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Managers’ Trends Report#1 - September 2017

Managers’ Trends Report Labour markets, employment, business & social dialogue

#1 - September 2017 second versionevery 6 weeks

for CEC members only

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Managers’ Trends Report#1 - September 2017

Glossary

CEPS: Centre for Economic Policy Studies (think tank) CESI: European Confederation of Independent Trade Unions EU-OSHA: European Agency for Safety and Health at Work EC: European Commission ECB: European Central Bank ECHR: European Court of Human Rights EESC: European Economic and Social Committee ETUC: European Trade Union Confederation EURES: European Job Mobility Portal FECCIA: European Federation of Managers in the Chemical Industry GDP: Gross Domestic Product Grandes écoles: selective French higher education insitutions outside the university system ILO: International Labour Organisation OECD: Organisation for Economic Co-operation and Development OHS: Occupational Health and Safety

Content

News CEC event reports ...3 Policy and legal ...4 Politics ...4 Industry ...6 Recent publications ...7 Focus Labour market reforms in France ...8 Young adult mobility in Europe ...11

CEC European Managers September 2017 info@cec-managers.org Rue de la Loi 81a, 1040 Brussels Published: 27.09.2017

Disclaimer: CEC European Managers cannot guarantee for the accuracy of the information provided.

Legend

Source reference links are underlined in black Further information links are underlined in orange

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Managers’ Trends Report#1 - September 2017

■ > Against that background, employers, public services, social partners and others will be able to propose digital internships within the digital opportunity framework. The framework includes recruitment procedures (in liaison with universities) and an “erasmusintern” candidate platform. > Read more

■ Bruegel Annual Meeting Conference, Brussels, 7-8.09 Bruegel (think tank) The annual high-level conference, organised by the economic think tank Bruegel, offered debates about key issues in European and global economics. During the “future of industry” session, Lowri Ewans, Director General of DG GROWTH, called for a “real” single market for services and a European procurement market; said that the EU’s main competitors are from unregulated markets; that data protection was an export of jobs and that a horizontal approach is needed for industry innovation (e.g. knowledge clouds). During the session on “structural determinants of inequalities”, Commissioner Thyssen (Employment and Social Affairs) called for better labour market coordination and cohesion policies in Europe; said that the European Pillar of Social Rights was of guidance for all member states and that workers may acquire social rights through social partner agreements, member state legislation and benchmarks; that Member States should envolve social partners more before making labour market reforms; called for increasing capacity building for social partners; for granting them more impact in the European semester and for or a European budget for the social dimension aiming at harmonising and reducing inequalities. However, social dialogue traditions, such as co-determination, should not be imposed on countries. Reiner Hoffmann, President of the German DGB trade union, criticised the “explosion of the low-wage sector due to deregulation” in Germany, European downward tax competition, as well as EU company law threatening workers rights.

CEC event reports ■ The Future of Work - Making it E-asy

Conference, Tallinn, 13-14.09 Estonian Presidency The event was one of the several conferences organised by the Estonian Presidency of the European Union to debate about issues of relevance for the EU policy-making agenda. The high-level conference, attended by around 300 participants, mainly government and business representatives, comprised discussions about employment trends, the prevalence of new forms of employment over “traditional” ones, the modernisaton of the welfare state and skills. The meeting, also attended by BusinessEurope, ETUC and CESI representatives, was a good opportunity to increase CEC’s visibility towards stakeholders with little knowledge about the European social dialogue. At the two-day conference, some national best practices in an effort to become “E-champions” were presented (Finland and Estonia in particular). The majority of speakers shared the idea that European social systems need to cover everyone, irrespective of the job. Iarla Flynn, Head of Public Policy and Government Affairs of Google Australia underlined managers’ pivotal role in making things change and preparing for the future, as “they represent the single most important driver for the wellbeing and professional satisfaction within a team.” > Read more

■ Digital opportunity initiative workshop, European Commission, 22.09 Digital opportunity schemes will be introduced in the framework of the Erasmus+ programme. The schemes, based on the pilot project with the same name, will provide students of all disciplines grants for digital cross-border traineeships as of January 2018. 37% of the EU labour force does not have any basic digital skills.

