Deutsche Bank
Research
Eurozone
Economics
Date
11 September 2015
Barbara Boettcher
Economist
(+49) 69 910-31787
barbara.boettcher@db.com
Migration into the EU - a first look at
the impact
Dieter Braeuninger

In H1 2015 about 430,000 asylum seekers entered the EU-28. In Germany
the minister of the interior even expects 800,000 new applicants in 2015.
According to the Spring 2015 Eurobarometer survey, citizens in the
member states see immigration as the most important problem in the EU,
overtaking the economic issues.

In the EU a debate has started on a new mechanism for the relocation of
the applicants. According to the ‘Dublin System’ the member states at the
southeastern and southern EU borders are responsible for the bulk of the
applications. However, the so-called frontline countries, especially Greece,
Italy and Hungary, have increasingly felt overburdened with this task.

The European Commission has proposed to relocate 120,000 asylum
seekers on the basis of a mandatory distribution key referring to the
member states’ GDP (weighted 40%), the population size (40%), the
unemployment rate (10%) and number of asylum seekers already hosted
(10%). The European Council will decide on this proposal on September 14.

However, some Central and Eastern European countries have refused
mandatory schemes, so far. Denmark, Ireland and the UK, which have optout options for the respective matters, are also unlikely to participate in
such a scheme. Together with others the respective three member states,
however, have declared to host refugees on a voluntary basis. Anyway, all
these proposals for mandatory and voluntary distribution would cover only
about one-third of all the asylum seekers who arrived in H1 2015, and
many more will come in H2.

If Europe fails to reach a compromise on a fair method of burden sharing
the principle of free movement in the Schengen area could be at risk. A
return to border controls would impose new costs on business and
constitute a severe burden for all proposals for further integration in the EU.

At first the registration, hosting, provision of health services and measures
for the integration of the asylum seekers will entail considerable costs
which in Germany amount to about EUR 12,000 per capita and per year.
However, the public coffers will not be overloaded. Germany, for example,
will be able to finance the additional outlays without jeopardising the
target of a balanced budget. Other countries, especially the frontline
countries, will be challenged more depending on the number of applicants
they ultimately host.

For the time being the economic impact of the immigration wave will be
limited. Except for the frontline countries as well as Austria, Germany and
Sweden most EU countries have only registered relatively small numbers
of applicants so far. In Germany a EUR 5 ¼ bn increase in public spending
means a slight stimulus of about 0.17% to GDP in 2015. The medium-term
impact on the demand side could be more pronounced. Especially
Germany could benefit a lot, given its ageing workforce. However,
noteworthy supply-side effects will only emerge to the extent that
Germany is able to integrate the newcomers into the labour market.
Therefore, further deregulation is needed.
We
thank
Jan-Eric
Filipczak
for
contributing
with
valuable
research
to
this
Economist
(+49) 69 910-31708
dieter.braeuninger@db.com
paper.
________________________________________________________________________________________________________________
Deutsche Bank AG/London
DISCLOSURES AND ANALYST CERTIFICATIONS ARE LOCATED IN APPENDIX 1. MCI (P) 124/04/2015.
11 September 2015
Focus Europe: Migration into the EU - a first look at the impact
Germany: 800,000 asylum seekers expected in 2015
Ongoing violent conflicts in Europe’s neighbourhood have caused millions of
people to leave their homes. Since the beginning of 2012, 4.1 m refugees have
fled from Syria alone. Most of them have settled in UNHCR refugee camps in
Jordan, Lebanon and Turkey. As the conflicts have not calmed down and the
situation in many refugee camps has become increasingly difficult more and
more people have made their way to Europe. In H1 2015 the number of asylum
applicants in the EU increased by about 80% vs H1 2014 and reached about
430,000. Given the strong upward trend in recent months, the total number in
2015 is very likely to be much more than twice as high as in 2014 when
627,000 applicants were recorded.
