Skilled immigrants have helped sustain the boom

Ten years ago, when the Central Statistics Office (CSO) first asked in a survey if a household member had emigrated in the previous year, they got a poor response. The following year they changed the question, asking whether someone had left in the past year to work abroad. The deletion of the reference to emigration elicited a very different (and correct) estimate of the substantial numbers then leaving the country.

For most families today, the move abroad by their children is not viewed as permanent (emigration), but rather as a more temporary phenomenon. This is a different world from the "American wake" of the 19th century, where the departing children would never be seen again. While some of those who go today may never return permanently, for most of them and their families the prospect of return looms large. The reality in the 1990s has reflected this with many of the 1980s emigrants returning to live and work in Ireland.

The characteristics of the new "emigrants" are also very different from those who left in the first 50 years of independence. Traditionally, Irish emigrants were unskilled with a limited education. However, over the course of the 1980s, the pattern shifted radically so that by the end of the decade those who went were generally well educated. While many of the best-educated young adults in the late 1980s left for Britain or the US, they were also the most likely to return.

For the adult population as a whole, between 10 per cent and 15 per cent have lived abroad for at least a year and, for those with a university education, the proportion is much higher.

Even in the 1990s, when the outflow of emigrants has turned into a net inflow of people, there is still a continuing large gross outflow of young people seeking experience and work abroad.

What has changed is that this, albeit large, outflow is now swamped by an even larger inflow. This pattern of emigration and return is quite unusual by international standards.

The inflow in recent years is not just due to Irish people returning from abroad. A substantial proportion of those coming to work in Ireland are not Irish citizens. While a significant number of them are probably spouses and children of Irish emigrants, many of them have no direct link with Ireland.

The trickle of refugees to Ireland has attracted some notice over the past year, but their number is small compared to the influx of foreigners coming to work here.

A paper to be presented by two colleagues, Alan Barrett and Fergal Trace, at a major conference* on migration next week will show that the bulk of these foreigners coming to Ireland are highly educated. Their numbers have not attracted notice because their skills have made them indispensable to many rapidly growing sophisticated firms. Their good English and relatively high incomes (and often Irish spouses) means that they do not stand out.

In the past, emigration from Ireland was driven by the gap between opportunities for employment in Ireland and those in other countries, especially Britain. When satisfactory jobs became available in Ireland the relatively well qualified and experienced emigrants tended to return and fill them (as in the 1970s). This meant that, in spite of very substantial job creation in the good times, the impact on unemployment was relatively small.

Well-qualified, returning immigrants filled skilled jobs which were not available to the unskilled unemployed. However, in the face of the exceptionally buoyant labour market today we are seeing many firms in Ireland seeking additional skilled labour abroad in Britain, Germany, Scandinavia and even further afield.

In another paper to be presented at the conference next week, a well-known economist from Harvard, George Borjas, discusses how the massive post-war immigration into the US has affected the labour market there.

As yet we don't fully understand the relatively new role that immigration is playing in the Irish economy. It certainly makes the economy much more flexible than many of our EU neighbours, less vulnerable to shocks and facing fewer restrictions on its potential growth rate.

Without the substantial influx of additional skilled workers from outside Ireland, many of them returning emigrants, the current exceptional growth rates could not have been sustained.

For over 200 years Ireland sought, and obtained access for our young people to the best labour markets in the world. Today, it is one of those labour markets, envied by many less fortunate job seekers in the rest of the world.

In this light, some of the responses to the trickle of asylum seekers over the last few years seems particularly hypocritical. Such an unconsidered response could prove counterproductive. Many of our young people still avail of the opportunity to obtain experience through working abroad. Why should the US or Australia treat our young people favourably when we overreact to similar demands from non-EU citizens?

Whatever the moral arguments, the needs of the economy over the next decade may provide a more selfish reason for taking a more positive stance on immigration.

John FitzGerald is a research professor at the Economic and Social Research Institute. He is one of the speakers at a conference organised by the Irish Economic Association on the economics of migration at the Industry Centre, UCD, on Tuesday, June 23rd.