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Managers’ Trends Report#1 - September 2017

■ Companies including Google, Facebook and Twitter could face European Union laws forcing them to be more proactive in removing illegal online content if they do not do more to police what is available on the Internet. However, the liability exemption would not be affected, the European Commission said. > Read more

Politics

■ Juncker’s state of the union speech on 13.09: the European Commission president called, among others, for: A European Social Standards Union, a European Labour Authority, a Member States agreement on the European Pillar of Social Rights, no Eurozone chamber of budget, fairer trade agreements, a new industrial strategy, a defense union, unifying Commission and Council presidency, transnational European Parliament lists, Romania and Bulgaria “immediately” joining Schengen and other Member States joining the EU. Positions: ETUC said it was “too light” especially regarding the reference to social rights and regretted that the European semester would not become an economic and social semester. BusinessEurope published its own scenario, warning that the social dimension should not be extended further. > Read more

■ Ireland and its tax regime: following Comission President Juncker’s proposal on introducing majority vote on EU tax legislation (especially applying to digital companies - Ireland had not asked Apple to pay back taxes of 13bn Euros as claimed by the European Commission) to counter downward tax competition, Ireland refused to change voting rights on corporation tax. The island state could lose up to €4 billion worth of corporation tax if EU-wide tax rules for multinationals were set.

Policy and Legal ■ Posted workers: Announed in its political

guidelines and confirmed in its 2016 work programme (COM(2015) 610 final), the European Commission proposed a revision of the rules on posting of workers. Rules for stricter regulations under the slogan of “same pay for same work” have been prominently supported by France. The new French president Macron has been seeking support and dialogue with sending countries in Eastern Europe. However, countries like Poland remain particularly opposed to such changes, fearing decreasing freedom to propose services in the single market.

■ Working time precisions: The UK Employment Appeal Tribunal has ruled that, under the EU Working Time Directive, voluntary overtime pay, out of hours standby payments and call-out payments should be included in the calculation of the 4 weeks statutory holiday pay, provided they are sufficiently regular or recurring. > Read more

■ ECB monetary policy will remain loose, maintaining the historic low of interest rates, while leaving the timing and scope of the bond-buying programme phase-out open. > Read more

■ The European Court of Human Rights (ECHR) has ruled that employers will now need to inform workers before they monitor their communications at work. The decision overrules a previous judgement which had effectively given employers the right to privately monitor the activities of their employees on company messaging systems. > Read more

■ A financial scheme of 120 million Euros for local wireless access points in the EU, free of charge and without discriminatory conditions, has been approved by the European Parliament.

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■ > Here are the main political parties’ positions (and their election results) on the EU and foreign policy: CDU/CSU (conservatives, 33%): stabilise EU; no common debts; for strong economic ties with UK; new trade agreements SPD (social democrats, 20,5%): calls for more European cohesion and solidarity; European constitution; increase power of European Parliament; reduction of European Member States’ debt; a European economic government; avoid arms race Die Linke (left, 9,2%): fight EU isolation and arms race; calls for EU constitution; more solidarity; disintegration of EU capital markets; Greek debt relief B’90/Die Grünen (greens, 8,9%): calls for peace-oriented Europe; harmonisation of wages for same work in EU; increase power of European Parliament; criticise violation of international law FDP (liberals, 10,7%): calls for more reforms and transparency; increase power of European Parliament; a common foreign minister; common defense union; more trade agreements AfD (right-wing radicals, 12,6%): anti-EU and anti-immigration Read more about the > parties’ EU stance here and on > EU and forgeign policy (in German) here

Politics ■ > The current corporation tax is 12.5% for

trading income and 25% for non-trading income - lower than in other EU Member States. > Read more

■ Brexit Employment: 1,2 million UK citizens live in other EU Member States, whereas 3,16 million EU citizens live in the UK. 88% of the EU residents would not be able to qualify for VISA in case of a hard Brexit. The financial sector may lose up to 100.000 jobs to financial hubs like Paris, Dublin or Frankfurt. A controversial Deutsche Bank report warned that the Brexit immigration curbs would rather lead to jobs going offshore and higher automation rates, rather than higher wages hoped for by some actors. One third of non-British workers are considering leaving the UK, with highly skilled workers from the EU most likely to go (47%), according to a June study from Deloitte. A leaked UK Home Office document states that Britain will end the free movement of labour immediately after Brexit and introduce restrictions to deter all but highly-skilled EU workers. Negotiations: While the question on the Brexit divorce bill remains open, discussions around the membership in the single market continue with seemingly little results. Countering the accredited hard-Brexit strategy of the Tories (and German industry preparing for it too), Labour-leader Corbyn said he would seek to remain in the single market.

