Barriers to labour market integration of migrant workers

Recent studies examining the labour market impact of immigrants in Ireland highlight the possible existence of barriers to the job mobility and integration of migrant workers. Obstacles include non-recognition of qualifications and an occupational gap in the sense that immigrants are, on average, less likely to work in high-level, high-status occupations relative to Irish nationals. Some non-EU migrants are being displaced by migrants from the new EU Member States.

Ireland’s Economic and Social Research Institute (ESRI) has recently published a number of research reports on the impact of labour market migration in Ireland, notably in terms of the extent to which Ireland’s immigrants are integrating into its labour market.

Lower occupational attainment

One ESRI study, published in June 2007, entitled Are Ireland’s immigrants integrating into its labour market?, concludes that the occupational attainment of Ireland’s immigrants relative to natives – controlling for age and education – is lower for more recent arrivals. This is deemed to be related to changes in the national composition of the immigrant inflow into Ireland:

Immigrants from the EU’s new Member States (NMS) are heavily represented among the most recent arrivals and they suffer the largest occupational gap [in terms of their occupational attainment relative to native Irish, with immigrants, on average, less likely to be in high-level occupations, such as the professions]. In addition, there appears to be no lessening over time in the occupational gap experienced by immigrants from the NMS.

Accordingly, the authors did not find evidence of immigrant labour market integration over time, in the sense of significant numbers of immigrants moving up the ladder into higher status occupations.

Lower educational attainment

The report’s authors point to the fact that immigrants from the NMS have the lowest level of educational attainment, as measured by the proportion with third-level degrees. As the report concludes: ‘This implies that the changing national mix is contributing to a reduced educational attainment for the newest arrivals in Ireland and also a lower occupational attainment, controlling for education.’

Nonetheless, with respect to educational qualifications, it is noted that the overall proportion of immigrants with third-level qualifications, at 31.8%, is identical to the proportion with third-level qualifications in the native Irish population. For this reason, the report argues that it should not be concluded that immigration into Ireland is becoming increasingly low skilled. Instead, ‘the more modest conclusion’ drawn is that the generally exceptionally high-skilled nature of earlier waves of immigration is being weakened as a result of increased lower-skilled immigration from the NMS.

Reasons for lack of integration

According to the authors, ‘these findings with respect to education and occupational attainment might be of more limited concern if evidence of increased integration over time was found but this is generally not the case.’ The report considers it somewhat surprising that a greater degree of upward job mobility was not found, given that 10 of the NMS acceded to the EU some three years ago, in May 2004. The authors suggest that it is possible that immigrants who arrived before 2004 were working illegally and that a ‘scarring effect’ has arisen, whereby it is difficult to break out of a weak labour market situation. The report adds that ‘other possible explanations for the lack of integration include language skills and the non-recognition of qualifications. It could also be that the timeframe is simply too short for integration to be observed.’

However, the report suggests that whether the lack of labour market integration of migrants is short term or long term, it is not yet possible to gain a clear sense of what might be causing this problem. The authors emphasise the importance of highlighting the existence of barriers to mobility in Ireland so that any such barriers can be lowered, thereby allowing Ireland to avoid the difficulties experienced by other countries in terms of immigrant integration.

Displacement effect

A second, joint ESRI/UK study, entitled EU enlargement and migration: Assessing the macroeconomic impacts, concludes that displacement by workers from the 10 NMS which joined the EU in 2004 is likely to have affected other migrants from non-EU countries to some extent. In relation to this, the report notes that the authorities in Ireland changed policy on issuing work permits to people from non-EU countries as a result of the influx from the NMS. At the same time, while immigration from outside the EU declined by a small amount after enlargement, this reduction was less than the increase in immigration from the NMS.

The authors note that unemployment in Ireland has remained low in the face of ‘very large migration flows’, adding:

The fact that unemployment probably did not change much, while wages did, could be either because of exceptional labour market flexibility, or because the immigrants from the NMS just displaced immigrants from other locations, such that the immigration at an aggregate level was anticipated.

Clearly, continually high levels of economic growth create the conditions for sustained labour market demand, which has benefited, in particular, immigrants from the NMS, given their status advantage over non-EU immigrants: the latter require a work permit, whereas EU citizens do not.

Tony Dobbins, IRN Publishing