Job opportunities determine labor migration more than welfare policy: CPB

The demand for labor is the main driving force behind migration to the Netherlands. The country’s social security policy seems to play a much smaller role in attracting migrant workers but does play a significant role in the decision to stay in the Netherlands permanently, the Netherlands Bureau for Economic Policy Analysis (CPB) said in the report Economic Dynamics and Migration, published on Tuesday.

The CPB found a clear link between the economy and migration in the past 70 years. “When the economy is doing well, more migrants usually come to the Netherlands. During a recession, fewer immigrants come, and more emigrants leave,” the agency said. A thriving economy means companies can hire more people, creating job opportunities for migrant workers. It stressed that it found “no connection with the economic situation for the arrival of asylum seekers.”

The increased use of temporary contracts in the Dutch labor market also encourages employers to attract more migrant workers, the CPB said. “Research shows that a lower level of dismissal protection leads to a higher migration balance.” The migration balance is immigration minus emigration.

The CPB can’t yet say whether the increase in the minimum wage will lead to more or less immigration. “There is also no clear evidence that a broader social safety net is an important motivator for migrants, although the social safety net did play a role in the permanent settlement of guest workers in the 20th century,” the CPB said.

The agency urged the government to learn from the past when it comes to its migration policy. From the 1950s to the 1970s, the Netherlands also wanted to attract migrant workers temporarily. Many ended up staying permanently. In the years that followed, the industries that attracted workers from abroad - mining and textiles - shrank significantly. That resulted in high unemployment among these workers, who often had difficulty finding another job due to their limited education.

“Pay attention to the long-term employability of migrants, and pursue a (labor) migration policy that is consistent with the (desired) direction in which the Dutch economy - and the associated labor demand - will develop,” the CPB said.