The COVID pandemic and working abroad

Closed borders as a result of the COVID pandemic: Professor Matthias Lücke from the Kiel Institute for the World Economy Kiel is examining the influence of COVID on migrant workers abroad in eastern Europe. *

Three workers on a construction site
© iStock/Bulga

Migrant labor is used especially in construction in Eastern Europe.

Life has been paralysed by a virus: COVID-19 caused a global lockdown in 2020. Businesses closed, whole industries shut down, individual countries were sealed off through border closures. This affected the global economy – and the workers who keep it running. This includes people from eastern Europe and central Asia, who sometimes work in Russia as farm hands, carers or shop assistants. How have restrictions on movement and mobility affected migrant workers there? This is the question being considered by Dr Matthias Lücke, senior researcher at Kiel Institute for the World Economy and expert on international migration.

The authority on eastern Europe asserts that there have been astonishingly few decisive changes around the world. This is because, despite closed borders for tourist travel, goods transport continued between most countries, explained the honorary professor at Kiel University’s Faculty of Business, Economics and Social Sciences. Most workers were also able to travel, if need be, spending some time in quarantine. "Apart from during the first few months of the pandemic, migrant workers in Russia had very little difficulty travelling to work and back to their country of origin." Likewise, harvest workers continued to travel to Germany, along with migrant workers who, for example, work in slaughter houses and in food processing.

Lücke particularly looked at the long-term employment relationships of people who work in Russia for several months at a time but whose home, household and family are in Moldova, Uzbekistan or Ukraine. "There is a lot of temporary migration, especially from rural areas and small towns and cities in eastern Europe, to the high-wage country of Russia because there is work there and it is better paid than at home." The money is used to support the family who continues to live relatively cheaply at home.

Bank transfers home served the expert as an important source of information in investigating his hypothesis. Lücke was also able to refer to the usual surveys of households and workplaces in Russia as well as immigration statistics. "It was often unclear how much of the surveyed information was true, though," said Lücke. The money transfers as per the balance of payments seemed to be a robust source of information, even though amounts taken home in cash can only be estimated in part.

In Moldova, the remittances of migrant workers currently make up 16 percent of the gross domestic product (GDP).

Matthias Lücke

According to Lücke, remittances by migrants to countries with low or middle incomes fell only slightly (by 1.7 percent) between 2019 and 2020. In 2021, they recovered and even increased by 7.3 percent. The situation was similar in Moldova and Ukraine, while in Uzbekistan money transfers received fell by 18 percent in 2020 and only partially recovered from this setback in 2021.

The reason for this, explained the expert, is probably the type of jobs involved: "Migrant workers are often found in essential industries like nursing care or construction. The work continued during the crisis as people were needed. Those who lost their job in other sectors found a new one here. For this reason, travel exemptions applied during the COVID crisis." This was not only good for the Russian economy, but also for the economies of the home countries. "In Moldova, the remittances of migrant workers currently make up 16 percent of the gross domestic product (GDP); in the mid 2000s, they were equivalent to up to a third of GDP. In Uzbekistan, the two to three million migrant workers provide family income worth a good twelve percent of domestic GDP and in Ukraine, remittances still make up a tenth of GDP. Work and income abroad are an economic anchor, especially for many smaller countries of origin."

Lücke concludes: COVID has had only a limited impact on the number of migrant workers. Political crises, such as between Ukraine and Russia over the last ten years, have had greater consequences. Since Russia annexed the Crimea in 2014, only very few Ukrainian workers remain in Russia, while around two million people from Ukraine work in Poland. "How the situation will develop for migrant workers in Russia remains to be seen, in view of the financial sanctions and looming economic crisis."

Author: Jennifer Ruske

* This article refers to the situation prior to Russia's attack on Ukraine.