Germany registers the highest numbers in absolute terms. In 2014, 203,000
persons applied for asylum, i.e. 32% of all applications in the EU. In H1 2015
the respective share was about 40%. Second comes Sweden (13% in 2014),
followed by Italy, France (10.3%, respectively) and Hungary (6.8%). The UK,
where domestic political debate on immigration has been especially vocal for
quite some time, ranked 6th at 5.1%, i.e. 32,000 applicants. The ranking
changes markedly, however, when it is measured in relative terms, i.e. against
the size of the respective country’s population. Over the past 12 months – July
2014 to June 2015, Hungary ranked 1st on this score with 10.4 applicants per
1,000 inhabitants, followed by Sweden with 8.1, Austria (5.6) and Germany
(3.7). The respective figure for the UK is 0.5.
As recent monthly figures skyrocketed to about 100,000 asylum seekers in
Germany in August, the German minister of the interior now expects 800,000
applicants in 2015. Even though Germany has experienced several waves of
immigration this will be the highest number of foreign immigrants in several
decades. However, measured against the country’s 81 m inhabitants the share
of new applicants will remain marginally below 1% in 2015.
Figure 1: Surging numbers of asylum
applicants
35 Asylum and first time asylum
30 applicants monthly
25 data, 1,000
20
15
10
5
0
2013
2014
2015
DE
FR
IT
HU
SE
UK
Source: Eurostat, Deutsche Bank
Figure 2: Asylum applicants in the
EU 28, 2014, by regional breakdown
Figure 3: Asylum applicants in the
EU 28, H1 2015, by regional
(%) (Total 627,000)
breakdown (%) (Total 430,000)
Others
17.7
AT 4.5
UK 5.1
DE 32.4
Others
13.2
UK
3.5
SE
6.7
AT
6.6
DE
39.9
SE 13.0
HU 6.8
HU
15.5
IT 10.3
FR 10.3
Source: Eurostat, Deutsche Bank
IT
7.1
FR
7.5
Source: Eurostat, Deutsche Bank
While the majority of the refugees are from the crisis regions in the Middle
East and Africa, a sizeable share comes from the Western Balkan states. In
2014, from all asylum seekers in the EU 20% came from Syrian, 7% from
Afghanistan and 6% from Eritrea, while 6% migrated from the Kosovo and 5%
from Serbia. For many people from the Western Balkan states, economic
reasons, i.e. the search for higher income, seem to play a major role in the
decision to migrate. This can be concluded from the fact that in Germany,
where asylum seekers can get relatively high cash benefits (see below), about
40% of all applicants in H1 2015 came from the Western Balkan region.
Page 2
Deutsche Bank AG/London
11 September 2015
Focus Europe: Migration into the EU - a first look at the impact
At first, however, most of the asylum seekers enter the EU via countries with
borders near to these three regions, the so-called frontline states. According to
the latest information from the UNHCR, 205,000 refugees have arrived in
Greece, 140,000 in Hungary and 115,500 in Italy since the beginning of 2015.
However, the immigrants‘ actual target destinations are the more prosperous
EU member states further north, especially Germany, Sweden and the UK.
Figure 4: Top ten asylum seekers
Figure 5: Asylum applicants in the
Figure 6: Growing concern about
host countries in the EU28
EU by major countries of origin
immigration as the EU's most
important issue*
60
HU
2014 applications, '000s
120
SE
100
AT
DE
DK
30
60
LU
Asylum applicants per
1,000 inhabitants
from July 2014 to
June 2015
BE
CY
NL
EU28
0
2
4
6
Source: Eurostat, Deutsche Bank
8
10
20
40
10
20
0
DE
0
Syria Afghan. Kosovo Eritrea Serbia
12
50
40
80
MT
%
Source: Deutsche Bank
IT
Autumn 2014
NL
UK
Spring 2015
Source: Deutsche Bank
* Share of respondents who have stated that immigration is one of
the two most important issues facing the EU
Most important issue facing the EU
According to the latest Spring 2015 Eurobarometer survey, citizens now see
immigration as the most important problem in the EU, overtaking the
economic issues that have led the ranking of main concerns since this
question was first asked in autumn 2010. In 20 member states immigration
ranks first in the respective hierarchy of the most important EU issues. On
average immigration from outside the EU evokes a negative feeling for 56% of
EU citizens, while for 34% it is associated with a positive feeling. Interestingly,
these perceptions have hardly changed compared to the Autumn 2014 survey.
