrate or remain in the country (questions regarding this are very relevant for the research). Methodologically speaking, the research was organized as a survey based on a questionnaire with 15 questions (28 variables included), with respondents selected through snowball method (nonprobilistic selection method). The research does not aim to be representative of the entire population, which might be

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impossible because of missing data and organizational reasons; my intention was to explore migration problems as a way to find out more about the causes and implications of migration. The questionnaire was created and filled out individually by 256 subjects living and working in Bucharest in 2011.

4.2. Research objectives and hypothesis of the study The assumption was that emigration intention exists in the group aged 20-40 that has at least a university degree. This assumption took into account that the young population has a great intention to emigrate (as Eurobarometer data shows). It used some findings from a pilot study made by the author in the spring of 2011, comprised of 114 respondents with an average age of 23.5. Regarding construction of the group of reasons for emigration, and for none migration intention, the hypotheses were based on the push and pull factors stated by World Bank (World Bank, 2007).

The main objectives of the research were: (1) characterizing the collectivity from the point of view of age, occupational status (field of labor market), incomes, etc.; (2) obtaining information regarding intention of permanent emigration in the next three years and temporary emigration in the next five years; (3) identifying the factors that determine emigration of questioned people, and the factors that determine staying in the country; (4) analyzing the opinions of respondents regarding the Romanian labor force market (especially the labor force market for young people); and (5) identifying and analyzing significant association relations between the reasons for leaving Romania or staying in the country, and the emigration intention, and also between emigration intention and other variables, such as opinion of labor market.

4.3. Analysis of the exploratory research results: findings regarding migration intentions and motivations Since the target group consisted of people ages 20-40 with university degrees, the filter questions were about the latest graduated level of study and the age of the respondents. 256

20

people filled out the questionnaire, and met the study and age criteria (the ones who did not meet these criteria or left missing values in the questionnaire were excluded from the discussed sample). The first part of the questionnaire gave a brief characterization of the respondent group. SPSS software was used for analyzing the collected data.

The respondents were divided by age, among four groups between 20 and 40 years old. 174 women and 80 men between ages 20 and 40 completed the questionnaire. For a clear picture and further reference, the distribution by age groups and gender can be seen in Table 5. Out of all the respondents, 208 were employed, 14 were unemployed, and 34 were either self-employed or in another situation. Regarding study level, 49.2% were university graduates, 47.7 held masters degrees, and 3.1 held a doctoral degree.

Table 5: Distribution by age group and gender Age * Gender Crosstabulation

Gender Female

Total

Male

20-24

20

4

24

Age

25-29

34

24

58

groups

30-34

84

30

114

35-40

36

24

60

174

82

256

Total

Source: Author’s calculations using SPSS Most respondents between the ages 30 and 40 had incomes greater than €500 per month.

Their occupational fields tended to be financial and assurance activities (14.1%), real estate transactions (12.5%), construction (11.7%), and trade activities (10.2%).

Because of the specificity of Romanian migration, the questionnaire distinguished between temporary and permanent migration, in order to see potential migrants’ perspectives over time. 30.5% of respondents intend to migrate permanently from Romania in the next three years, while a higher percent—up to 49.9%—intend to migrate temporarily in the next five years.

21

Table 6: Intention of permanent and temporary migration Intention of permanent migration in the next three years

Answers

Frequencies

Percent

Yes, for sure

78

30.5

No, for sure

114

44.5

64

25.0

256

100.0

Possible Total

Intention of temporary migration for work in the next five years

Answers

Frequencies

Percent

Very high probability

33

12.9

High probability

69

27.0

Low probability

46

18.0

Improbability

108

42.1

Total

256

100.0

Source: Author’s calculations using SPSS Regarding the push and pull factors: because the respondents were young, they are expected to become more oriented to self-accomplishment, as Fargues explains (2011), so special attention was given to this aspect when developing questions about migration determinants. The questionnaire revealed that respondents’ biggest reasons for staying in Romania were (1) fear of not finding a job abroad in line with their skills (this reason scored 3.39), and (2) fear of encountering the perceived discrimination in the labor market abroad (this reason scored 3.35). Reasons for leaving Romania were: (1) not finding a job, (2) the possibility of a greater income abroad, (3) bad job conditions, and (4) international career (Table 7).

