(Sanitized) ER 78-10472 AND ER 78-10455

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80T00702A000200080002-9
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 14
• Document Creation Date: December 12, 2016
• Document Release Date: July 22, 2002
• Sequence Number: 2
• Publication Date: February 5, 1979
• Content Type: MF

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 National Confidential
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Assessment
Center
Foreign Workers in
Western Europe: A Major
Economic Factor
Confidential
ER 78-10472
August 1978
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Foreign Workers in Western Europe:
A Major Economic Factor
Central Intelligence Agency
National Foreign Assessment Center
Summary
Nearly 8 million foreign workers remain in Western Europe. Following a
net exodus of 1 million to 1.5 million, touched off by the 1974-75 recession,
departures have now slowed to a trickle. Foreign workers now represent just
under 9 percent of the West European labor force, and their number should
stabilize slightly below the present level over the next few years.
Most foreign workers migrate from southern Europe, Turkey, and North
Africa to the industrial centers of Northern Europe.* They are employed in
almost all economic sectors but are recruited primarily to fill the unskilled,
dirty, or menial jobs nationals often will not take. They are a primary source
of labor in construction, metal processing, sanitation, domestic service,
tourism, and food service. Historically they have functioned as a safety valve
for the labor-importing countries, their numbers expanding and contracting in
response to market conditions. In good times, their emigration also has
relieved economic, social, and political pressures in the exporting countries.
By and large, the foreign workers still have not been integrated into the
domestic labor forces or the social fabric of Northern Europe. Notwithstand-
ing various programs intended to help the foreign worker and his family,
social problems have been aggravated over the years by the arrival of more
families and by the higher birth rate among foreigners. Most immigrants
remain in social and cultural isolation in the poorest sections of large cities.
Recovery from the recession in the labor-importing countries-West
Germany, France, the United Kingdom, Switzerland, Austria, Sweden, and
the Benelux countries-has been disappointing. The modest economic growth
* For this paper Northern Europe consists of those countries in the European Community and
Switzerland, Austria, Sweden, and Norway.
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likely in Western Europe in the next few years will not reduce joblessness.
Thus Northern governments will be under pressure to maintain existing
restrictions on immigration and the employment of foreigners.
The net return from Northern Europe of hundreds of thousands of
migrant workers since 1973 has aggravated economic; and social problems in
the labor-supplying countries. The return of workers, combined with a
reduction in the amount of surplus labor normally accomplished by emigra-
tion, has swelled already high unemployment in :Italy, Portugal, Spain,
Turkey, and Yugoslavia. During the recession a marked reduction of worker
remittances, a primary source of foreign exchange, contributed to record
deficits for most labor-supplying countries. Remittaces are now recovering,
but they are unlikely to resume growth at prerecession rates at least for the
next several years.
ii
CONFIDENTIAL
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Foreign Workers in Western Europe:
A Major Economic Factor
Nearly 8 million foreign workers remain in
Northern Europe despite the persistence of ab-
normally high unemployment since the 1974-75
recession. Foreign workers constitute just under
9 percent of the labor force of the area, down a
percentage point or two from the prerecession
high. Migrants make up 12 percent of the work
force in Switzerland, 9.5 percent in West Ger-
many, 7 percent in France, and 6 percent in
Austria. They account for a much larger percent-
age of unskilled workers and are especially
'important in certain industries-for example,
automobile manufacturing and other metal pro-
cessing, sanitation, food service, and tourism. In
construction and domestic service, they are the
main source of labor.
Foreign workers, primarily from less pros-
perous countries to the south, have played an
important role in the economies of Northern
Europe since the 1950s. These people-the so-
called guest workers-in large measure satisfied
burgeoning demand for unskilled labor in the
advanced economies. The savings they sent home
boosted personal incomes and provided the labor-
exporting countries with much-needed foreign
exchange.
The guest workers have functioned as a safety
valve for the Northern economies, their numbers
expanding and contracting in response to market
conditions. In expansionary periods, the lure of
high wages has attracted an influx of migrants.
In times of recession, lack of work and tighter
immigration controls have caused a sizable net
flow of labor back to the countries of origin.
After an outflow of workers during the 1966-67
recession, the movement of foreign workers to
the north resumed and exceeded previous levels.
The 1974-75 recession triggered another exodus.