■ German elections: After the legislative elections on 24 September, a “Jamaica coalition” (CDU/CSU, FDP, Greens) or another “grand coalition” (CDU/CSU, SPD) seem to be the most likely government constellations. Depending on the coalition agreement, different scenarios are likely to influence the future of Europe.

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Managers’ Trends Report#1 - September 2017

■ Uber: after accusations of “modern slavery” and protests, the French division of the driving service platform intends to improve relationships with its “partners”, the drivers. Measures include a zero percent loan for drivers wanting to buy a car and a free accident insurance coverage. > More in French The legal situation of Uber in Europe often still remains unclear, although the European Court of Justice advocate-general’s has issued a non-binding opinion (in May), often followed by other courts, considering it a service company in the transport sector. At national level, Uber has been banned in Bulgaria, Denmark and Hungary and has won an appeal against a ban in Italy. Uber has also faced suspensions in Finland, Spain, France, Germany and the Netherlands, primarily over its UberPOP service. > Read more. > More about how the platform economy shapes industrial relations > More about legal regulation of the platform economy

■ Solar industry: after an EU agreement to set minimum import duties (“anti-dumping”) for Chinese solar modules and cells that could price them up to 30% above market, the solar industry has condemned this move as having “huge negative effects” for the industry. > Read more

■ The German industry federation has criticised Germany’s permanent and large trade surplus. > Read more (German)

■ Artificial intelligence: Tesla and SpaceX CEO Elon Musk voiced concern over governments, especically the Russian one, competing for artificial intelligence superiority and sparking World War III. > Read more SpaceX has already supplied the ISS and plans commercial space explorations. Tesla will launch a new electric lorry, to be tested in October.

Industry ■ Diesel emissions: The diesel-affair involving

many German and international diesel car producers (timeline here) has led to a drop of diesel car sales. Their market share has fallen (2016-2017) from 50% to 43,7% in the UK; 45% to 37,7% in Germany and to 47,8% in France. Several countries have announced to either ban diesel and petrol vehicles in the future (the UK and France in 2040), to require zero-emission vehicles (Norway 2025) or to impose electric car quotas (India 100% in 2030). Austria, Denmark, Ireland, Japan, the Netherlands, Portugal, Korea and Spain have also set official targets for electric car sales. Globally, 95% of electric cars are sold in only 10 countries: China, the U.S., Japan, Canada, Norway, the U.K., France, Germany, the Netherlands and Sweden. The world’s biggest vehicle market, China, is considering a ban on the production and sale of fossil fuel cars “in the near future”. At European level, last April, the European Parliament submitted recommendations to the Commission and member states for tightened regulations and greater oversight of car emissions levels.

■ Ryanair: the European Court of Justice has ruled that air crews, as the weaker party in employment disputes, can bring proceedings before courts in the place where they perform their duties or where they regard as being closest to their interests. > Read more

■ The European Commission has opened an investigation to assess the proposed acquisition of Monsanto by Bayer under the EU Merger Regulation. The instiution has concerns that the merger may reduce competition in areas such as pesticides, seeds and traits. An approval would create the worlds largest agribusiness corporation. Read more

■ A new 50:50 joint venture of ThyssenKrupp and Tata Steel could create Europe’s second largest steel business behind ArcelorMittal, potentially saving 8000 jobs in the UK. > Read more

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Managers’ Trends Report#1 - September 2017

Publications ■ The Going Digital: The Future of Work

for Women OECD policy brief shows that women may benefit from increased flexibility in work but the unscrupulous use of new atypical work arrangements may also reduce job quality. However, flexible working arrangements are shown to reduce gender pay gaps and increase women employment rates. Click here

■ The Taxation Trends in the European Union report responds to the need for better European data about taxation revenues, tax structures and reforms over recent years. 22 Member States recorded an increase in tax revenue relative to GDP in 2015 compared with 2014, while 6 saw a decrease. The level of taxation in the EU differs greatly according to the Member State, with Denmark, France and Belgium having the highest ratio of tax revenue to GDP (46.6 %, 45.9 % and 45.1 % respectively), and Ireland (23.9 %), Romania (28.0 %) and Bulgaria (29.0 % of GDP) the lowest. Click here

■ The EESC/CEPS study “impact of digitalisation and the on-demand economy on labour markets and the consequences for employment and industrial relations” concludes that the labour market of the future will look for workers with digital and entrepreneurial skills and creativity. As a result of digitalisation, work organisation is characterised by increased flexibility, affecting when, where and how tasks are performed. Click here

