A presentation held by prof Charles Woolfson at the seminar "After the Crises? Migration, Austerity and New Challenges to Social Sustainability in the Baltic States", hosted by Global Utmaning on the 7th of December 2012

1. After the Crisis?
Migration, Austerity and New
Challenges to Social Sustainability
in the Baltic States
Professor Charles Woolfson
REMESO
Institute for Research on Migration, Ethnicity and
Society
Linköping University
Global Utmaning Workshop, 7 December 2012

2. Acknowledgments
• Swedish Council for Working Life and Social
Research (FAS) Project Number: 2011-0338,
Svensk modell och baltisk rörlighet:
harmonisering eller social dumpning? En studie
av arbetsmigration mellan Baltikum och Sverige.
• The Swedish Institute, Visby Programme grant
00749/2010 East-West labour migration,
industrial relations and labour standards in a
Swedish-Baltic context.
• Indre Genelyte, REMESO doctoral candidate
prepared key empirical charts in this presentation

3. Where we are today

4. GDP per capita in PPS (Euros) 2010
Source: Eurostat, 2012
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0

5. GDP per inhabitant and average
monthly wage (2011)
Estonia
• GDP per inhabitant 11,900 EUR
• Average monthly wage 792 EUR
Latvia
• GDP per inhabitant Latvia 9,800 EUR
• Average monthly wage 633 EUR
Lithuania
• GDP per inhabitant 10,200 EUR
• Average monthly wage 576 EUR

6. Social protection expenditure as % GDP 2010
30.5%
18.1%
17.8%
19.1%
19.0%

7. The way we were – the ‘fat years’

8. The ‘Baltic Tigers’ GDP Growth Rates 2006

9. Global Property Guide, 2007

10. Market shares of Swedish banks
in Baltic states
June 2009
Market shares public lending
Population 1.3 Population 2.3 Population 3.4
million million million
Sources: Sveriges Riksbanken Bank reports and the
Riksbank

11. Sweden and Baltic household
indebtedness as % GDP
Sources: Sveriges Riksbanken Bank reports and the Riksbank

12. A trend that cannot continue
will not ….

13. ‘Hard Landing’ – Taming the ‘Baltic tigers’

14. Real GDP growth rate compared to previous
year (%)
15
10
5
0
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 (f) 2013 (f)
-5
-10
-15
EU (27 countries) Estonia
Latvia Lithuania
-20

15. Baltic GDP 2009 % change compared with the
same quarter of the previous year
Q1 Q2 Q3 Q4
Estonia -15.0 -16.1 -15.6 -9.5
Latvia -18.5 -17.0 -19.2 -17.1
Lithuania -15.3 -16.6 -14.7 -13.2
Source: Eurostat PEEIs http://epp.eurostat.ec.europa.eu/cache/ITY_PUBLIC/2-07042010-
BP/EN/2-07042010-BP-EN.PDF

16. Unemployment rates in Baltic countries and
EU27
20
18
16
14
12
10
8
6
4
2
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
EU (27 countries) Estonia Latvia Lithuania

17. Real wages in Baltics year on year 2000-2010
25.00
20.00
15.00
Estonia
Latvia
10.00
Lithuania
5.00
0.00
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
-5.00
-10.00
Source: harmonized index of consumer prices - Eurostat online database, nominal monthly salaries – Statistics Estonia,
Central Statistical Bureau of Latvia, Statistics Lithuania

18. Baltic household consumption expenditure 2009
% change compared to same quarter of 2008
source: Eurostat PEEIs
Q1 Q2 Q3 Q4
Estonia -16.5 -19.4 -19.9 -18.2
Latvia -18.3 -23.5 -25.6 -21.7
Lithuania -14.5 -16.9 -17.7 -19.0

19. Total Population: At risk of poverty %
(Cut-off point: 60% of median equivalised income
after social transfers)
Source: Eurostat
27
25.6
25.7
25
23
EU 27
21 20.6 Estonia
20.5 20 20 Latvia
19.7
19.5 19.3 Lithuania
19 19.2
Poland
17.7
18.3 17.1
16.9 17.5
17
16.9
16.4 16.4 16.3
15
2005 2006 2007 2008 2009 2010 2011

20. At risk of poverty, age less than 18
(cut-off point: 60 % of median after transfers)
2011
Source: Eurostat, 2012
35
30
25
20
15
10
5
0

21. Proportion of population at risk of poverty
or social exclusion, 2010 (%)Source: Eurostat

22. 20% of Lithuanians live on <240 Euros per
month, 6% approx 90 Euros per month (2010)

23. Migration

24. Aggregate migration from Baltic states and Poland
to Norway, Denmark and Sweden
25000
23418
21011
20000 19146
17305 18333
15000 13725 15686
15172 Sweden
Norway
9257 9666
10000
8360 9279 8741 9024 Denmark
8069 8737 7141
7881
5098 4810 7135
5000
3708 3573
4439
1813
2389
1116
0
2003 2004 2005 2006 2007 2008 2009 2010 2011

25. Cumulative outflows of EU8 citizens into EU15
Member States (2004-2007) Thousands of Emigrants
Source: Francesca D'Auria, Kieran Mc Morrow and Karl Pichelmann, Economic impact of migration flows
following the 2004 EU enlargement process: A model based analysis.

