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Jennifer Joan Lee
Don't expect a cushy job bonanza for expats quite yet
The International Herald Tribune , January 24, 2004
Add 10 countries, subtract red tape, multiply business, divide the opportunities. A logical equation in a wider Europe? Well, yes and no. In theory, when the 10 accession countries join the European Union on May 1, one of the world's largest labor markets will be created, and anyone holding an EU passport would have free access.
In reality, however, an EU enlarged through the arrival of the 10 - Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, the Slovak Republic and Slovenia - will not overnight become the free-for-all job fair that many envision. Nor would it necessarily become a hotbed for cushy expatriate assignments. Like so many things, the reasons come down to a balance of politics and economics.
Certainly, the anticipation of enlargement has already fueled growth and employment. The European Commission reports that trade between current and new member states tripled in the last 10 years. Integration into the EU of the 10 new markets - with a combined population of 105 million people - should therefore generate even more jobs on both sides.
This, however, does not mean that French employees can suddenly work in Poland or that Hungarian job seekers can pull up stakes and move to Spain or Germany. In fact, the very fear of such a phenomenon prompted the EU to allow existing member states to limit access to workers from accession countries for up to seven years.
"There is a concern in Western Europe that, because of the wage gap, you would have a flow of workers coming in from new member states into old member states," said Jean-Christophe Filori, the spokesperson for enlargement at the European Commission. "But we don't expect anything massive. This is all political. It has to do with addressing the concerns of public opinion."
This, he said, is why a seven-year transition period for the enlargement is very flexible. "It doesn't say for seven years our labor market is closed. It just says any country can do what it wants for up to seven years." So far, Ireland is the only country that has agreed to fully open its labor market. Britain, Denmark and the Netherlands had earlier agreed to do the same, but have since returned to debating the issue.
All other countries have yet to take an official position, although Sweden, Luxembourg, Finland, Spain and France have suggested that they may apply their own rules with some flexibility during the first two years.
Austria and Germany, which said they would keep existing restrictions in place during the same period, are also back at the drawing board.
A European Commission spokesperson says member states have until the end of January to volunteer their intentions.
Meanwhile, the accession countries could also enforce their own cross-border rules as a tit-for-tat measure against those member states who limit access to their workers. In short, after enlargement, many employees would likely still need work permits to work outside their home countries, although they would be given priority over non-EU nationals such as Americans.
All EU countries are expected to review their positions after two years and again after five years. At the end of the transition period in 2011, however, they must fully open their labor markets.
A similar system, based on similar fears of an influx of poorer laborers, was devised in 1986, when Spain and Portugal joined the EU. Post-accession however, their economies strengthened, encouraging not only their workers to remain, but luring back those who had left. Some believe the same trend will play out again this time.
"I think the brain drain will be toward the accession countries," said Nanette Ripmeester, director of Expertise in Labor Mobility, a Netherlands-based institution that provides knowledge, advice and training on international work issues.
"Probably we'll see more people from the West moving East than the other way around. And we'll also see people returning to their home countries as opportunities there grow."
The free movement of workers within the EU will only apply to EU citizens. In other words, an American working in Paris and wanting to move to Britain, Spain or Poland would still have to go through the national procedures of those countries.
For non-EU nationals, then, the question is not freedom of movement but availability of jobs. What opportunities will there be for expat workers from outside the EU in an enlarged Europe?
Since the beginning of the transition period in 1989, foreign and European corporate investment has been pouring into the top economies of Central Europe, creating a boom in the demand for high-level expatriate workers. As these countries get ready to join the West, however, cash-conscious investors are looking further east, including to Romania and Bulgaria, two countries expected to join the EU in 2007.
"One of the concerns that has been raised, as countries join the EU, is that companies will not be able to sustain lower labor costs," said Simon Dudley of Watson Wyatt Worldwide, an international human capital consultancy.
"So we're seeing movement even further east - to the nonaccession countries. That's where there will be more opportunities. To cut costs down, the attraction is going to be those countries who continue to be outside the EU."
A number of companies are still trying to gain a foothold in Central Europe, though, so expatriate jobs will continue to spring up, particularly in the smaller accession countries, where investment remains nascent.
"For smaller countries that do not have many businesses yet, but will have more later, companies there will be looking for people to help them grow their businesses," said Dudley.
"The other area is the continuing need among large international corporations, who have a presence in the accession countries, to bring in expats to help develop business initially before it moves towards taking on local staff."
Many companies, eager to avoid expensive expat packages, are planning instead to hire local workers who would command lower salaries. Already, many expat jobs have been taken over by educated locals, who have been developing their skills since the breakdown of the Soviet Union.
Yet, for them to work effectively in a multinational corporation, many require training. That's where many expatriate opportunities come up.
"Companies who invest here need outside trainers," said Brendan Burke, executive English editor of the Warsaw Voice, an English-language daily in Poland. "It may not be a permanent posting. They would just train the Polish managers, work here for a few years and then move on. We already have a skilled labor force here."
Ripmeester said she was hearing that large European companies, insecure about the skills of people in the accession countries, would probably begin by hiring people from their own countries. "I think people will have the best chance if they approach companies who plan to move to those countries, or companies who are already there who may have further expansion plans," she said.
The opportunities presented by an enlarging Europe are also being eyed by the thousands of Central and East European workers working illegally in Western Europe. A Polish woman who has worked illegally in Paris for eight years, and who declined to be identified, said, "When I first heard Poland was joining the EU, I was so happy. I thought my life will finally become easier because I will finally get my working papers."
Perhaps not overnight, but certainly by the end of the transition period in 2011. Then, she, and the thousands of other job hunters who have fled to the West, may find themselves returning home.