In contrast, the share of citizens who see immigration as a major issue for the
EU has increased by 14 pp to 38% since autumn 2014.
On the national level, the reservations against immigration are not correlated to
its actual extent, i.e. immigration as a percentage of the respective country’s
total population. However, the attitude seems to be (slightly) related to the
economic prosperity. The higher the GDP per capita the higher is the
acceptance of immigrants and the less respondents have stated negative
feelings in the latest Eurobarometer survey. Negative feelings are strongest in
Central and Eastern European countries, especially the Baltic states, although
the latter countries have registered only relatively low numbers of asylum
applicants. In contrast, in Germany the ratio of persons who stated positive
feelings to those with negative associations is relatively high at 38 to 54. In the
UK the ratio is nearly the same (39 to 55). Despite the strong increase in the
number of immigrants, Germans seem to have even become more openminded, as the ratio has significantly improved since autumn 2014 (29 to 61).
A clear-cut positive attitude, however, prevails only in Sweden with 66 to 31.
Deutsche Bank AG/London
Page 3
11 September 2015
Focus Europe: Migration into the EU - a first look at the impact
Figure 7: The higher the GDP per
Figure 8: The higher the GDP per
Figure 9: Sentiment about
capita, the lower is reservation
against migrants
capita, the higher is the acceptance
of migrants
immigrants from outside the EU
70
90
80
60
70
50
60
50
40
40
30
30
20
Share of resondents with negative
feelings, % (y-axis) vs GDP per
capita in PPS 10,000 (x-axis)
20
10
0
14
18
22
26
30
34
Source: Eurobarometer 83, Eurostat, Deutsche Bank Research
80
60
40
20
0
-20
-40
-60
-80
-100
Share of respondents with
postive feelings % (y-axis)
vs. GDP/capita in PPS
10,000 (x-axis)
10
38
Spring 2015, %
DE
0
14
18
22
26
30
34
38
Source: Eurobarometer 83, Eurostat, Deutsche Bank Research
FR
positive
IT
HU
SE
UK
BS*
negative
Source: Eurobarometer 83, Deutsche Bank
*Baltic States
Dublin System in need of reform
Notwithstanding differing attitudes among the citizens in the various member
states, an intense debate has started on the institutions and mechanisms
determining the responsibilities for the application process and the (final)
residence for asylum seekers in the European countries involved, i.e. the EU-28
plus Norway, Iceland, Liechtenstein and Switzerland. The present set of rules,
the “Dublin System”, consists of the “Dublin Regulation” (Reg (EU) No.
604/2013) and three further regulations stipulating administrative details. The
Dublin Regulation has two aims: (1) it is to make sure that one, i.e. only one,
member state is responsible for the examination of an asylum application and
ensure an efficient procedure and prevent multiple asylum claims. (2) It defines
a set of hierarchical criteria to identify the member state in charge of each
asylum application and the provisions attached for the respective asylum
seeker. In a nutshell the following principle holds: provided that an applicant
has no close relatives in another member state and neither possesses a
residence permit or visa in a partner country nor has illegally crossed borders
within the EU, then the first member state in which the application was lodged
is responsible for processing the application.
This means that in practice those member states nearest to the asylum
seekers’ home countries, the frontline members, are responsible for the bulk of
the applications. Given the massive expansion of immigration in recent months,
the respective states, especially Greece and Hungary, have increasingly felt
unable to cope with their responsibility. They are concerned that the
immigration wave is overstretching their administrative infrastructure as well
as their financial resources.
To support these countries the EU has decided to establish “hotspots” for the
reception of asylum seekers. These facilities shall be funded and staffed in part
by immigration officers and other experts from other member states. The first
such facilities have started operations or will do so in Italy and Greece, while
others might be opened in Hungary, too.
As a result of lacking administrative capacities many asylum seekers have
passed these countries without an examination of their asylum application.
Many have finally entered member states further north such as Austria,
Germany and Sweden, i.e. the countries that are the favourite destinations for
most immigrants anyway.