A net of from 1 million to 1.5 million foreign
workers returned to their homelands between
1973 and 1976, including 500,000 from West
Germany and 300,000 from Switzerland (see the
table). The cyclical flows of guest workers have
no precise counterpart in the United States and
partially explain why unemployment rates do not
rise as much in Western Europe as in the United
States when production drops.
Most of Northern Europe's foreign workers
come from Italy, Portugal, Spain, Greece, Tur-
key, and Yugoslavia. North Africa-Algeria,
Morocco, and Tunisia-is also an important
source of labor, especially for France. A major
exception to the pattern is the United Kingdom,
where more than 80 percent of the foreign labor
comes from Ireland and English-speaking coun-
tries in the Commonwealth. West Germany,
France, Switzerland, and Austria employ the
most southerners, but large numbers also work in
the Benelux and Scandinavian countries.
Social Problems
On the Continent, foreign workers generally
have not been integrated into the domestic labor
forces or the social fabric. Host countries have
Selected Labor-Importing Countries: Foreign Workers'
Thousand Persons
1973
2,479
621
226
222
1974
2,397
551
218
235
1975 ..
2,212
425
185
251
1976
2,034
342
174
267
1977
1,975
320
189
N. A.
' Complete and uniform statistics on foreign workers in Western
Europe are not available. Some countries do not report data on
foreign workers and those which do use different methods of
classifying them. For example, some countries include seasonal
workers in their reporting, while others do not. Data are also
inadequate on daily international commuters, Common Market
migrants who cross member state borders freely, illegal immigra-
tion, and those who enter a country as visitors but stay to take
temporary employment. France probably hosted 1.5 million to 1.9
million foreign workers throughout the period dispite some decline
after 1974.
2 Excluding aliens with residence permits.
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traditionally regarded them as transients. Re-
quirements for work permits tie workers to cer-
tain jobs. Other restrictions on job mobility,
requirements to renew work and residence per-
mits periodically, and in some cases rules inhibit-
ing the reunion of families have discouraged
permanent settlement. Finally, discrimination
and prejudice, present in varying degrees in all
the labor-importing countries, discourage inte-
gration and make social adjustments difficult.
Latent resentment against the guest worker be-
comes open mainly in times of recession or
unemployment.
The foreign workers themselves tend to resist
assimilation into their host societies. The typical
foreign worker, who is likely to be young, male,
and single or at least traveling alone, plans to
return to his homeland in just a few years after
profiting from experience, skills, and wages
picked up abroad. (In reality, many remain year
after year.) He has little interest in pursuing
lengthy language or even vocational training. He
associates almost exclusively with his own coun-
trymen and remains uninvolved in union or po-
litical activities.
Most guest workers have been recruited to fill
jobs vacated by indigenous workers moving up
the economic ladder. Their own prospects for
advancement are very limited. Vocational train-
ing is inadequate in most cases, although some
firms with government support-particularly in
West Germany and Switzerland-offer high
quality courses in industrial mechanics. Lan-
guage instruction, except in Sweden or in France
where government paid instructors are readily
available, is even more haphazard and is often
left to the foreign workers' own initiative. Only
one-fifth of the foreigners in West Germany
speak acceptable German; an estimated 15 per-
cent of the men are able to write German.
As for housing, most employers are, at least
initially, required by law to provide adequate
accommodations or show that such are available.
Nevertheless, the foreign workers-motivated by
desire to save as much money as possible, associ-
ate with their own countrymen and live near
their places of work-tend to form ethnic en-
claves in the ~)oorest neighborhoods. Single guest
workers are frequently put up in publicly fi-
nanced hostels, especially in France and West
Germany. In the private housing market, for-
eigners often; encounter discrimination and find
themselves lip'ing in substandard conditions.
The educai.ional needs of those guest workers
who bring their families to continental countries
pose especially serious social problems. The edu-
cational facile ties in the areas where most foreign
workers live! tend to be overcrowded or inad-
equate to begin with. Given the strong allegiance
of Mediterrtean peoples to their cultural heri-
tage, many !refuse to avail themselves of the
educational and other programs offered by host
governments. Immigrant children who are en-
rolled in a local educational system struggle with
the new languiage and culture. Many fall behind
their age groups or drop out. In West Germany,
more than (,0 percent of immigrant children
leave school before earning completion certifi-
cates or diphomas.
