LABOR OUTFLOWSFROM ALBANIAIn the light of the New Economics of Labor Migration

Marcin SenderskiUniversity of WarsawFaculty of Economic Sciences

Presented: 22 January 2010

A poor family is considered to be one that does not have a member who can emigrate abroad.

A respondent from the town of Gramshi De Soto H., Gordon P., Gedeshi I., Sinoimeri Z., Poverty in Albania. A

Qualitative Assessment, 2002.

Introduction with timelines Migration flows and their determinants Brain drain and other consequences for the

sending country Remittance flows Migration networks Theorization attempt and conclusions

No political, lawful (and even criminal) aspects, both for the sending and thereceiving countries

No deep insight into temporary migrationand internal migration which are alsoremarkable

No insight into impacts for the receivingcountries

Before 1944, to the USA and some LatinAmerican states. Economic push factorsresponsible.

Between 1945-1990, political factorsresponsible, also emigration of quislings, serious institutional barriers, so-called‘embassy migrants’.

After 1990, most significant, in the 1990s absence of governmental control of migration flows.

1990, July 2: Migrants’ Day. Issuing of passportswas liberalized.

1991: the boat exodus to Italy and the paralellmass migration to Greece.

1993-1996: migration stabilizes as the economygrows.

1997: mass migration following the ‘pyramidcrisis’.

1999: emigration following the Kosovo crisis. 2000 onwards: relative stability and

consolidation of emigrant communities abroad.

In the early 1990s (…) Albania quickly became the country with the highest migration outflow in Europe, when measured in terms of the ratio of migrants to overall population.

Albania's migration flow has (…) been five times higher than the average migration flow in developing countries.

Barjaba K., Albania: Looking Beyound Borders, August 2004

PUSH FACTORS

Poverty Unemployment Scarce access to medical

care Also extraordinary factors:

1997 collapse of variousfinancial pyramids, othershocks

PULL FACTORS

A will to experience an outside world (especiallyamong young people in theearly 1990s: ‘Hello Europe, I hope to find you well’ attitude)

Educational motivations Satisfying career interests

Migrants are younger than their counterparts whoremained in Albania

Migrants are predominantly men Households with migrants are bigger in size. However,

in the effect of migration, they become significantlysmaller

Migrant households are by far older, following themigration of the younger members

The access to a well-established network is a powerfuldeterminant favoring migration

Households with no migrants have a higher incidence of poverty (inverse causality?)

Educational levels and occupational profiles are similar

INTERNATIONAL MIGRANTS INTERNAL MIGRANTS

Geographical, cultural and linguisticproximity most important.

Italy and Greece in the 1990s, also Western European countries (Germany, Switzerland, United Kingdom).

Nowadays, USA and Canada more popular among the educated.

Studies show that once abroad, many highly educated emigrants do not work in their areas of specialization, including 74 percent in Greece, 67 percent in Italy, 58 percent in Austria, and 70 percent in the United States.(…) Albania's ‘brain drain’ is emerging as ‘brain waste’.

Barjaba K., Albania: Looking Beyound Borders, August 2004

Official estimates make remittances the largest source of foreign exchange, greater than the combined value of exports and foreign direct investment and constituting 14 percent of GDP.

International Monetary Fund, 2002.

Trade deficit amounts to more than 20% of GDP per year (2006).

Vullnetari J., Albanian Migration and Development: State of the Art Review, September 2007, p. 72.

Relationship to the head %

Spouse / partner 4

Son / daughter 55

Sister / brother 25

Other 12

Institution 3

Given the weakness of Albania’s banking system, remittances are mainly sent to the country through informal channels. The tendency to transfer money through banks has increased only in recent years, because of banking sector reforms and the decrease of emigrants’ visits to their families in Albania.

Objective %

No specific use 37

Basic necessities 33

Purchase of durable goods 12

Medical expenses 9

Others 9

The amounts sent are higher for households in ruralareas and increase with the distance of remitters. Remittances are of a significantly higher amount when specifically destined to fund investment (business or dwelling renovation) or the purchase of durable goods.

Considered moving abroad? Yes No

Number of observations 2730 7411

Percentage 27 73

Why not? %

Does not want to 31

Too difficult 30

No need 24

Too costly 9

Other 6

Tried to move and failed? %

Yes 44

No 56

Since every fifth Albanian lives abroad, almost one half of all Albanian households have access to migration networks.

They serve as a catalyst for the migration of family members of network migrants as well as community members at the point of origin.

Decision to migrate is a joint household decision (costs and benefits shared, coinsurance possible)

Relative deprivation (more important thanthe absolute wage differentials)

Migration networks as a catalyst for themigration

Migrants typically earn less

Main characteristics of Albanian migration An important constituent of coping strategy Both permanent and temporary (do not appear to be

complements), but long-term if permanent Inspired by push factors The existence of migration network and previous

experience with migration are key determinants as well

Remittances not improving the situation of domesticeconomy

Inhabitants of Tirana are less likely to migrateinternationally

Azzarri C., Carletto C., Modeling Migration Dynamics inAlbania: A Hazard Function Approach, 2009

Barjaba K., Albania: Looking Beyond Borders, August 2004 Barjaba K., Migration and Ethnicity in Albania: Synergies and

Interdependencies, 2004 Carletto C., Davis B., Stampini M., Trento S., Zezza A.,

Internal Mobility and International Migration in Albania, June2004

Çaro E., van Wissen L.J.G., Migration in the Albania of thepost-1990s: triggered by post-communist transformations and facilitator of socio-demographic changes, 2007

Vullnetari J., Albanian Migration and Development: State of the Art Review, September 2007

Central and Eastern European Online Library, www.ceeol.com Development Research Centre on Migration, Globalization &

Poverty, www.migrationdrc.org Food and Agriculture Organization of the United Nations,

www.fao.org Institute for Migration and Ethnic Studies, University of

Amsterdam, www.imiscoe.org Migration Policy Institute, www.migrationinformation.org Organisation for Economic Co-operation and Development,

www.oecd.org The World Bank, www.worldbank.org Watson Institute for International Studies,

www.watsoninstitute.org

Thank you for your attentionMarcin Senderski

msenderski@student.uw.edu.pl