Page 4
Deutsche Bank AG/London
11 September 2015
Focus Europe: Migration into the EU - a first look at the impact
For quite some time Germany has refrained from sending back the respective
immigrants to Greece, and recently it has also adopted this practice with
immigrants who entered the EU in Hungary without being registered there and
then moved on to Germany. However, this does not mean that Germany will
no longer insist on the principles of the Dublin System but instead accept each
applicant especially from Syria, as some press reports have stated.
Alternative relocation mechanisms debated
Given the shortcomings of the Dublin System and the struggling of some
frontline countries with the current situation, the European Commission has
tried to establish alternative mechanisms for the relocation of certain groups of
asylum seekers, at least. Thus, already on May 27 the Commission proposed
to relocate over the next two years a total of 40,0000 Syrian and Eritrean
nationals that arrived in either Greece (16,000) or Italy (24,000). According to
the proposal this mandatory relocaction to other member states – with the
exception of Denmark, Ireland and the UK – shall be based on a new
distribution key. This key includes four criteria which shall be given different
weights: 40% for the respective country’s GDP, 40% for the size of its
population, 10% for the unemployment rate and 10% for the number of
asylum seekers already hosted over the past four years. The new mechanism
comprises financial aid for the new host countries totalling EUR 6,000 per
person relocated.
Furthermore, the Commission has now announced an additional plan to
relocate another 120,000 asylum seekers among the member states on the
basis of the above-mentioned key. This new mechanism should not only be
applied to Greece and Italy but also to Hungary, which asked Brussels for
support a few days ago. To enhance the plan’s efficiency and prospects of
success the Commission is also considering fining those countries unwilling to
host additional asylum seekers. Although the plan could provide some relief to
the three frontline states, it only applies to about 25% of all refugees who have
entered these countries since the beginning of 2015 – not to mention those
who could still arrive.
Nevertheless, the realisation of the Commission’s plans would markedly
change the local distribution of the refugees among the member states.
Roughly calculated, in Germany for instance, the number of asylum applicants
would shrink by about 35,000 to 765,000 in 2015. Of course, the impact would
be much stronger if all asylum seekers were resettled on the basis of the new
scheme. To get an impression of the impact in this case we have calculated a
notional distribution for 2014 and compared it with the actual figures for last
year. As the chart shows Germany, Sweden, and Hungary would be the main
beneficiaries, while the Baltic states, and some other Eastern European
countries as well as Belgium, Ireland and the UK would have to accept many
more asylum applications than they had in reality.
Figure 10: Proposal for relocation of
120,000 asylum applicants within
the EU*
Number of applicants the respective
member states shall host, 1,000
BE
BG
CZ
DE
EE
EL
ES
FR
HR
IT
CY
LV
LT
LU
HU
MT
NL
AT
PL
PT
RO
SI
SK
FI
SE
0
10
20
Source: European Commission, Deutsche Bank Research
* States to opt-out of the Dublin System are excluded
Figure 11: Asylum applicants in 2014
vs applicants on the basis of the new
key
BS*
Selected countries, '000s
PT
CZ
ES
PL
NL
AT
HU
FR
IT
SE
Not surprisingly, the Commission’s proposals for mandatory relocations are
highly controversial. So far several countries have rejected the plans, albeit for
different reasons. While some countries, especially those from the so-called
Visegrad group (Czech Republic, Hungary, Poland and Slovakia), have
fundamentally opposed any plans for mandatory relocations, others like Spain
have advocated alternative distribution keys, e.g. higher weights for the
unemployment rate and/or asylum seekers already hosted. In order to achieve
a reasonably fair method of burden sharing acceptable to all member states
including the sceptical ones, the Commission will also have to bring in the
three countries already mentioned above – Denmark, Ireland and the UK –
which have opt-out/opt-in rights with respect to the relevant Dublin System
Deutsche Bank AG/London
DE
0
50
100
150
200
numbers on the basis of the new key
actual numbers
Source: European Commission, Eurostat, Deutsche Bank
Research
*Baltic States
Page 5
11 September 2015
Focus Europe: Migration into the EU - a first look at the impact
and Schengen matters. The upcoming Council meeting on September 14 will
discuss this issue.