As the guest worker phenomenon has per-
sisted, the gradual arrival of more families and
the relatively' high birth rate among migrant
worker families are making educational, housing,
and other so,:.ial problems more acute. Depen-
dents now ac;count for one-third to more than
one-half of foreigners in the various host coun-
tries. Belgiuili has almost as many foreign chil-
dren as foreign workers. In West Germany 20
percent of all births were to foreigners in 1976;
600,000 foreign births have been recorded since
1970. Many: immigrant children now are old
enough to work. West Germany alone has
210,000 immigrant children between the ages of
15 and 20 and almost as many aged 10 to 15. Job
seekers in this subgroup are finding the double
disadvantage of being young and foreign an
almost insur> countable obstacle. Moreover, fam-
ily members who have recently entered West
Germany or France are prohibited from taking
work. Many work illegally.
The number of illegal residents in the Euro-
pean Community (EC), Austria, and Switzer-
land is estimated at about 1 million. The number
is growing o~.s host countries respond to labor
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market slack by trying to decrease the number of
foreign workers by making registration more
difficult. Most illegals are persons who are un-
able for various reasons to get work permits or
renew old ones. Some came in as visitors, stu-
dents, or dependents and remained to work with-
out permits. Still others initially entered their
host countries illegally. Smuggling organizations
operate in all the major labor-importing coun-
tries, extracting large fees from aliens for helping
them evade immigration restrictions. The illegal
resident lives an underground existence, hiding
from the authorities and often working for lower
wages and without any kind of government-
provided social benefits. Laws and penalties on
illegals vary from country to country. Officials of
the European Community are working on plans
aimed at tightening and., coordinating legislation
in member states on illegal immigration.
Impact of Foreign Workers on Labor Cost
The availability of large numbers of foreign
workers probably has slowed wage increases in
Northern Europe, particularly increases in the
wages of unskilled and semiskilled workers.
Without immigration, employers undoubtedly
would have to pay more to attract nationals to
jobs where immigrants are paid the statutory or
customary minimum wage and illegals often
work for less.
Similarly, the employment of foreign workers
probably has slowed the growth of labor produc-
tivity, or output per worker. It reduces the
capital to labor ratio and fosters the continuation
of relatively labor-intensive modes of production.
While immigrants are considered hard workers,
the same factors that hold down their earnings-
their sheer numbers, limited education, lack of
job skills, and language problems, as well as
discrimination-hold down their productivity.
Declining Demand for Foreign Labor
Western Europe's recovery from the 1974-75
recession has been sluggish. Unemployment rates
remain high almost everywhere, and in most
countries continue to creep up. Real GNP
growth in the next few years will be inadequate
to lower overall joblessness appreciably. Not
surprisingly, immigrant labor has been a target
of far-reaching restrictions aimed at protecting
indigenous workers:
? West Germany, France, Belgium, Denmark,
and Luxembourg have banned recruitment of
labor from outside the EC.
? West Germany and France have stiffened
penalties for smuggling in or hiring illegal
immigrants.
? West Germany has prohibited non-EC mi-
grants from moving to areas where such
people already make up more than 12 percent
of the population.
? Switzerland has directed that nationals be
given preference in filling job vacancies and
that foreign workers be the first to be laid off.
? The Netherlands has put a ceiling on immi-
gration of non-EC workers and the number
each firm may hire.
? Switzerland has placed a limit on the total
immigrant population and has reduced the
number of work permits issued annually even
though it enjoys an exceptionally low unem-
ployment rate.
Legal impediments to the recruitment of for-
eign workers, combined with the impact of reces-
sion on construction and other industries that
offer the largest number of job opportunities for
migrants, have sharply reduced demand for for-
eign labor. Unemployment among foreign wokers
rose much faster than the jobless rates for na-
tionals in 1974-75 despite a swing to net emigra-
tion. Foreign workers are the first to be fired not
only because of their concentration in highly
cyclical industries but also because of their posi-
tion at the bottom of the skill and seniority
ladder and outright discrimination. Unemploy-
ment among guest workers has receded some but
remains above prerecession levels and much
higher than the rates for nationals in France, the
Netherlands, and Sweden. In West Germany,
Switzerland, and Austria, unemployment rates
for foreigners have come down near the levels for
nationals.
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The mass exodus of guest workers induced by
the 1974-75 recession is over. Departures slowed
to a trickle in 1977. In West Germany the
number of guest workers was down only about
60,000 in 1977-less than one-third of the reduc-
tion in each of the previous two years. The
average number of foreign workers in Switzer-
land declined by only about 20,000 after plum-
meting an average of about 95,000 each year
from 1973 to 1976. The number of foreign
workers in Austria actually increased last year.
