Migration and slowdown?

Real economic slowdown and fears of a further downturn are impacting the patterns of international migration and the behaviour of migrants.

• Mexicans living abroad, mostly in the United States, last year sent home $24 billion, only 1% more than in 2006, in a context of double digit rises in recent years. According to the Mexican central bank, remittances have fallen 2.9% year-on-year in the first quarter of this year.

• According to the Institute for Public Policy Research (IPPR), of an estimated million eastern European migrants to the United Kingdom since EU enlargement in 2004, around half have returned home.  UK government data shows that applications to work from the eight eastern European countries that joined the EU in 2004 have declined 13% year-on-year in the first quarter of this year.

These figures reveal broadly similar migratory trends: as economic conditions become more challenging in countries that traditionally receive large numbers of migrants, patterns of migrant behaviour will change.  However, contexts that represent difficulties for migrants in some areas, could present opportunities in others:

• Suffering industries. Economic downturn will particularly hurt large numbers of Mexicans in the United States.  Construction, which traditionally employs many Mexican migrants, has suffered particularly badly from the aftermath of the sub-prime crisis, meaning that migrant employment opportunities are diminishing.  At the same time, Mexicans are migrating to parts of the United States that traditionally have not received large inflows of foreign workers.  Tight restrictions on employment and sending of remittances are also hurting migrant incomes and the flow of money transfers to their relatives back home.
• Repatriation. Eastern European migrants to Western Europe after EU accession have been able to migrate legally, particularly to countries such as the United Kingdom and Ireland, which did not impose employment restrictions.  This has allowed them to increase skills and save money, which is allowing them to return to their countries of origin to take advantage of increasing incomes and employment opportunities, and lower property prices, particularly in the context of a pound that is depreciating against eastern European currencies. 

The proliferation of budget flights, along with EU employment and residence rights, has made Eastern European migrants to Western Europe extremely mobile, often allowing telecommuting.  In contrast, there are signs that rising numbers of Mexican workers are returning home, after having been deported, or having been unable to find gainful employment in the United States.  While returning migrants are positive for Eastern European economies, driving rising income and skill levels, for Mexico they are a sign of economic malaise. The returnees could find themselves increasingly drawn to petty and organised crime, particularly as jobs begin evaporating in the Mexican manufacturing sector as a result of falling US demand.