A Sharp Departure

Over the last eight years, more than 10 million foreigners have immigrated to the European Union, plugging the gaps at the cheaper end of the labor market that an aging native population can no longer fill. More will certainly follow as the demographic crunch approaches. By midcentury a third of all Europeans will be retired, and demographers predict the EU will need another 20 million workers to fill that gap by 2030. But in the contest to attract the best brains, Europe is falling far behind. "Highly qualified" foreign workers now account for just 1.7 percent of a working population of 290 million people, according to the EU, barely half the rate for the United States and eight points behind Australia.

So now, in an effort to attract big brains from abroad, the European Commission wants to create an express line for the EU labor market. The plan would create a "blue card," inspired by the U.S. "green card," a renewable permit that would allow highly skilled workers and their families to move easily between member states and jobs. In time, cardholders would also qualify for permanent-resident status. "With the European blue card, we send a clear signal," European Commission President José Manuel Barroso said last year. "Highly skilled workers are welcome in the EU."

It's also a signal that the race to attract the world's best talent is picking up speed. For all the attention that has been focused on the rising obstacles to immigration into the United States, particularly since 9/11, the maze of barriers is even more daunting in the EU. Each of its 27 member states has a different set of rules, and immigrants who hope to move from one country to the next must navigate an entirely new system.

The blue card's proponents had hoped to streamline the complexities, and offer immigrants access to a continent-wide job market. But Europe's multilingual makeup puts it at a distinct disadvantage to the United States. While an Indian computer programmer with a green card can travel freely from one U.S. state to another with no linguistic difficulties, going from Britain to Germany is likely to be another story. "Language is always going to be the fly in the ointment," says Georges Lemaitre, at the Organization for Economic Cooperation and Development.

The EU also remains deeply divided over the touchy issue of immigration, with some of the largest states wary of any interference from Brussels. Britain was opposed to the scheme from the start. Austria, where foreigners account for 10 percent of the population, is uneasy at the prospect of more immigration. Germany has expressed doubts about encouraging incomers while its unemployment rate hovers around 8 percent. Unemployment is even higher in some Eastern and Central European nations, which are loath to see immigration rules eased when their own citizens are still denied open access to some of the EU's biggest economies, including France and Germany.

Responding to these criticisms, the Commission modified the blue-card plan. Cardholders and their families will still be able to move from country to country without returning home first, but EU member states will be able to impose their own quotas on migration, and cardholders will need to prove they have a job awaiting them before settling in another state. The blue card is "a good idea in principle, but the fine print gets in the way," says Jakob von Weizsäcker, an economist at the Brussels think tank Bruegel, which came up with the original blue-card proposal. "What we have now is just not enough to turn around Europe's poor performance."

Of course American businessmen make similar warnings. They say both the H-1B visa and the green card—the standard tickets into the U.S. job market for foreign professionals—are oversubscribed and expensive for employers. In 2007, the 85,000 H-1B visas were snapped up in a few months, at costs of up to $6,000. Backlogs in green-card applications often leave skilled workers in legal limbo for years. Microsoft's Bill Gates warned last year that such hurdles were shutting out "the world's best and brightest."

Still, Europe's obstacles may be harder to overcome. Perhaps the biggest issue is that Europe's heavily regulated business environment discourages migrants, says Steven D'Haeseleer of BusinessEurope, a Brussels group that represents EU employers. "The blue card would only have its full impact if it were introduced into a vibrant, wealth-creating economy," he says. "And at the moment that's much more the case in the United States." So at least when it comes to cards, it may be some time before blue is the new green.

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