France, like most of the labor importers, has
watched the outflow of a portion of its foreign
work force with mixed emotions. The departure
of the foreign workers relieves unemployment,
but the availability of low-cost foreign labor is
very important to the French economy. Foreign-
ers make up some 20 percent of the manual work
force and are especially important in the petro-
chemical, automobile, and construction indus-
tries. On French construction sites, 40 to 80
percent of the workers are usually North Afri-
can, Spanish, or Portuguese. Some Renault as-
sembly lines are almost exclusively manned by
guest workers. French business leaders have ex-
pressed fear that prices would jump should many
of the immigrants working at the minimum wage
depart. Although Paris banned new recruitment
of labor from outside the EC in 1974, it aimed at
retaining the bulk of the foreign work force
already in France.
From a high of 1.9 million in 1974-75, the
number of foreign workers in France probably
has declined by several hundred thousand due to
the recruitment ban and the recession. The per-
sistence of high unemployment, with foreigners
constituting 10 percent of the jobless, has
prompted Paris to place a temporary ban on new
work permits for non-EC foreigners already in
France and on the immigration of dependents.
Furthermore, non-EC immigrant workers have
been offered $2,000 bonuses and one-way air
tickets to return to their homelands. These meas-
ures-already softened by exempting the largest
national group, the Portuguese-are aimed pri-
marily at the 100,000 jobless foreigners.
Integration Policies in Northern Europe
Programs to integrate the guest workers vary
widely from country to country, and results have
been uneven at best. The meager funding typi-
cally allocated, such efforts is indicative of their
limited scope. Most programs focus on providing
information and counseling on jobs, housing, and
schools. West' Germany has set up day care
centers, youth clubs, and special schools for
immigrant children in urban areas where for-
eigners are concentrated. Bonn is also allocating
about $12 million annually to subsidize private
services for immigrants such as language and
vocational training, legal aid, and social assist-
ance. Paris has allocated funds for expanded
language and, vocational training and passed
legislation aimed at easing discrimination
against foreigners at work and in union activities.
Sweden's efforts to integrate foreign workers
into the host economy and culture have been the
most far reaching. Foreign workers are entitled
to permanent residence permits after only one
year. They traditionally have been extended the
same social rights and benefits as nationals,
including educational and medical benefits. In
1976 Sweden became the first country to grant
all foreigners the right to vote as well as the right
to run for local and regional office. In the United
Kingdom, resjdent citizens of independent Com-
monwealth countries are British subjects and
enjoy full poli.ical and civil rights. London tight-
ened controls on immigration in 1962 and 1968
but still permiits free entry of immigrants from
colonies and Commonwealth countries that have
specified links to the United Kingdom.
The EC established free movement of labor in
1968. Nationals of EC countries are entitled to
equal treatmt;nt by employers anywhere in the
Community ?ind to preference over non-EC
workers in H ring. The EC Commission has
recommended a program to extend equal treat-
ment to non EC workers and to expand and
standardize the assistance to all foreign workers.
Community financing is available from the Eu-
ropean Social Fund for member country projects
on behalf of migrant workers; some $24 million
will be provided this year. The principle of free
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movement of labor now is a major stumbling
block in consideration of Community member-
ship for Greece, Spain, and Portugal. With un-
employment already a serious and persistent
problem in the Nine, accession of these countries
is likely to be tied to restrictions on the move-
ment of their workers.
Few political parties in Northern Europe have
been inclined to exploit the guest worker problem
as a political issue.
Foreign workers, for their part, generally have
shunned political involvement. They often are
unaware of their rights and reluctant to complain
for fear of triggering further restrictions. Unem-
ployed guest workers have staged scattered small
demonstrations, but for the most part, host gov-
ernments have not been faced with serious
protests.