Recent publications

■ The World Employment and Social Outlook 2017 (ILO) provides figures and analysis on women in the labour market, including the economic impact that could be made by closing gender gaps. It shows that the more women earn, the less they earn compared to men who do the same job. Click here

■ According to the European Agency for Safety and Health at Work (EU-OSHA) together with the ILO, work-related ill-health and injury are costing the European Union 3.3 % of its GDP. That’s €476 billion every year which could be saved with the right occupational safety and health strategies, policies and practices. Further findings: Work-related illnesses account for 89% % of all deaths related to work in the EU. 7.1 million DALY (disability-adjusted life years) are lost in the EU as a result of work-related injury and illness. Of these, 3.4 million are accounted for by fatalities and 3.7 million by disability. In most European countries, work-related cancer accounts for the majority of costs (€119.5 billion or 0.81% of the EU’s GDP), with musculoskeletal disorders being the second largest contributor. Click here

■ Eurofound’s Developments in working time 2015-2016 report takes a closer look onto recent trends in EU member states regarding work–life balance and flexible working arrangements. The difference in working time between workers in the 28 EU Member States remains large and is especially marked between the ‘older’ 15 EU Member States and the 13 new Member States that joined the EU since 2004. This is particularly apparent when comparing annual leave entitlements for workers: a gap of 2.5 working weeks is evident between the most and the least generous. The trend of converging working time between the 28 EU Member States has clearly stalled. Click here

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Managers’ Trends Report#1 - September 2017

French labour market reformsThe recent French labour market reforms, launched by labour minister Muriel Pénicaud under the Macron presidency, are the last example of a series of attempts to reorganise the world of work in France. This time, the proposed reforms, adopted by the council of ministers on 22 September, go further than any other previous attempts, including the 2016 El Khomri reforms.

On the following pages, you will find a summary of the key provisions of the 2016 and 2017 reforms.

1. El Khomri reform 2016

■ Working time: maximum stays at 48h / week and 44h in average over 12 weeks. New: possibility to derogate within limit of 46h through company agreement

■ Exceptional working time and salary flexibility: 1. possibility to reduce working time and salary for max. 5 years, if the company is in economic difficulty with agreement of trade union delegates (délégués syndicaux) 2. Increase of working time for max. 2 years to fit “growth path”. Possibility of dismissing employees refusing to increase working time for economic reasons

■ Overtime: Normally employees get paid 25% more / h for the first 8h and 50% for the following hours. A company agreement can now decide to reduce it to 10%.

■ Economic dismissal now possible, if the company orders or sales revenues shrink consecutively (1-4 trimesters, depending on company size)

■ Forfaits jours (daily working allowance): certain categories of workers (especially managers / cadres) are exempted of the weekly 35h working time, foreseeing 11h of daily rest and 24 consecutive hours of rest per week. The forfait jour has to be adopted by a collective agreement and a pay agreement of the employee. New: collective agreement needs to include health and safety provision (e.g. right to disconnection, WLB, work time load, communication)

■ Company agreement validity: company agreements are only valid, if they are signed by trade union representatives representing at least 50% of the workforce. Company referendum possible, if trade union represents at least 30% of the employees and collects at least 50% of the employees’ votes. Trade unions lose their right to oppose these referendums.

■ Labour law infringement compensation (was not in vigour): non-obligatory scale for labour courts to apply compensations fixed by law, according to seniority and other criteria

French President Emmanuel Macron. Credit: French Embassy in the U.S.

Focus

Myriam El-Khomri was labour minister under Hollande

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Managers’ Trends Report#1 - September 2017

■ Obligatory medical visit at hiring does not apply to all categories of employees anymore

■ Youth: vacation day allowances can now be calculated on a monthly basis in the first year; Youth guarantee extended to whole territory: it comprises the right for 18-25 year olds to get job seeking assistance and an allowance

■ Personal activity accounts: unique information system for access to rights in terms of training, burdensome work (e.g. early retirement) and voluntary work (e.g. right to days off for training)

■ Right to disconnect: right to not be available through communication channels; regulation decided by company agreement

■ Electronic pay slips: employers are allowed to issue pay slips electronically, employees have the right to require a paper form

2. Pénicaud reforms 2017

■ Increase the applicability of company agreements: the branches will be able to negotiate fixed-term contracts and project contracts, and conserve some domains (wage minimums, professional classifications, complementary social protection, training, burdensome work and professional equality) in which company agreements cannot derogate the branch agreement, unless decided by branch agreement; introduction of possibility for collective contract breaches

