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Prof. Timo Baas - University of Duisburg-Essen

Timo Baas is assistant professor for Macroeconomics at the University of Duisburg. His research focus is on job-search, matching, migration and the impact of labour market policies. From 2006 to 2012 he worked at the Institute of Employment Research and was responsible for research projects on intra-EU labour mobility, extra-EU migration and the impact of labour market policies. Being member of the Job-Mobility-Net he contributed to studies on the reform of EURES, youth unemployment and active LMPs. Before going to Duisburg-Essen, he taught at the Free University of Berlin (2005 – 2012), the University of Potsdam (2008-2009) and the University of Bamberg (2012).

“The impact of EU mobile citizens on the labour markets of Germany and other EU members”

The continued economic crisis has become a major test for the labor markets of individual member states. While labor market pressure is high in some, others experience high unemployment rates and firms that are reluctant to post vacancies. Labor mobility within the European Union has the potential to help ease these imbalances. Most economist, nevertheless doubt the existing of a common labor market that is able to increase economic stability. Even that labor mobility in the European Unions has increased significantly, it is still low compared to the United States, were during one year more than two percent of US-Americans move from one state to another compared to 0.2 per cent of EU-citizens.
This presentation shows recent mobility trends within the European Union, analyses the labor market effects and derives reasons for cyclical patterns of migration. Using several case studies, the medium-term impact of migration on labor markets and the economy is quantified and reasons for cyclical fluctuations during the last ten years are derived. The findings, indeed, imply that a common labor market already exists, as migrants choose the optimum location for the provision of labor based on business cycle fluctuations. This is surprising, as on the one hand wage differentials are high within the European Union making business cycle fluctuation. Income-maximizing migrants might not bother about the business cycle while deciding on the destination country. It is shown that migrants respond to preference, technology and, in some cases, exchange rate shocks. Labor market conditions that are affected by those shocks, seem to be more important than the rather stable income differential.