Labor unions, while fearful of large-scale im-
migration, generally favor equal treatment for
foreign workers already in place, especially equal
pay. They no doubt reason that a wage differen-
tial would give foreign job applicants an edge
and depress the wages of nationals. Union mem-
bership is relatively low among foreign workers,
and those foreigners who are in unions usually
are underrepresented in the higher echelons. As a
result, the unions have tended to defend immi-
grants' interests only where they coincided with
interests of indigenous workers:
The governments of some labor-exporting
countries have intervened directly with host
country governments on behalf of their expatri-
ates. President Tito has repeatedly asked for
more social security benefits and job security for
Yugoslavs working in Northern Europe and for
resettlement aid to those returning home. Several
Arab states are pressing the North European
governments to grant more apprenticeships to
teenage dependents of foreign workers. Rome
wants to establish a standard work contract for
its citizens abroad to stem what it regards as
exploitation. Portugal pressed for and won more
liberal social security provisions and a nondiscri-
mination clause for its workers in the EC. Tur-
key has been particularly aggressive in pursuing
benefits for its workers abroad. Ankara's Minis-
try of Labor has some 200 permanent represen-
tatives abroad serving the interests of Turkish
workers and has sent special emissaries to negoti-
ate expanded social benefits for Turks. Notwith-
standing Ankara's efforts, the EC has resisted
moving toward free entry for Turkish workers by
1985 as provided in Turkey's association treaty
with the EC.
Economic Implications for Labor Supplying
Countries
Emigration has traditionally siphoned off the
surplus manpower of the southern countries,
easing strains on domestic labor markets and
keeping unemployment down. The net return of
hundreds of thousands of migrant workers over
the past few years, most without significantly
increased skills, has exacerbated already severe
unemployment problems in these countries. Por-
tugal's problems were compounded by the
massive inflow of repatriates from Angola and
Mozambique. Unemployment has skyrocketed in
Portugal to 12 to 15 percent, compared with 2 to
3 percent in the early 1970s. About 250,000
Yugoslavs have returned home since 1973, and
they are the principal factor in the rise of
unemployment in their homeland. Unemploy-
ment is also high and rising in Italy, Spain, and
Turkey. The impact of growing joblessness on
incomes is particularly acute in Turkey, which
has no formal unemployment compensation
scheme to assist either laid-off domestic workers
or those returning from abroad. Greece, Italy,
Portugal, Spain, and Yugoslavia provide benefits
to workers laid off at home, but only in Italy do
workers returning from abroad qualify for
assistance.
Workers abroad still represent a sizable pro-
portion of the labor forces of the south European
countries (see the figure). They account for 15
percent of the Portuguese labor force and 8
percent of the Yugoslav. The corresponding
shares for Greece, Italy, Spain, and Turkey
range from 4 to 7 percent.
Worker remittances to most labor-supplying
countries, after years of steady growth, suffered
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Importance of Foreign
Workers to Labor-Exporting Countries
Remittances as a share
of 1977 current
account receipts
Italy Yugoslavia Turkey
*Data are for 1976.
`Portugal
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a marked reduction with the recession. The
decline in remittances coincided with widening
trade deficits, caused in large part by the soaring
cost of imported oil. The result has been substan-
tial current account deficits in most south Euro-
pean countries. The largest drop was in Turkish
worker remittances, which had kept Turkey's
current account balance in the black in the early
1970s; they fell by 30 percent in 1975-76 contri-
buting to a major payments crisis. Worker remit-
tances continued to increase only in Yugoslavia
but not enough to permit Belgrade to avoid
record deficits.
In dollar terms, worker remittances are recov-
ering smartly in most labor-supplying countries,
thanks to rising wages and exchange rate move-
ments. They represent about one-third of current
account receipts for Turkey and Portugal, about
20 percent for Yugoslavia, and 17 percent for
Greece. Not all of the savings of foreign workers
are remitted home. Turkish workers, for exam-
ple, hold some 5 billion deutsche marks in
German banks. All the major labor-supplying
countries are adopting measures to attract more
of their workers' savings from abroad.
Policies on Workers Returning to Labor-Supply-
ing Countries
The governments of southern Europe, Turkey,
and North Africa are concerned about the return
of large numbers of emigrant workers and are
taking steps to ease their difficulties.
? The Greek employment service has estab-
lished offices at the border and in West
Germany, Belgium, and the Netherlands to
help returnees find jobs.
? Italy pays returning workers unemployment
benefits and other allowances and gives them
priority for publicly financed housing.
? Portugal has established a ministry-level in-
stitute to coordinate services for returning
nationals. Given Portugal's unemployment
problem, however, the institute is working
hard to encourage those abroad to stay there
and to stimulate new emigration.
? Turkey has concluded an agreement with
West Germany that coordinates training for
Turkish migrants before and after their re-
turn on the basis of Turkey's skill needs..
