Austrian Migration Dynamics: From Guestworkers to Immigrants and the Impact on Skilled Labor Market

2. When guestworkers become immigrants • The Austrian migration system differs from traditional immigration countries like Canada, USA and Australia: • It has its origins in the guest worker model, going back to the early 1960s. • The objective was not population growth but rather the satisfaction of perceived temporary labour needs, as Austria lost many native skilled workers to neighbouring Germany and Switzerland as well as immigration countries like Canada, USA, Australia in the 1960s and 1970s. • As Austria was the poor-house of Europe after WWII, it could not attract highly skilled workers, as the wages were too low compared to other host countries. • Until today, Austria is a country of immigration and emigration whereby it is a net-loser of highly skilled

3. Austria is among the countries with the highest immigrant shares in Europe:Foreign born as a proportion of the total population in selected OECD countries: 2001 S.: OECD-SOPEMI.

4. New wave of immigration since late 1990s in Austria S: Statistics Austria.

5. Austria cannot attract large numbers of highly skilled migrants: reliance on further education and training of its residents • The Lisbon agenda introduces a new feature to migration policy via a strategy to raise the inflow of highly skilled migrants from outside the EU. • In 2001, the difference between the number of highly skilled emigrants and highly skilled immigrants has been positive for a number of EU-MS, France and Germany taking the lead, followed by Spain, Sweden, the UK and Belgium. • However, the major winners in the high skilled market are the overseas countries USA, Canada and Australia. • In view of the path dependence of migration, it seems highly improbable that Austria will be able to turn the tide and become a net importer of highly skilled people in the short to medium term.

6. Migrants and natives are largely complementary • Migration policy and the concomitant industrial and education policies resulted in a fairly high proportion of un- and semiskilled workers in all age-groups. • Only a small proportion of the Austrian work force has tertiary education; the majority of the workers are in the medium vocational skill segment. • This situation will not change for some time to come. • Even though younger generations will have better qualifications and training than the previous cohorts, the proportion of unskilled labourers will remain high in international comparison. • This has to be seen in the context of a constant inflow of unskilled immigrants, basically as a result of family reunification and refugee intake, and an underinvestment in higher education on the part of second and third generation migrants

9. Industry restructuring: a challenge for education and training policy • Massive relocation of production and investment in new technology since the early 1990s knew winners and losers • Occupations in the medium skill segment (tradesmen, i.e., persons with apprenticeship education) and unskilled labourers had high job losses, higher skilled workers saw significant employment increases. • Unemployment of unskilled nationals increased between 1989 and 2005 by 35 percent; for migrants, the number more than tripled. • Unemployment of medium skilled nationals (apprentices) increased by 53 percent while unemployment of medium skilled foreign workers was 6 times the number of 1989.

10. Development of unemployment of native and foreign skilled and unskilled workers (1987-2005) Q: AMS.

11. Increased casual work and a rising informal sector • Decline in employment in particular skill segments and occupations and continued rise in labour supply in these skills does not only show up in rising unemployment. • Surplus labour is also the source of labour in casual and involuntary part-time employment, in fringe self-employment outside the core economy at low wages as well as work in the informal sector. • Peripheral workers drift in and out of employment while a core of highly skilled workers continues to retain stable jobs and high wages. • This becomes more and more a feature of the Austrian labour market, affecting natives and migrants alike.

13. Recognition of need for LLL for all • Recent years have indicated that integration of foreign workers into the labour market in the traditional skill segments is becoming increasingly difficult as Austria is outsourcing production processes in the wake of globalisation, in which migrant workers tended to find employment. • Thus major efforts (have to) go into upgrading the skills of residents and migrants such that they can profit from the growing job opportunities in the higher value added end of production of goods and services. (Qualifizierungsmilliarde)

14. System of Lifelong Learning: a coping strategy to accommodate change • While Austria is only at the beginning of putting such a system in place, the objectives are becoming increasingly accepted and the institutional reforms necessary are being discussed. • The key and challenge is the provision of continuous education, i.e. a comprehensive system of initial and further education, with modularisation of education and training within a Common European Qualification Framework. • Some targets are specified in labour market policy, in particular further education and training of youth and mature unemployed. • Others are determined by federal states, in line with the further education and training needs to underpin their regional industrial development policies (Standortpolitik); in some federal states (Bundesländer) a complex integration strategy for migrants is an integral part of the regional socio-economic development strategy. • The idea is that barriers to learning should be lifted and that the responsibility for integration should be shared between employers, employees, the state and the communities as well as civil society at large (NGOs).

15. Network of institutions to connect the potential learner with facilitators to promote learning and employment • Currently the focus of the network is on unemployed, but increasingly also on employed and natives as well as permanent foreign residents who are outside the labour force. The objective is: • 1: to make skills visible (with or without accreditation), • 2. to build on their skills and integrate them into an education and training programme which fills in, where certain skills are lacking either as far as the requirements of the profession are concerned or for another profession/trade which builds on the acquired skills and competences. • 3. the certification of the adapted skills remains a challenge, but the newly established European qualification framework is a promising road in skills recognition and rendering them transparent.

16. The road we are on… • The development of a system of lifelong learning is a major tool to raise and adapt the skill base of the work force and thus productivity. It is the only road Austria may take in view of its limited capacity to attract the highly skilled migrants from abroad • Including migrants in the system of LLL is on the agenda in order not to jeopardise social cohesion. • While migrants will have a role to play in alleviating the problems linked with population ageing, the eventual ageing of the migrants themselves will add yet another dimension to the already daunting task of providing adequate care for an ageing population. • The reduction of illegal immigration will be a challenge as long as the informal sector is large and growing. Illegal work may be a rational coping strategy in a world of scarce formal sector jobs. However, there is a risk of permanent de-skilling of those workers who are effectively excluded from formal employment. This may seriously impair the productive potential of Austria in the longer run. • As migratory processes do not only have an economic dimension but also political, cultural, social, humanitarian and even strategic ones, it is important to inform the native population about the contributions of immigrants to the wellbeing of society. • In this respect Austria will have to learn from the traditional immigration countries overseas, where the media play an important role in informing the general public about the economic benefits accruing from immigration. However, this may partly be the result of a better informed media, as research into the role of immigration in socio-economic development is abundant and outcomes are readily available — a result of a long tradition of generous funding of migration research and a policy of transparency.