Voluntary quotas would hardly be sufficient
Due to the opposition, the plan for the mandatory resettlement of 40,000
Syrian and Eritrean refugees was abandoned in July. Instead the member
states have agreed to relocate 32,256 of these refugees on a voluntary basis
among 22 member states. This has come in addition to an agreement on the
resettlement of 22,000 persons – many of them Syrian refugees – from UN
refugee camps in the Middle East to Europe over the next year under a
voluntary scheme. 31 countries, namely 27 member states – including the UK,
but excluding Hungary – plus Liechtenstein, Iceland, Norway and Switzerland,
have declared willingness to participate in this scheme. A few days ago British
PM David Cameron announced that his government is willing to accept several
thousand refugees p.a. – 20,000 over five years – from UN camps to the UK, in
addition to the 2,200 already processed.
However, it is questionable whether voluntary measures will suffice to solve
the migration crisis. Especially Germany and France have frequently stated that
they agree on the principle of “binding quotas”. Thus these two countries and
the Commission have to convince the opponents. These players and other
member states are also likely to ask the UK, which has usually opted out any
quota system, to show greater solidarity, i.e. to participate in a mandatory
scheme. Anyway, all agreements and proposals for mandatory and voluntary
distribution presented so far will cover only about one-tenth or so of all asylum
seekers likely to arrive in the EU in 2016.
If Europe fails to reach a compromise on a fair method of burden sharing the
principle of free movement in the Schengen area could be at risk. The
Hungarian government has already asked Germany to re-establish border
controls. Such controls would make the transportation of goods and persons
especially from southern and eastern European member states to the core
more time consuming and more expensive. Above all, as a retrograde step it
would be a severe burden for all proposals for further integration in the EU.
Multi-solutions approach debated
The idea of a mandatory quota, however, is not the only element of the
Commission’s recent package. To get to one of the roots of the crisis the
Commission has also proposed a common EU list of safe countries of origin as
a device for procedural simplification. According to Commission President
Jean-Claude Juncker the presumption of safety must apply to all countries
which the European Council unanimously decided meet the basic Copenhagen
criteria for EU membership – notably as regards democracy, the rule of law,
and fundamental rights and it should also apply to the other potential
candidate countries of the Western Balkans. 1 Therefore the list could include
Albania, Bosnia and Herzegovina, the former Yugoslav Republic of Macedonia,
Kosovo, Montenegro, Serbia, and Turkey. In stating a reason for his proposal
President Juncker recently said: “It does not make sense that on the one hand,
Member States have decided to make Western Balkan countries candidates for
EU accession and, on the other, nationals of these countries are applying for
asylum in the EU” 2 . Although the number of asylum applicants from the
1
Juncker, Jean-Claude. State of the Union 2015: Time for Honesty, Unity and Solidarity. See obove.
2
Juncker, Jean-Claude: A call for Collective Courage. Statement - 28 Aug. 2015. Internet
http://ec.europa.eu/commission/2014-2019/president/announcements/call-collective-courage_en
Page 6
Deutsche Bank AG/London
11 September 2015
Focus Europe: Migration into the EU - a first look at the impact
Balkan countries has declined recently, such a declaration would be helpful. It
would make it easier for the national authorities to differentiate between
applicants who have fled from war or expulsion in their home countries and
others who have migrated for economic reasons. Thus it would be possible to
fast-track asylum procedures. In Germany the asylum procedure lasted 5.3
months on average in H1 2015, and in addition it can take several weeks
before an asylum seeker can file such an application.
Member states are also debating reasonable options for those asylum seekers
whose application was refused. Of course, the member states have the right to
send these people back to their home counties. But Germany, for example, has
hardly taken this option, so far. In 2014 only about 5% of those 200,000
refused were sent home. Instead, refused applicants often simply file a new
application and thus the procedure results in a revolving door effect. However,
refused applications are not allowed to enter the labour market.
To reduce the number of refugees from poverty, Germany’s grand coalition
government has decided to change the benefits granted to asylum seekers.