22

Table 7: Descriptive statistics of reasons for leaving and not leaving Romania Reasons for not leaving Romania

N

Minimum Maximum

Mean

Std. Deviation

Difficulty in finding a job

256

1

5

3.39

1.634

Labor discrimination abroad

256

1

5

3.35

1.250

Lack of financial resources

256

1

5

2.98

.907

Personal reasons, health and

256

1

5

2.97

1.394

256

1

5

2.32

1.513

abroad according to skills

others Not knowing the language Reasons for emigrate from Romania

N

Minimum Maximum

Mean

Std. Deviation

Not finding a job

256

1

5

3.85

1.234

A greater income from abroad

256

1

5

3.30

1.292

256

1

5

3.24

.892

International career

256

1

5

2.84

1.675

Reuniting the family abroad

256

1

5

2.00

1.099

job Bad job conditions at the present job

Source: Author’s calculations using SPSS The most important objective of this exploratory research was to find significant relationships between push and pull factors of Romanian migration and the intention of emigration (temporary and permanent). Since the sample was not representative and data did not meet all the normal conditions (from a statistical point of view), we used nonparametric chi-tests (after verifying the preconditions for application) instead of ANOVA or other parametrical tests. The most significant analyzed relations are presented in the appendix A1-A10. The null hypothesis (H0) was that there was no significant relationship between the variables, while H1 was that the relationship was significant. Table 8 contains the association indicators and the intensity indicators for five analyzed relations.

In all presented relations, H0 was rejected and H1 was approved, as all five relations were

23

significant from statistic point of view. As can be seen, intensity indicators of the associations are high except in the last case between the variables “Intention of temporary emigration for work” and “Opinion about the fact that low incomes determine working abroad.”

Conclusions about the analyzed relationships must be interpreted, since this experimental research has a psychological context. The first two associations represent the connection between temporary emigration for work and two of the emigration motives: 30.13% of the decision to temporarily emigrate for work is related to the importance for respondents of an international career, while 24.94% of the intention to temporarily emigrate for work is associated with a greater perceived income from jobs abroad. The associations between the other identified emigration causes and temporary emigration were not significant. a.

Relation 1 is between the variables “Intention emigration for work” and Table 8: Association relations between intentionofoftemporary emigration and selected “International determinants career importance as emigration cause.”

Relation 2 is betweenChi-Square the variables “Intention of temporary emigration work” and “A Association df Asymp.

Sig (2- forIntensity of the greater income from abroad job as emigration cause.” relations a. value sided) association Relation 3 is between the variables “Intention for permanent migration” and “Importance ( )b. of difficulty in finding a job abroad according to their skills.”

Relation 1 77.105 12 .000 0.5488 Relation 4 is between the variables “Intention of temporary emigration for work” and (0.3013) “Opinion about labor market capacity to hire all persons with university degree.”

Relation 2 63.871 12 .000 0.4994 Relation 5 is between the variables “Intention of temporary emigration for work” and (0.2494) “Opinion about the fact that low incomes determine working abroad.”

Relation 3 92.161 8 .000 0.6000 b.

(0.3600) Relation 4 86.187 12 Source: Author’s calculation using SPSS.

.000

Relation 5

.000

31.301

9

0.5802 (0.3366) 0.3496 (0.1222)

a. Relation 1 is between the variables “Intention of temporary emigration for work” and “International career importance as emigration cause.”

Relation 2 is between the variables “Intention of temporary emigration for work” and “A greater income from abroad job as emigration cause.”

24 Relation 3 is between the variables “Intention for permanent migration” and “Importance of difficulty in finding a job abroad according to their skills.”

The association with the highest intensity (0.60) is the one between intention of permanent migration and the importance of difficulty in finding a job abroad according to migrants’ skills. The fear that their skills might not be recognized abroad is related to the intention of permanent migration of this group, because they are highly educated and skilled, and they expect to apply this in their work.

The last two associations show that migration for temporary emigration is also related to opinions about the labor market’s capacity to hire all persons with at least a university degree (association with high intensity of 0.58), and the opinion of low incomes determining work abroad (although the relation is significant, it is not intense, and the effect of this opinion is very low, although many respondents approved the idea according to which low incomes in the origin country determine persons working abroad).

The opinions of respondents about the labor market in general concluded to the perception of the vulnerability of the Romanian labor market and also that they are convinced that youth will soon migrate from Romania, due to economic and social causes. When asked about integration, the most important aspects they noted were: (1) “the existence of working contract before leaving Romania” (average score of 9.21 from a maximum possible score of 10), and (2) “having connections, friends or relatives abroad” (average score of 7.37 from a maximum possible score of 10). The UK, Canada, United States, Italy, and Spain were the most desirable destination countries for this group. Knowing all this, the authorities from both Romania and the destination countries could implement policies that include these aspects to more effectively shape the migratory phenomenon.