■ Flexibility: application of construction site contracts (limited to project duration) to other sectors in the form of project contracts; introduction of possibility for branch agreements to define modalities of fixed-term contracts

■ Social dialogue: 1. unification of three employee representation bodies: unification of employee committee, personnel delegates and OHS council into social and economic committee (companies with more than 50 employees) and maintenance of trade union delegates. Social and economic committee will be able to negotiate agreements in companies without trade union delegate and has a veto right on issues regarding VET and gender equality. Company agreement can decide upon maintaining bodies or creating new ones. The number of representatives and their working time will be subject to a future decree (are likely to shrink). A new hygiene, security and working conditions commission will be obligatory for risk-affected companies and companies with more than 300 employees. 2. Negotiation at company-level without trade union delegates: introduction of possibility to negotiate (and agree with majority vote) with elected employee representative all non-sectorial issues in companies without trade union delegation and with 20-50 employees (companies with less than 20 employees don’t need to elect employee representative to negotiate). Alternatively, a “referendum” can be initiated by a trade union receiving at least 30% of the employees’ votes or by a “referendum” organised by the employer on working time and organisational issues (companies with less than 50 employees). 3. Increasing trade union representation at company level: digital trade union and labour rights information system; collective negotiation observatory; university and “grandes écoles” cooperations to train trade union activists

Muriel Pénicaud is labour minister under Macron

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Managers’ Trends Report#1 - September 2017

■ Dismissals: Dismissal compensation limitation (indemnité prud’homales) for cases without “serious and real reasons”; shortening of appeal period; increase of legal dismissal compensation; facilitating economic dismissal by extending criteria (sectoral, geographical); shortening dismissal period for employers; dismissals due to individual refusal of collective agreement will lead to lower compensation rights (but 100 hours of training allowance on personal account) by excluding these individuals from social restructuring compensation rights; increase of legal dismissal allowances (from 1/5 to 1/4 of monthly salary per year of seniority)

Unemployment benefits reform planned for summer 2018

■ In April 2017, social partners had agreed on a new unemployment insurance convention, including: the harmonisation of unemployment benefits of general regime and regime for interim workers and short-term workers; to benefit from unemployment allowance, workers will now have to have worked at least 88 working days (instead of 122 calendar days before)

■ President Macron proposed to reform the unemployment benefit system more extensively: a universalisation of coverage to independents & liberal professions; right to benefits in case of resignation (once every 5 years); more controls and introduction of sanctions for workers who refuse job offer; increase social contribution on salaries while removing the unemployment insurance contributions on salaries

Sources ■ http://droit-finances.commentcamarche.net/faq/62011-macron-et-

assurance-chomage-le-projet-macron

■ http://droit-finances.commentcamarche.net/download/telecharger-429-loi-habilitation-macron-2017-texte-du-projet-de-loi

■ http://droit-finances.commentcamarche.net/faq/61943-reforme-du-code-du-travail-2017-reforme-macron

■ http://droit-finances.commentcamarche.net/faq/52536-loi-el-khomri-loi-travail-ce-qui-a-change

Reform timeline

3 May 2016: Presentation of the El Khomri Law in the Assemblée Nationale (AN) by the Valls government using article 49-3 of the constitution (article allowing the government to pass a law without vote in the AN, if no censure motion is put in place)

12 May 2016: Censure motion of the right rejected28 June 2016: Redesigned El Khomri law voted by Senate6 July 2016: The Council of Ministers adopts the second version of the text using article 49-318 and 20 July 2016: Senate reexamination and AN final lecture21 July 2016: The definitive version of the El Khomri law is adopted by the Council of Ministers using article 49-39 August 2016: publication of the law in the official journalMid June – end of July 2017: new labour reform concertation with social partners1 and 2 August 2017: habilitation law passed by AN and Senate giving the government the right to regulate labour rights via decrees Vote in favour: LR, LRM, RDSE (centre – right); Vote against: PS, EELV, PC (centre-left, green, left)

22 August 2017: concertation with social partners; presentation of points agreed upon31 August 2017: publication of labour law decrees reforming labour lawsUntil mid-September 2017: last consultations12 September 2017: general mobilisation of CGT trade union22 September 2017: adoption in council of ministers

■ http://www.lemonde.fr/politique/article/2017/08/22/code-du-travail-la-reforme-entre-dans-sa-phase-finale_5175000_823448.html

