The Incredible Shrinking Continent

By Theil, Stefan | Newsweek, March 1, 2010 | Go to article overview

The Incredible Shrinking Continent


Theil, Stefan, Newsweek


Byline: Stefan Theil

Europe is on track to lose 52 million workers between now and 2050--unless it begins embracing immigrants fast.

You'd never guess it from the rants of America's talk-radio Jeremiahs, but U.S. immigration policy isn't really a disaster. In fact, Europe has recently begun studying it enviously--or was studying it anyway. Then the recession struck. Now it's open season on foreigners across much of the continent. Italy's interior minister, a member of the xenophobic Northern League, has sent armed carabinieri to clear out camps of jobless migrants in Naples and other parts of the south. In Britain, Tory leader David Cameron recently promised that if his party wins upcoming elections he'll slash immigration by 75 percent--and that's on top of the visa quotas imposed last year by the current Labour government. Ahead of key regional elections in France, President Nicolas Sarkozy has launched a noisy debate about "French identity." Switzerland has outlawed minarets, and France, not to be outdone, is considering a ban on burqas.

As bad as the surge of intolerance is for the foreigners who are its targets, it's a disaster for Europe. The continent is heading for serious long-term economic trouble unless it learns to manage immigration intelligently. Deaths are expected to outnumber births this year in 10 of the European Union's 27 member states. As of 2015 the EU as a whole will experience negative natural population growth, demographers say, and the gap will grow to 1 million excess deaths a year by 2035. By 2050 the EU will have 52 million fewer people of working age, the European Commission warns. Businesses across Europe are already facing severe shortages of engineers, technicians, craftspeople, and other skilled professionals, with 4 million unfilled jobs across the continent. "Every one of our clients in Europe has positions they can't fill because of continentwide shortages," says Barbara Beck, European head of the employment service Manpower. And the problem will only worsen as the job market recovers.

The trouble isn't a shortage of immigrants. The European Union has attracted 26 million migrants in the past two decades--a full 30 percent more than America's 20 million over the same span. But most European countries tried to protect homegrown labor by shutting out foreign workers. The efforts mostly backfired, encouraging a massive influx of illegal aliens, who tend to accept rock-bottom wages and benefits because they have no legal recourse. At the same time, Europe's generous social benefits encouraged a massive surge of "welfare tourism." As a result, Europe has ended up with 85 percent of all unskilled migrants to the developed countries but only 5 percent of the highly skilled. Compare that with the United States, which has honed its innovative edge by attracting 55 percent of the world's educated migrants. And because immigration happens largely via networks, with established immigrants paving the way for their peers, such trends tend to endure. "It therefore takes decades to turn immigration policy around," says Thomas Liebig, a migration specialist at the Organization for Economic Cooperation and Development (OECD).

For decades most European countries have consigned immigrants to the margins: in Germany, some professions were restricted to German citizens well into the 1990s, while eligibility for citizenship itself was based on bloodlines until a landmark reform in 2001. Millions of refugees were legally barred from working, which forced them into squalid welfare dependency. …

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