Conclusions and policy interactions To optimize positive economic effects of migration, the International Labor Organization recommends that migration be treated as part of economic and social transformation. It highlights the necessity of improving the framework for qualification and skills-recognition

25

in emigration countries, as well as the promotion of suitable financial instruments that are adapted to migrants’ income level and requirements, since remittances primarily benefit origin countries (ILO, 2008). The background and characteristics of Romanian emigration reveal that permanent adapted policies are needed, since an unstable political and economic environment can collapse at any time.

Although there was clear evidence that the number of Romanians was rising in host countries, the public debate centered on other issues—for example, Roma problems—while the public authorities thought that people were only leaving temporarily. When creating migration policy, attention must be given to the number of people leaving Romania and the reasons behind their migration. This would make migration more beneficial for both the host countries and origin country.

The exploratory research results are specific to the respondents and cannot be generalized to all potential migrants; the pilot research on a younger sample showed different results, but there were significant association relations with other intensities. Nevertheless, economic and non-economic factors were associated with the intention of permanent or temporary emigration of highly educated group in both cases.

While the cost-benefit analysis generally explained individuals’ decisions to migrate, migration should be more complex—not driven only by income aspects, as we saw in the above example. Their decision to migrate (or not) and the reasons associated suggest that their motivations are far more diverse and do not all depend on wage. Their perception of the future labor market (in the context of a psychological experiment) is important because it might shape their decision of whether or not to emigrate. Romanian authorities should do further research in order to gain representative results about intentions of emigration for every segment of the population, in terms of age, educational background, and other structural criteria.

Today we confront an economic crisis, as well as a social one. If the crisis persists in EU member states, it is possible that some states will use political barriers to select the “best”

26

migrants. If these are shaped by policies for facilitating the integration of migrants into destination countries, they will bring effective results for receiving countries as well as for individuals and origin countries. Romania, the origin country of many migrants, should better know its emigrants. Data about the potential flows, structural composition of potential emigrants, and determinants of Romanians’ intention to emigrate could bring economic and social benefits as well as an adaptive political point of view. Migration of highly educated people is a distinct segment of Romanian migration, and estimations of the real effects this emigration will have on demographic and economic development in Romania and the host countries can only be created within the framework of pertinent and realistic policies. As someone commented in the above study, this group of highly-educated people indicated that securing a work contract before leaving Romania and having connections with people that already live and work abroad are crucial to their integration abroad. Fear of not finding a job abroad that meets their skills also reduced their intention to emigrate. As an option for controlling and benefitting from labor migration of highly educated people, Romania might use programs based on partnering with destination countries for labor contracts, as well as policies oriented to migrants’ age, and educational and professional backgrounds. In the above case, the association relations between intention of emigration and opinions regarding labor market were characterized by high intensity; a precarious labor market might cause people to never return or to not invest their remittances in the origin country, so migration policies would do well to collaborate with the labor market.

As a policy approach, we must also realize that migrants might return home, especially in this turbulent economic environment that encompasses all European Union member states.

In host countries, foreigners are in a less favorable position with regard to their employment status, social benefits, and housing. As part of Europe’s 2020 strategy, the European Council has adopted, as one of its five main targets, the promotion of social inclusion, through “the reduction of poverty, by aiming to lift at least 20 million people out of the risk of poverty or exclusion.” Romania must think that possible return migrants deserve sufficient conditions and social inclusion.

27

In conclusion, it is clear that some countries—and especially Romania—need a better evidence system for international migration, for both demographic and economic reasons.

There is an increasing need for migration policy, labor force market, and social system; otherwise, a weak labor force market, lack of active population, aging, depopulation, and poverty might soon characterize vulnerable states. General statistics studies must to go beyond demographic aspects, and present social and economic implications that can help countries strong policy options.

28

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33

Appendix Table A 1: Intention of temporary emigration for work * International career importance as emigration factor – Cross tabulation International career importance (1 means low importance, 5 very important) 1

2

3

4

5

Total

Intention of

improbability

12

5

5

6

5

33

temporary

low probability

42

12

5

5

5

69

emigration for

high probability

21

8

7

5

5

46

work

highest

18

8

6

21

55

108

93

33

23

37

70

256

probability Total

Source: Author’s calculations using SPSS Table A 2: Chi-Square Tests for relation 1 Asymp. Sig. Value

df

(2-sided)

Pearson Chi-Square 77.105a 12

.000

Likelihood Ratio

79.798 12

.000

Linear-by-Linear

41.857 1

.000

Association N of Valid Cases

256

a. 4 cells (20.0%) have expected count less than 5. The minimum expected count is 2.96. b. For decision testing, value of Chi-Square for df=12 and p=0.05 is 21.03, for p=0.025 is 23.3, for p=0.01 is 26.22.