■ http://www.lemonde.fr/politique/article/2017/08/31/la-reforme-du-code-du-travail-devoilee-par-le-gouvernement-a-midi_5178820_823448.html

■ http://www.lemonde.fr/politique/article/2017/08/31/droit-du-travail-le-gouvernement-defend-une-reforme-ambitieuse_5179109_823448.

html

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Managers’ Trends Report#1 - September 2017

Young adult mobility in Europe At the occasion of the Mobility and Mentoring Conference on 20-22 September in Lisbon, co-hosted by the CEC chemical federation FECCIA, we take a closer look at young adults’ mobility in Europe. Facilitating young people’s mobility in Europe can be an important contribution to increase European comptetitiveness, to create a sense of belonging to Europe and to promote social and occupational integration. In 2016, around 17 million young adults (20-34 years old) were neither in education nor employment (NEET) in the EU28. An integrated approach to mobility and activation is needed to improve education and stifle investments in human capital, assure the inclusion of the unemployed, mitigate the risk of long-term effects of youth unemployment (“lost generation”) and risks related to health, security, polarisation, and radicalisation. Furthermore, in the absence of monetary adjustments or an economic governance in the Eurozone, labour mobility was hoped to counterbalance asymmetric economic shocs in regions (see more in the 2014 Labour Mobility report of the European Commission). However, labour mobility in Europe remains low, even though young people are starting to change patterns. Here are the main challenges to European labour mobility in general and young adult mobility in particular:

■ Language proficiency: despite progresses in English, foreign language proficiency varies widely in Europe (Commission target: 2 foreign languages per person)

■ Company engagement: significant variation in the commitment of European firms to skill formation and the offer of good quality working conditions, which are ultimately associated with significantly fewer skill bottlenecks on the labour market. Companies face difficulties in recruiting workers from other member states due to a lack of integration of unemployment services (EURES, the European Job Mobility Portal, is an exception).

Focus

■ Labour mobility in the EU remains low in terms of (figure 1): a) the share of EU citizens living in another EU country and b) the annual flow of EU citizens moving into another EU country. However, in total, young people (and those with higher education) remain the most mobile age group of intra-EU migrants : in 2010, the -35year group accounted for 70% of the total intra-EU migrant population

■ The “social trilemma”: if more economic and social convergence (e.g. a service single market) is to be achieved, then a more European social policy approach is needed > Read more (p.10)

■ Taxation and pensions: often covered by bilateral agreements between Member States

■ Social dialogue integration: challenge to social partners, and especially labour unions (but also cross-border employers), in their efforts to organise mobile workers: they are sometimes unskilled in dealing with language and cultural differences; and sometimes have protectionist attitudes

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Impact of mobility

■ Impact of crisis on intra-EU mobility: Mobility increased from several of the countries that were most affected by the crisis, such as Greece, Spain, Portugal, Italy, Ireland and the Baltic countries. Many of these expats - often young people - move to countries and regions with more favourable economic conditions in Europe. For instance, there was a 52% increase in mobility from Spain to Germany between 2010 and 2011, and a 90% increase in inflows from Greece. However, the capacity of Member States to manage or regulate the freedom of movement in the EU is limited. Thus, labour mobility within the EU is mainly driven by the demand-side and supply-side. But employers do not always take their responsibilities, for instance, ensuring adequate housing for seasonal workers. Therefore, cooperation of local governments with employers is of crucial importance, e.g. for ensuring decent housing and working conditions.

■ Impact of youth mobility: the young and higher educated people are more prone to mobility, both rural-urban and crossing borders. They benefit more from the advantages of cities and migration. This reinforces the trend of accumulation of the elderly, lower educated and less endowed in shrinking, rural or peripheral regions. Such regional disparities deserve attention from local and national governments

■ Impact on host countries: While immigration might have a positive impact on national level, it might affect some groups negatively: the so called distributional effect (e.g. labour market competition). Supply of cheap foreign labour may cause employers to refrain from investing in training of native workers or in innovation and improving working conditions

■ Impact on sending countries: The potential detrimental impact on sending countries is that they are losing part of their working-age population. On the one hand, remittances can bring extra capital, and outflows can alleviate unemployment. On the other hand, the loss of skilled workers (‘brain drain’) and loss of workers – and the resulting acute labour shortages in certain sectors - can harm economic growth Source: Youth unemployment and geographic mobility in the EU. Background Paper. Irish presidency of the Council of the European Union 2013.

Figure (left) Stays abroad for education or training Considerable differences between Member States (Youth on the Move, 2011, p.24)