Spain Allowed to Cut Off Romanians from Its Labor Market

Pictured: Spain`s Prime Minister Jose Luis Rodriguez Zapatero. EPA/BGNES

The European Commission has approved an unprecedented use of a "safeguard clause" by Spain, allowing the latter to temporarily restrict the free movement of Romanian workers to the Spanish labor market.

Following a request from the Spanish authorities on 28th July 2011, the European Commission announced Thursday it granted permission to Spain to restrict its labor market to Romanian workers until 31 December 2012 "due to serious disturbances on its labor market."

This is the first time an EU member state that the "safeguard clause" has been invoked in the area of free movement of workers.

The request does not refer to migrant laborers from Bulgaria, and the EC statement makes no mention of Bulgarians, even though Bulgaria and Romania's citizens are usually treated similarly with respect to labor restrictions across the EU as the two countries were the last to join the EU in 2007.

"Spain has been hit very hard by the crisis. The unprecedented fall in GDP ( 3.9% between 2008 and 2010) has resulted in the highest unemployment rate in the EU, over 20% since May 2010. The continuous increase of Romanian residents in Spain and their high level of unemployment have had an impact on the capacity of Spain to absorb new inflows of workers," the EC said in a statement.

"This decision has been taken because of the very specific employment situation in Spain. As a rule, I am convinced that restricting the free movement of European workers is not the answer to high unemployment," L?szl? Andor, European Commissioner responsible for Employment, Social Affairs and Inclusion, is quoted as saying.

"We should rather focus on creating new job opportunities. From the start, Spain has always had a very open policy to workers from other countries, including the new Member States, which the Commission has always welcomed. However, the Commission understands why, at this particular juncture - because of the dramatic employment situation and the very complex financial environment - the Spanish authorities wish to step back from full free movement," Andor said further.

He reminded that the Spanish request was supported by factual evidence and the Accession Treaty did allow the re-imposition of temporary restrictive measures in such cases.

By implementing these changes, Spain would still remain more open to workers from new Member States than some other Member States, he pointed out.

"However, we hope this move will be limited in time as much as possible and an overall positive attitude towards free movement in Europe will continue to prevail. I continue to encourage Spain to reform its labor market and improve employment opportunities for young people, and I also call for greater efforts to enhance employment opportunities in Romania. Both countries need to use EU structural funds better in order to create jobs in a more robust way. This is what is necessary to make a long-term difference to the employment situation," the Commissioner thinks.

Spain's restrictions on Romanians will apply to activities in all sectors and regions. However, it will not affect Romanian nationals who are already active on the Spanish labor market.

The EC statement emphasizes that Spain is facing serious labor market disturbances, characterised by the highest unemployment rate in the EU (21% in June 2011, against 9.4% on average in the EU and 9.9% in the euro area) and a slow economic recovery (only 0.3% of GDP growth in the first quarter of 2011 in comparison to the previous quarter, against 0.8 % for the EU and the euro area).

Moreover, the analysis by the Commission has established that Romanian nationals living in Spain are strongly affected by unemployment, as 30% of them are unemployed. 191 400 Romanian citizens working in Spain were unemployed in the first quarter of 2011, i.e. the second highest number after Spanish nationals.

This number was only 80 100 three years earlier. In the same period, the number of employed Romanians fell by nearly 24 %. Despite a fall in the number of Romanian national coming to work in Spain in recent years, probably due to the economic recession, the inflow remains at high levels. The number of Romanian nationals usually resident in Spain has increased from 388 000 on 1 January 2006 to 823 000 on 1 January 2010.

As Spain had already opened its labor market to all EU-citizens, any restriction of the free movement of workers constitutes a derogation and can only be temporary. The European Commission vows to monitor closely the situation in Spain and will have the possibility of modifying or revoking the Decision at any time it sees fit.

In general, free movement of workers has had a positive economic impact at the European scale and has produced economic growth in the receiving countries. Recent estimates suggest that the long-term impact of the population flows between 2004 and 2009 on the GDP of the EU-15 was an extra 0.9%, the EC says.

The European Commission will now inform the Council of its decision and any Member State may request the Council to amend or annul the Commission's decision on the suspension of EU law within two working weeks.

The EC reminds that the Act of Accession of Romania to the European Union of 2005 sets out transitional arrangements for the free movement of persons. This implies that the free movement of workers may be deferred for a period of a maximum of seven years (until 31 December 2013). This period is divided into three distinct phases ("2-plus-3-plus-2"-years). The current second phase started on 1 January 2009 and will end on 31 December 2011.

Spain already liberalized access to its labor market for Bulgarian and Romanian workers and members of their families from the beginning of the second phase on 1 January 2009.

Therefore, Spain can only restrict the access of workers from Romania by invoking the so-called "safeguard clause". The safeguard clause gives a Member State the possibility to re-impose restrictions on free labor market access, if it is undergoing or foresees serious labor market disturbances.

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