Source: Author’s calculations using SPSS

34

Table A 3: Intention of temporary emigration for work * A greater income from abroad job - Cross tabulation Importance of greater income from abroad job 1

2

3

4

5

Total

Intention of

improbability

1

5

3

8

16

33

temporary

low probability

1

7

25

10

26

69

emigration

high probability

2

8

12

6

18

46

for work

highest

14

46

26

12

10

108

18

66

66

36

70

256

probability Total

Source: Author’s calculations using SPSS Table A 4: Chi-Square Tests for relation 2 Asymp. Sig. Value

df

(2-sided)

Pearson Chi-Square

63.871a 12

.000

Likelihood Ratio

68.369

12

.000

Linear-by-Linear

45.185

1

.000

Association N of Valid Cases

256

a. 4 cells (20.0%) have expected count less than 5. The minimum expected count is 2.32. b. For decision testing, Chi-Square for df=12 and p=0.05 is 21.03, for p=0.025 is 23.3, for p=0.01 is 26.22.

Source: Author’s calculations using SPSS

35

Table A 5: Intention for permanent migration * Importance of difficulty in finding a job abroad according to their skills - Cross tabulation Importance of difficulty in finding a job abroad according to their skills Emigration

Yes, for

intention

sure No, for

1

2

3

4

5

Total

50

2

4

6

16

78

5

1

10

46

52

114

16

4

6

16

22

64

71

7

20

68

90

256

sure Possible Total

Source: Author’s calculations using SPSS Table A 6: Chi-Square Tests for relation 3 Asymp.

Sig. (2Value

df

sided)

Pearson Chi-Square 92.161a 8

.000

Likelihood Ratio

97.745 8

.000

Linear-by-Linear

23.145 1

.000

Association N of Valid Cases

256

a. 3 cells (20.0%) have expected count less than 5. The minimum expected count is 1.75. b. For decision testing, Chi-Square for df=8 and p=0.05 is 15.51, for p=0.025 is 17.53, for p=0.01 is 20.09. low probability

Opinion 22 5Yes, about labor 19 market capacity 13 10 to

69

Total hire emigration all persons with university No, for high probability 4for 5 7Indifferenc 12degree 18 Table A 7: Intention of temporary for work * Opinion about46 labor suretabulation No highest 5sure with6Yes 5e 78 108 market capacity to hire all persons university degree 14 - Cross Intention of probability improbability

5

10

8

5

5

33

temporary emigration for work

36

Total

19

43

39

44 111

256

So urc

Source: Author’s calculations using SPSS

e: Author’s calculations using SPSS

Table A 8: Chi-Square Tests for relation 4 Asymp.

Sig. (2Value Pearson Chi-Square

df

86.187 12

sided) .000

a

Likelihood Ratio

90.529 12

.000

Linear-by-Linear

58.619 1

.000

Association N of Valid Cases

Source: Author’s calculations using 256

SPSS

a. 2 cells (10.0%) have expected count less than 5. The minimum expected count is 2.45. b. For decision testing, Chi-Square for df=12 and p=0.05 is 21.03, for p=0.025 is 23.3, for p=0.01 is 26.22.

37

Table A 9: Intention of temporary emigration for work * Opinion about the fact that low incomes determine working abroad - Cross tabulation Opinion about the fact that low incomes determine working abroad Yes, for

Indifferen

sure

Yes

ce

No

Total

Intention of

improbability

8

7

8

10

33

temporary

low probability

30

24

12

3

69

emigration for

high probability

26

8

4

8

46

work

highest

65

19

10

14

108

129

58

34

35

256

probability Total

Source: Author’s calculations using SPSS Table A 10: Chi-Square Tests for relation 5 Asymp.

Sig. (2Value

df a

sided)

Pearson Chi-Square

31.301 9

.000

Likelihood Ratio

31.212 9

.000

Linear-by-Linear

9.206

.002

1

Association N of Valid Cases

256

a. 2 cells (12.5%) have expected count less than 5. The minimum expected count is 4.38. b. For decision testing, Chi-Square for df=12 and p=0.05 is 16.92, for p=0.025 is 19.02, for p=0.01 is 21.67.

Source: Author’s calculations using SPSS

38