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Review of the Transitional Restrictions on Access of Bulgarian and Romanian Nationals to the UK Labour Market

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Review of the Transitional Restrictions on Access of Bulgarian and Romanian Nationals to the UK Labour Market Review of the transitional restrictions on access of Bulgarian and Romanian nationals to the UK labour market Migration Advisory Committee November 2011 Migration Advisory Committee 1st Floor Green Park House 29 Wellesley Road Croydon CR0 2AJ www.ukba.homeoffice.gov.uk/mac email: [email protected] Review of the transitional restrictions on access of Bulgarian and Romanian nationals to the UK labour market Migration Advisory Committee November 2011 Contents Contents The Migration Advisory Committee and secretariat ......................................................... 1 Chapter 1 Introduction ................................................................................................. 3 1.1 The Migration Advisory Committee ....................................................................3 1.2 Our task .............................................................................................................3 1.3 Background .......................................................................................................4 1.4 Our approach .....................................................................................................7 1.5 How we gathered evidence ...............................................................................8 1.6 Other issues ......................................................................................................9 1.7 Structure of this report ..................................................................................... 12 1.8 Thank you ........................................................................................................ 12 Chapter 2 Policy Context .......................................................................................... 13 2.1 Introduction ...................................................................................................... 13 2.2 Rights to residence in the UK for Bulgarian and Romanian nationals ............. 13 2.3 Rights to employment in the UK for Bulgarian and Romanian nationals ......... 14 2.4 Transitional restrictions imposed by other EU Member States ........................ 22 Chapter 3 Analysis of the UK labour market ............................................................. 25 3.1 Introduction ...................................................................................................... 25 3.2 The UK and global macro-economy and labour market .................................. 25 3.3 The causes and definition of a „serious labour market disturbance‟ ................ 36 Chapter 4 Analysis of labour market restrictions ....................................................... 41 4.1 Introduction ...................................................................................................... 41 4.2 The drivers and impacts of economic migration .............................................. 41 4.3 Economic, labour market and migration context in Bulgaria and Romania ..... 51 4.4 Bulgarian and Romanian nationals in the UK.................................................. 54 4.5 Possible impact of maintaining or removing the current labour market restrictions on Bulgarian and Romanian nationals ..................................................... 66 4.6 Concluding remarks ........................................................................................ 75 Chapter 5 Conclusions ............................................................................................. 77 5.1 Introduction ..................................................................................................... 77 5.2 Our commission .............................................................................................. 77 5.3 Existence or threat of a serious labour market disturbance ............................ 77 5.4 Effect on migration flows of lifting labour market restrictions on Bulgarian and Romanian nationals ................................................................................................... 78 5.5 Economic and labour market impacts of lifting labour market restrictions on Bulgarian and Romanian nationals ............................................................................ 79 5.6 Conclusions .................................................................................................... 79 Annex A Consultation ............................................................................................. 81 A.1 List of organisations / individuals that submitted evidence .............................. 81 A.2 List of organisations met with .......................................................................... 81 Annex B Summary of transitional restrictions imposed by ...................................... 83 B.1 Definitions ....................................................................................................... 83 Abbreviations ................................................................................................................ 87 References ................................................................................................................. 89 Chapter 1: Introduction The Migration Advisory Committee and secretariat The Migration Advisory Committee and secretariat UK Commission for Employment and Skills Chair Members representative Professor David Dr Diane Coyle OBE Dr Martin Ruhs Mark Spilsbury Metcalf CBE UK Border Agency representative Professor Jonathan Professor Rob Glyn Williams Wadsworth Wilson The secretariat Vanna Aldin; Samantha Allen; Anne Ball; Alex Barr; Jeremy Clarke; Ros Coles; Cordella Dawson; Stephen Earl; Emily Eisenstein; Mark Franks (head of secretariat); Jocelyn Goldthorp; Kathy Hennessy; Kyle Magee; Daniel Pease 1 Chapter 1: Introduction ChapterChapter 1 1 IntroductionIntroduction 1.1 The Migration Advisory to the Government‟s shortage Committee occupation list (Migration Advisory Committee, 2011b). 1.1 The Migration Advisory In a report that is being Committee (MAC) is a non- published alongside this one, departmental public body we have advised on what comprised of economists and would be the likely economic migration experts that impact of restricting or provides transparent, removing settlement rights independent and evidence- under Tier 1 and Tier 2 of the based advice to the PBS. Government on migration issues. The questions we 1.2 Our task address are determined by the Government. 1.3 The UK Government is obliged by EU law to notify the 1.2 Previously, we have provided European Commission if it advice on the design of Tier 1 intends to maintain labour and Tier 2 of the Points Based market restrictions on System (PBS) for managed nationals of Bulgaria and migration (Migration Advisory Romania (the so-called „A2‟ Committee, 2009a and countries) beyond the 2009b), the transitional labour beginning of January 2012. In market access for citizens of May 2011, the Government new European Union (EU) asked that we consider, by accession states (Migration October 2011, the following Advisory Committee, 2008) question: and the first annual limits on Tier 1 and Tier 2 of the PBS “Is there a serious (Migration Advisory disturbance, or threat of such Committee, 2010). In early a disturbance, to the UK 2011, we provided advice on labour market and would occupations and job titles maintaining the existing skilled to National restrictions on Bulgarian and Qualifications Framework Romanian nationals‟ access to level 4 and above for Tier 2 of the labour market assist in the PBS (Migration Advisory addressing any such Committee, 2011a) and disturbance or threat?” recommended amendments 3 A2 labour market restrictions 1.3 Background acceded to the EU in 2007 and are known as the „A2‟. All 1.4 The EU consists of 27 EU countries are members of countries: the 15 Member the European Economic Area States before enlargement in (EEA), together with some 2004 known as the EU15 countries not in the EU. A full (which includes the UK); the breakdown of EU and EEA „A10‟ countries that acceded Member States is provided in to the EU in 2004 and consist Box 1.1 below. of Cyprus and Malta and the eight „A8‟ countries; and Bulgaria and Romania, which 4 Chapter 1: Introduction Box 1.1 Breakdown of European Union and European Economic Area Member States The „EU15‟ comprises: Austria; Belgium; Denmark; Finland; France; Germany; Greece; Ireland; Italy; Luxembourg; Netherlands; Portugal; Spain; Sweden; and United Kingdom. The „A10‟ countries are: Cyprus; Czech Republic; Estonia; Hungary; Latvia; Lithuania; Malta; Poland; Slovakia; and Slovenia. The „A8‟ countries are all of the above excluding Cyprus and Malta. The „A2‟ countries are: Bulgaria; and Romania. All of the above countries are members of the EEA. The following countries are members of the EEA but not the EU: Iceland; Liechtenstein; and Norway. Switzerland is not in the EEA, but its nationals are subject to the same immigration control processes as those for EEA countries. References to policy in relation to EEA (non-EEA) nationals in this report therefore include (exclude) Switzerland. 5 A2 labour market restrictions 1.5 The Treaty of Accession 2003 labour market on the same was the agreement between terms as other EU nationals the EU and the A10 countries (except Bulgarian and governing the accession of Romanian nationals). the latter into the EU. The Treaty allowed existing EU 1.8 The UK decided to restrict members to impose access to its labour market to transitional restrictions on the nationals
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