Introduction
This report was prepared at the request of the Croatia World Bank Country Office in the context of Croatia’s presidency of the Council of the European Union (EU) from January 1 to June 30, 2020.1 The findings were intended to inform preparatory meetings of the Council around the topic of skilled migration in the EU, but the meetings were suspended because of the COVID-19 (coronavirus) pandemic. Nonetheless, the report was completed with the aim to generate evidence and inform policy dialogue in other EU countries with active World Bank engagements (for example, Bulgaria, Poland, and Romania), for which the out-migration of skilled workers and tertiary-educated young cohorts is a particularly relevant phenomenon and often a matter of concern for policy makers and various stakeholders in the society. The report examines the migration trends, drivers, and impacts among skilled workers within the EU during the last two decades using original data analysis as well as an in-depth literature review. The study assesses the benefits and costs of skilled migration in the short run and the long run, and, while covering issues pertinent for both sending and receiving countries, it emphasizes the potential implications of a large outflow of highly qualified workers for the economies of the main sending regions. The audience for this work consists of policy makers in both migrant-sending and migrant-receiving EU member countries, EU institutions, and international organizations. On the basis of the analysis carried out, the report formulates policy recommendations with the aim of addressing the various costs that migration induces among groups within both migrant- sending and migrant-receiving regions and of improving cross-country coordination to better unlock the overall benefits of migration. Although Member States have experienced relatively rapid income convergence and economic integration since the EU’s enlargement, the EU is still characterized by persistent socioeconomic gaps across different regions along several dimensions. First are the labor market gaps arising from differences in wages and the quality of job opportunities, which are exacerbated by rapid t echnological change and the shifting nature of jobs. Second are the gaps in the stock of human capital caused by persistent differences in the quality and quantity of education available. Third are the gaps in welfare and social protection systems, and finally in the quality of institutions and governance. These gaps 1
