Page last updated at 14:17 GMT, Friday, 7 August 2009 15:17 UK

Migrants change track to beat recession

By James Melik
Business reporter, BBC World Service

hod carrier on building site
The construction industry worldwide has been badly affected

There is no doubt the current recession will be the worst in a generation and migrants are changing their destinations as a result.

The hike in oil prices in the 1970s and 1980s caused a recession in the industrial world, but created a boom in countries with access to cheap energy - particularly the oil exporting nations.

Subsequently, migrants changed their destinations - just as they are doing in the current financial climate where job losses are most severe in industries that use immigrants, such as construction.

Global picture

Unauthorised migration in north America is most sensitive to the economic cycle, according to Demetrios Papademetriou at the Migration Policy Institute in Washington.

"We haven't been able to measure a significant uptake for 18 months," he says, "and in some countries it has ground to a halt."

Migrants are staying put in the hope that things will turn around and they will be able to get jobs again
Demetrios Papademetriou, Migration Policy Institute

Americans themselves are beginning to move around the country in search of better jobs.

In other parts of the world, evidence shows that unemployment rates among immigrants has skyrocketed.

"Spain already has an unemployment rate of 13-14%, while the unemployment rate for the immigrants is approaching 20%," he notes.

He sees a resistance against going back to their country of origin, however, along with Spain, the Czech Republic and other EU member states are introducing packages to entice people to return.

"They are staying put in the hope that things will turn around and they will be able to get jobs again," he says.

Temporary return

Some countries have more generous social benefits than others and that can often be an incentive to remain.

"If someone has access to unemployment benefit and a decent welfare support system and are there legally, of course they will try to tough it out," Mr Papademetriou believes.

The BBC is Taking the Pulse of the Global Economy, looking at a range of subjects this summer
Consumer behaviour - how have lifestyles changed over the year
Food prices - which remain a concern particularly in many developing economies
Highly volatile energy prices - which have been a major issue in the past year
The plight of migrant workers - as the global recession takes hold in many economies
Housing markets - which have turned from boom to bust in many countries
Rising unemployment levels - as firms cut back because of falling orders

Although migrants who have earned the right through membership in the EU might travel back and forth to see if circumstances are better in the country of their birth, Mr Papademetriou says this tends to be temporary rather than a permanent return.

Even if the economy turns the corner, the employment rate will lag the economic term by several months or more, he explains.

"If the recession becomes deeper, people will have to face a Hobson's choice," he says.

"Do they try to survive through the bad times in a place that doesn't want them, where life even at the margins is very expensive and without a social support system, or do they go back home where at least they will have their loved ones and the few dollars they have will take them a bit further?"

In Europe there was a large migration from Eastern Europe to Western Europe, but now many of those eastern Europeans are moving back because the financial gains are not as good as they were.

Rising tensions

Recession raises all sorts of arguments about immigration, especially when fearful workers think their jobs are threatened by foreigners.

What we have at the moment is governments deciding who will be admitted into the country
Dr Eamonn Butler

Adam Smith Institute

There is a dichotomy whereby political thinkers, generally on the right, advocate the free market yet become protectionist when confronted by a free market in labour.

But Dr Eamonn Butler of the Adam Smith Institute does not believe xenophobia is the prerogative of the right.

"People on the left might welcome world socialism, but when it comes to people coming from other countries and taking their jobs they are not so keen," he says.

He believes that stopping the movement of workers would be counterproductive and that we actually need people to move between nations.

"A lot of countries send labour abroad and it is good for people in poorer countries to go abroad and send money back home," he says.

"The best sort of world is one in which people are free to migrate over the long term," he maintains.

"What we have at the moment is governments deciding who will be admitted into the country.

"They tend to resist inward migration and eventually, at some point when skills are in short supply, they give in so you get a massive surge."

Massive movements are most difficult to deal with and it is hard to convince people that the lower paid worker is a benefit to the country.

"We have to be very careful about a rise in anti-immigrant animus," he warns.

Historical precedent

The greatest period of migration was at the end of the nineteenth century and the early decades of the twentieth when Europe's poor crossed the Atlantic.

Statue of Liberty
The Statue of Liberty symbolised the land of opportunity for migrants

"You had massive migrations to America and Canada caused by the clearances of subsistence farming in Scotland and the Irish potato famine," Dr Butler says.

Ellis Island was the great Mecca of that migration, the holding and processing place on the Hudson River, within sight of Manhattan.

Since 1 January, 1892, when records show that Annie Moore, a 15-year-old girl from County Cork in Ireland, was processed, more than 12 million people went through Ellis Island and remained to make modern America.

The criterion for admission was an economic one: would the immigrant be a payer of taxes or a taker from the public purse?

If the latter, they were marked on the shoulder with a chalk cross and put on the boat back to Europe.

"I joined the Brain Drain from Britain to America in the 1970s when Britain was in a very poor state and America seemed to be a land of enormous riches," Dr Butler reflects.

He however, did not have to undergo the rigors of Ellis Island.

"I arrived at Kennedy on Freddy Laker's Skytrain - the first attempt to break the trans-Atlantic airline cartel and offer cheap flights to Brits," he says.

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