East Europe worker influx a boon for Far Right

VIENNA Tue Apr 19, 2011 8:11am EDT

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VIENNA (Reuters) - An influx of eastern European workers to Austria and Germany once visa barriers fall on May 1 could not come at a better time for Heinz-Christian Strache.

The leader of Austria's far-right Freedom Party and like-minded populists in Germany are set to make political hay from the move finally to open the two countries' borders to workers from countries that joined the European Union in 2004.

With fears of slipping living standards boosting rightist parties across Europe, Strache bucks the political mainstream by saying the border should stay shut until living standards in the new EU members reach at least 80 percent of Austrian levels.

"This is going to lead to massive aggravation and a process of displacement on the labor market," he told Reuters, citing the example of Britain, where from 2004 to 2010 the number of foreigners grew by 1.4 million to 4.4 million.

"If you go into a pub in England you hardly meet any English any more, only Polish waiters and what not," said Strache, whose opposition party ranks first or second in opinion polls before elections due in 2013.

He accused the government of deliberately understating the size of the expected influx and insisted that immigration could not be the solution to skilled labor shortages, which he called a home-made problem arising from companies' lack of training.

Germany's far smaller extreme-right NDP party -- which unlike Strache has no chance of governing any time soon -- takes the same hard line. "Germany is not a land of immigration and never can be allowed to be," it says, adding darkly: "We will not watch this development in silence."

SORE SUBJECT

A Makam opinion poll last month found Austrians evenly split over whether opening the labor market was a good idea, but 70 percent feared the foreign population would rise and 45 percent -- mostly those with less education -- expected a run on jobs.

"I think a lot of (eastern European) people will come, many have already come here and also to Germany, and they will accept work for less money, and the quality will go down because of that, and this will more or less ruin our whole system," grumbled unemployed truck driver Willi Malli, 26, of Vienna.

"I am not happy with the way this whole issue has been handled by our government and the EU."

Britain and Ireland were among the first to open labor markets fully to the new member states, and both saw a surge in immigration and a higher economic growth rate.

Now gains by right-wing parties across Europe are making immigrants a sore subject for countries struggling with high unemployment, tight budgets and thousands of refugees fleeing unrest in northern Africa.

Tensions have already spilled over, with France expelling thousands of Roma migrants and Italy pushing through laws that let authorities fine and imprison illegal immigrants and punish people who shelter them.

Concerns about fraud prevented Romania and Bulgaria from joining Europe's borderless travel zone as hoped last month.

Officials play down the prospect of trouble when Germany and Austria open their labor markets for Poles, Czechs, Hungarians, Estonians, Latvians, Lithuanians, Slovaks and Slovenes.

"We expect an additional 20,000 to 25,000 will try to enter the Austrian labor market," Labor and Social Affairs Minister Rudolf Hundstorfer told reporters last month.

"This really is not going to be a dramatic topic. Why? Because the East is already here."

He cited data showing 29,000 workers from Hungary, 16,000 from Poland and 17,000 from Romania were already in the country, a presence dwarfed by the 85,000 workers from Germany.

"I won't deny that there can be and probably will be problems, partly in construction, partly in tourism. But it won't be dramatic," he said, noting Hungarians already held 10 percent of the jobs in the eastern province of Burgenland.

CHECKS AND BALANCES

Mark Allen, the International Monetary Fund's senior representative in central and eastern Europe, took a similar line given the mood in Warsaw, where he is based.

"The view at the moment is that it is really unlikely to be a flood. Over time it may increase but there are a lot of Poles -- and I suspect that is true of all the other countries in the region -- actually already working in these countries," he told a conference in Vienna last month.

Even labor leaders play down the issue, noting that Austria -- whose economic output per capita is a quarter above the EU average -- has adopted laws against so-called "wage dumping" that require foreign workers to get the same pay as locals.

The trick will be ensuring that eastern European employers who send staff to Austria respect the rules, said Walter Sauer, an official at the Austrian trade union confederation.

"The authorities in Poland, the Czech Republic or Hungary in the end have to check whether the workers are getting paid as they should and if the authorities there don't function well it is a problem," he said.

(Additional reporting by Sasa Kavic, Brian Rohan in Berlin and Michael Winfrey in Prague; editing by Paul Taylor)

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