During the phase in which the applications are examined cash benefits shall be
replaced by benefits in kind, especially for those asylum seekers living in
camps or hostels. This is meant to reduce the incentives especially for people
in the Western Balkan states to migrate to Germany. So far, Germany has
granted relatively high benefits also compared to the wages in the Balkan
states, e.g. asylum seekers living in a camp or hostel get EUR 143 per months
(children EUR 84 to EUR 92 depending on their age). Those who have to cook
for themselves get EUR 359 per month plus free accommodation (including
heating). Once the application is approved the respective individuals have
access to the benefits from the Hartz IV welfare system (EUR 399 p.m. for
adults and EUR 234 to EUR 302 p.m. for children depending on their age plus
accommodation (incl. heating)).
In other countries, except e.g. Belgium, especially cash benefits for applicants
living in a camp or hostel are markedly below the German level, e.g. the
Netherlands grants EUR 105 p.m, Sweden EUR 76 and Switzerland EUR 30.
Denmark offers the highest cash benefits (EUR 1454 p.m. for single adults) for
those outside such facilities, although the benefits will be reduced from
January 2016 onwards (EUR 790 plus EUR 200 for those who have passed a
language test). For comparison: In Western Balkan states like the Kosovo or
Albania the average monthly wage is markedly below EUR 300.
Considerable cost, but no overload for public coffers
In Germany, total costs per applicant are estimated at EUR 12,000 per year.
According to our rough calculations, German public authorities will thus have
to spend about EUR 6 ¼ bn on asylum policy compared to about EUR 1 bn in
2014. This calculation is based on the assumption that last year’s 200,000
applicants will stay over the whole year 2015 and that most of this year’s
800,000 new applicants will arrive in H2. In 2016 expenditures are likely to
reach double-digit figures. However, it is hard to make sensible estimates for
two reasons: (1) At the moment, one cannot tell how many of this year’s
applicants will still stay over the whole of 2016. (2) The number of new arrivals
in 2016 is open, too. Both figures very much depend on the authorities’
willingness and ability to send applicants from the Western Balkans back to
their home countries or, at least, to stop supporting them. And, of course, the
financial burden depends on the progress made in integrating the newcomers
in the labour market. In an extreme scenario where no one would be sent back
and the number of new asylum seekers would be as high as in 2015 and all
applicants needed full support over the whole year, public expenditure could
be as high as nearly EUR 17 bn in 2016, i.e. about EUR 10 ½ bn higher than in
Deutsche Bank AG/London
Page 7
11 September 2015
Focus Europe: Migration into the EU - a first look at the impact
2015. In the opposite scenario, where applicants from secure states would no
longer be eligible for benefits public expenditure would amount to about EUR
10 bn, i.e. about EUR 3 ¾ bn more than 2015, or less in case a marked number
of the applicants found work and thus needed no or only reduced benefits. In a
more likely scenario, public expenditure will be about twice as high as in 2015.
Given Germany’s solid economic growth and buoyant tax receipts, which in
2015 will be about EUR 5 bn higher than previously expected, it should be no
problem for the government to finance the additional outlays without
jeopardising the target of a balanced budget. The same will be true for 2016.
Public finances in some other countries, especially the frontline countries, will
be challenged more, depending on the number of applicants they ultimately
host and on the support they receive from the EU. At present, however, it
would be difficult to make serious calculations.
Limited impact on the German economy for the time being
For the EU as whole the economic impact will be negligible, at least in 2015.
Measured against the Union’s 507 m inhabitants, the number of registered
asylum applicants in H1 2015 adds up to 0.09% only. Although the number is
likely to increase strongly in H2 it will remain very small in relative terms. From
the present point of view, i.e. referring to H1 figures for the individual countries,
limited demand and/or supply-side effects will only emerge in a few countries,
namely the three above-mentioned frontline countries as well as Austria,
Germany and Sweden.
But even in Germany the economic impact of the new wave of immigration
will be limited for the time being. A EUR 5 ¼ bn increase in public spending
would mean a slight stimulus of about 0.17% to GDP in 2015, assuming that
all the money will be spent in Germany, i.e. applicants do not send parts of the
transfers to their home countries.
The medium-term impact on the demand side could be more pronounced.