26. Cumulative outflows of EU8 citizens into EU15
Member States (2004-2007)
% Working Age Population of EU8 Countries
Source: Francesca D'Auria, Kieran Mc Morrow and Karl Pichelmann, Economic impact of migration flows
following the 2004 EU enlargement process: A model based analysis.

27. Emigration rates (per 1000 inhabitants) from
Estonia, Latvia and Lithuania (2001-2011)

28. Baltic emigrants by age group 2011
(% of all who emigrated that year)
Source: National statistic offices, 2012
25%
21.8%
21%
19.9%
20%
17.4%
17.3%
15.5%
15%
13.2%
13.9% 13.5%
12.7% Estonia
Latvia
10.5% 10.5%
9.7% Lithuania
10%
8.4% 8.6% 8.6%
7.1% 7.6%
6.9%
6.5% 6.1%
5.5%
5% 5%
4.2%
0%
0-14 15-19 20-24 25-29 30-34 35-39 40-44 45-49

29. Emigration by gender
(% of all emigrated that year) 2011
Source: National statistic offices, 2012
60%
52.7% 51.7%
50% 50%
50% 47.3% 48.3%
40%
30% Male
Female
20%
10%
0%
Estonia Latvia Lithuania

30. Remittances

31. Remittances and earnings abroad* (EUR
million)
Source: SEB Baltic Outlook April 2012
Latvia

32. Remittances and earnings abroad* –
share of household disposable income
2000-2010
Source: SEB Baltic Outlook April 2012

33. Remittances to Baltics and Poland
% of GDP 2004-2011
Source: World Bank 2012
5.0
4.6
4.5
4.0 Estonia
Latvia
3.5
Lithuania
3.0
3.1 Poland
2.5
2.5
2
2.0
1.8 1.8
1.5
1.5 1.5
1.0
2004 2005 2006 2007 2008 2009 2010 2011

34. Demographics and population loss

35. Life expectancy at birth 2010
Source: Eurostat

36. Life expectancy at 50 years of age (years)
Source: Jagger et al the Lancet, 17 November 2008
Life expectancy at 50 years of age (years)

37. Natural increase/decrease in the Baltic
states per 1,000 population
From Peteris Zvidrins ,Centre of Demography, University of Latvia, DEPOPULATION IN THE BALTIC STATES

38. Aggregate natural population
increase/decrease 1990-2011
Source: SEB Baltic Outlook April 2012

39. Population reduction in Latvia
(data 2011 compared to 2000)

40. Demographic projections for Baltic states
2010-2060
Source: Eurostat
Census 2012
3 007 700
Census 2012
2 041 763

41. ‘Voice’, democratic representation
and
social justice

42. Narratives of austerity

43. Riga January 2009
Largest mass demonstration since 1991

44. Riga street battles

45. Vilnius January 2009
Doors of the Lithuanian parliament

46. No Fear!

47. Teargas on Independence Square, Vilnius

48. Lithuania
1991 76%
2009 50%
Change -26%

49. Lithuania
2009 48%

50. Things are going in the right direction or in the
wrong direction in your country? (% of positive)
Source: Estonia HDR 2011

51. President Dalia Grybauskaite
‘State of the Nation’ address 2010
I do not think about (emigration) as merely an
economic phenomenon. It is rather a reflection
of the relationship between an individual and
the state.
The decision to leave the homeland is a difficult
one. We console ourselves by saying that it is a
natural consequence of the downturn. However,
the countries where our fellow citizens emigrate
are also challenged by the crisis…
So, let us look the reality in the face and admit
that people are emigrating not only for
economic reasons. They are moving abroad
because they feel alien at home.

52. Threats facing Baltic countries
1. Demographic decline threatens long-term
fiscal sustainability, especially of pension
systems.
2. Labour force high youth unemployment,
shortage of skilled labour and skill
mismatches, aggravated by high emigration.
3. Poverty and social exclusion even higher
strains on public finances in the near future.
4. Social disenfranchisement and political
alienation creating further migration ‘exit’

53. After the crisis: meeting the challenges of
globalisation
1. Education: Investment in skills, vocational
and higher education for ‘high road’ of
competitiveness
2. Labour: Recruitment of non-Baltic labour
forces to fill labour force gaps
3. Citizenship: ‘Dual citizenship’ and position of
non-citizens in Latvia and Estonia
4. Migration policies: integration of return
migrants
5. Democratic/cohesion issues: ‘voice’ in
politics, community and workplace