EU Enlargement and the Limits of Freedom

The enlargement of the European Union on May 1 gave nationals of the 10 new EU Member States the right to move relatively freely around the whole EU territory. The potential consequences of this new freedom have fueled debate in the 15 existing EU states (the so-called EU-15), where many fear that migrants from the new members will swamp their labor markets and strain their welfare systems.

In theory, the nationals of all 10 new Member States are now officially EU citizens with the right to live and work in any Member State. The near-term reality, however, is that domestic outcries have already led 14 of the original EU states (the exception being Sweden) to impose employment or welfare access restrictions on citizens of eight of the new Member States: Estonia, the Czech Republic, Hungary, Latvia, Lithuania, Poland, Slovenia, and the Slovak Republic. Many EU-15 leaders fear that the weaker economies of these Central and Eastern European countries will provide incentives for their citizens to migrate in search of work.

The restrictions are based on transitional arrangements between the EU-15 and the European Commission, under which access to EU-15 welfare systems and labor markets can be regulated by national policies and bilateral agreements between the current and new Member States until at least 2006. The EU-15 cannot impose rules on these nationals that are more restrictive than those applicable before May 1, 2004. While analysts expect such employment restrictions to have little impact on actual migration from these states, these limits do, however, answer domestic political concerns in the context of slowing economies, high unemployment, and anti-immigration sentiment.

In reality, many analysts believe the effect of the enlargement on EU migratory trends will most likely be similar to that of the addition of Greece in 1981 and Spain and Portugal in 1986. Those enlargements prompted only small-scale emigration from the new Member States, despite differences in per-capita income similar to those that exist today between the EU-15 and the new Member States. In the cases of Greece, Spain, and Portugal, emigration continued to be negligible even after the end of similar transition periods that restricted freedom of employment for their citizens. Meanwhile, many of those who did emigrate returned to their country of origin after a few years, when economic opportunities at home became competitive with those available elsewhere in the European Union.

One significant difference between the 1980s and the present, however, is the advent of European Union citizenship and the concomitant rights to freely move to, reside in, and work in all the other Member States as set out in the 1992 Treaty on European Union. The looming question now is, would these rights themselves be sufficient to provoke a much larger proportion of nationals from the countries acceding in 2004 to migrate than was the case in earlier enlargements?

It certainly was not reason enough for Austrians, Finns, and Swedes to move in significant numbers when the EU expanded to take in their countries in 1995. Many analysts suggest that these nationals stayed put because of the relative strength of their own country economies—a strength that contrasts sharply with economic weaknesses in the new Eastern and Central European Member States.

Studies carried out in the seven years leading up to this most recent enlargement show no consensus on migratory projections. Estimates of the number of new EU citizens who will move over a 10-year period as a result of the changes vary between 0.5 million and 6.3 million. Most experts believe that roughly one million people will move: just 0.27 percent of the current total EU population and a number roughly equal to the current Eastern European population in the EU-15. If this estimate is correct, the number of migrants will be much less significant than has been portrayed in much of the media.

Furthermore, analysts cite a lack of language skills, an absence of a natural or proven propensity to migrate, and the fact that there is not much internal mobility in the Central and Eastern European countries as factors that will limit movement into the EU-15 and attempts to find employment there.

Despite these obstacles, two groups are thought more likely to move: the young (aged 18 to 24) and the family members of people who had migrated prior to May 2004, but who previously had no right to family reunification. Migration for family reunification will be allowed in the newly unified EU, but it is thought that these individuals are unlikely to wish to enter the labor force in the short term.

The young, meanwhile, are needed by the EU-15, whose welfare systems face a potential future crisis as their demographics swing towards aging populations. This "youth drain" together with the more familiar "brain drain" may pose special challenges to the new Member States.

During this process, there will be two exceptions to the transition arrangements. First, they do not apply to Cyprus or Malta because of their small size and their relative economic strength. Cypriots and Maltese citizens will be able to take up employment in the EU-15 without any restrictions. In addition, Malta has been granted the right to impose safeguards of its own if it fears large movements of workers from other EU Member States into its economy.

Second, Germany and Austria—which for historical and geographic reasons may be most significantly affected by enlargement—will be able to restrict access to their labor markets to a greater degree than the rest of the EU-15, especially with regard to self-employment, and particularly in the construction sector.

Looking Ahead

According to the transition arrangements, two years after accession, in May 2006, the European Commission will report on the level of migration from the eight new Member States and its impact on the economies and labor markets of the EU-15. At that time, Member States will be able to choose to maintain or eliminate the work-permit requirements and limitations on welfare access.

Three years later, in May 2009, the plan is for the EU-15 to open their labor markets fully. Member States will be allowed to maintain restrictions only if they can prove serious or considerable threats or disturbances in domestic labor markets. Finally, in May 2011– seven years after accession – all Member States will have to allow all EU-25 citizens to move to, reside in, and work freely in their countries.

It is feasible that the transition will run more smoothly and quickly than the seven-year plan laid out, possibly leading to an earlier lifting of employment restrictions.

Ultimately, the EU-15 will have to adjust to the addition of new Member States. The time period in which that happens may become shorter if predictions about limited emigration are correct. At the same time, the imposition of labor and welfare restrictions – counter to the spirit of EU citizenship – demonstrates that domestic concerns still outweigh the impetus to integrate new members fully into one European Union.