Especially Germany seems to be predestined to benefit substantially, given
Germany’s high demand for labour at present and its ageing workforce which
also will markedly shrink without immigration. In contrast to the frontline
states, in Germany the labour market is in good shape, employment continues
to grow and the unemployment rate has reached record lows. In some sectors
such as health care and long-term care, bottlenecks have already emerged. In
2014, when total net migration (including intra-EU migration) already reached
more than 0.5 m and most of the migrants strengthened the workforce,
roughly one-third of the GDP growth of 1.6% is likely to have been attributable
to immigration. 3
Figure 12: Germany: Growing share
of the 55+ among the employees
100%
80%
60%
40%
20%
0%
2000
However, noteworthy supply-side effects will only emerge to the extent that
Germany is able to integrate the newcomers into the labour market. This is a
challenging task. To be able to enter the market immigrants first have to
overcome the language barrier. Although all recognised refugees are obliged to
participate in a language course free of charge it will take some time for the
authorities to offer a sufficient number of courses and sufficiently improve the
newcomers’ language skills. Many will also have to improve their qualifications.
According to information from the SPD Mayor of Hamburg, about one-third, i.e.
a higher percentage than among the residential population (29%), has very
15-24
2003
2006
25-39
2009
40-54
2012
55+
Source: BA, Deutsche Bank Research
3
Deutsche Bank Research (2015). Migration boom continued in 2014, but calls remain for policy action.
Talking Point June 22.
Page 8
Deutsche Bank AG/London
11 September 2015
Focus Europe: Migration into the EU - a first look at the impact
good qualifications, another third shows education and training deficits which
could be overcome and for the others considerable efforts will be needed to
improve their qualifications. However, reliable up-to-date data is only available
for some groups, e.g. people from Syria, 33% of whom have reached A levels
for their school leaving examination.
Furthermore, asylum seekers still face administrative obstacles in efforts to
gain labour market access. After having filed their application they are
confronted with a waiting period of three months. After that for all but skilled
workers a "priority" check continues to apply – for a period of one year. This
means that, in principle, market access is granted during this period only if
there is no other equally qualified candidate for a given job. Besides, asylum
seekers and those given discretionary leave to remain are barred from
temporary agency work. Also the minimum wage of EUR 8.50 per hour hardly
fits the challenge of integrating higher numbers of the less qualified
immigrants into the labour market. Asylum seekers should be exempted from
the minimum wage from the beginning and not only after one year of welfare
(Hartz IV).
All in all the new wave of immigration offers the prospect of a rejuvenation of
Europe’s ageing societies with a positive impact on the economy, especially in
Germany – provided the necessary measures are taken to successfully
integrate the newcomers into the labour market.
Deutsche Bank AG/London
Page 9
11 September 2015
Focus Europe: Migration into the EU - a first look at the impact
Appendix 1
Important Disclosures
Additional information available upon request
*Prices are current as of the end of the previous trading session unless otherwise indicated and are sourced from
local exchanges via Reuters, Bloomberg and other vendors . Other information is sourced from Deutsche Bank,
subject companies, and other sources. For disclosures pertaining to recommendations or estimates made on
securities other than the primary subject of this research, please see the most recently published company report or
visit our global disclosure look-up page on our website at http://gm.db.com/ger/disclosure/DisclosureDirectory.eqsr
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The views expressed in this report accurately reflect the personal views of the undersigned lead analyst(s). In addition,
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Page 10
Deutsche Bank AG/London
11 September 2015
Focus Europe: Migration into the EU - a first look at the impact
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Page 11
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Focus Europe: Migration into the EU - a first look at the impact
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Page 12
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Focus Europe: Migration into the EU - a first look at the impact
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Page 13
David Folkerts-Landau
Group Chief Economist
Member of the Group Executive Committee
Raj Hindocha
Global Chief Operating Officer
Research
Marcel Cassard
Global Head
FICC Research & Global Macro Economics
Steve Pollard
Global Head
Equity Research
Michael Spencer
Regional Head
Asia Pacific Research
Ralf Hoffmann
Regional Head
Deutsche Bank Research, Germany
Andreas Neubauer
Regional Head
Equity Research, Germany
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