Ankara is also looking for new markets for its
surplus labor. Libya has taken 10,000 Turk-
ish workers and holds out the prospect of
taking more; substantial job opportunities
have also opened up in Saudia Arabia and
Kuwait.
Outlook-The North
The number of foreign workers in Western
Europe should stabilize over the next few years
at slightly below the current level of nearly 8
million. Further small reductions in the foreign
work forces of West Germany, Switzerland, Aus-
tria, and possibly Norway and the United King-
dom are expected. Only moderate economic
growth is forecast for Western Europe, coupled
with a faster rise in the working-age population.
Hence labor markets will remain soft. Northern
governments will want to retain existing adminis-
trative measures aimed at discouraging new in-
flows of labor, but pressure to expand the EC is
working in the opposite direction.
Over the longer term, from 1985 onward,
growth of the working population in Western
Europe will fall off sharply. Expanding demand
for foreign labor is possible, although higher
energy prices are likely to hold down economic
growth. Demand for foreigners will be especially
weak if the long-term trend toward elimination
of socially undesirable, unskilled jobs at the
bottom of the labor ladder continues.
Most host country governments probably will
step up efforts to assimilate 'the foreign worker
and his family, recognizing that their presence is
not a temporary phenomenon. Measures on spe-
cial education, legal and housing aid, wider
dissemination of information on available pro-
grams and benefits, and coordination of national
and local agencies' efforts on behalf of migrants
will become more effective as the total number of
foreign workers stabilizes. Natural integrating
factors-lengthening of the time that some for-
eigners have been present, occurrence of more
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mixed marriages and naturalizations, entry of
more families, and the maturing of children born
to immigrants in the host countries-will have an
even greater integrating impact.
Turnover among foreign workers, however,
will work against these factors, keeping most
immigrants in social and cultural isolation in the
poorest sections of Northern Europe's large
cities. In the main, foreigners will continue to
hold the most socially undesirable jobs at the
lowest pay with the least security. Host govern-
ments are unlikely to extend the vote to guest
workers in the near future or ease naturalization
requirements. Undercurrents of prejudice and
discrimination are always present. Other factors
that would work against assimilation are the
swing toward immigration from increasingly dis-
tant, more socially and ethnically different places
such as Pakistan, South Korea, and Africa south
of the Sahara, and an expected increase in
illegals.
Worker remittances are recovering in most
major labor-supplying countries and have al-
ready exceeded 1973 levels in Yugoslavia, Portu-
gal, and Grey:e. Nevertheless, remittances are
unlikely to grow at prerecession rates at least for
the next several years.
The return of workers from abroad, combined
with a reductil'on in the amount of surplus labor
normally siphoned off through migration, has
raised the nuriber of available workers in labor
supplying countries by 3 to 4 percentage points.
Except in Portugal-where unemployment seems
to have stabilised at around 12 to 15 percent of
the labor force-and Greece, jobless rates are
rising from already high levels ranging from 5.6
percent in Yugoslavia to perhaps 15 percent in
Turkey. Even ~o, most governments probably will
not feel com"Jelled to take major new steps
tailored to the needs of returning workers as long
as they continue to shun political activism.
Prospects in the South
The economic outlook for most of the labor-
supplying countries is bleak-a continuation of
slow growth, unemployment, inflation, and lack-
luster investment. Italy and Spain are likely to
experience continued slow growth of production
over the next few years, and Portugal will have
persistently high unemployment even if output
expands considerably. Turkey is forecasting zero
or even negative GNP growth in 1978; unem-
ployment will remain high there as well. Greece
alone has been able to sustain a high rate of
economic growth and low unemployment in the
last few years and should continue to perform
rather well.
In the long run, the process of industrialization
in the labor supplying countries will be a crucial
factor in determining the future of labor migra-
tion. The rate of population increase is higher in
the southern c~:)untries, suggesting that an excess
supply of labor- will be available for many years.
Southern Europe can absorb this excess only by
expanding its industrial plant. Capital invest-
ment from thy; North has assisted this process
and can continue to do so. As labor markets
continue slack: almost everywhere in coming
years, Northern governments may well decide
that developmental aid to the labor-supplying
countries is tPie key to relieving the social and
political press.llres generated in the North by
labor migration.
Approved For Release 2002/08/12 : CIA-RDP80T00702A000200080002-9
 Confidentialkpproved For Release 2002/08/12: CIA-RDP80T00702A000200080002-9
Confidential
Approved For Release 2002/08/12 : CIA-RDP80T00702A000200080002-9