As the global economic crisis leads to thousands of layoffs across Europe, one of the first victims has been the once-booming construction market. Across the continent, building projects have been shelved and construction firms have begun to reduce their workforce.
In response, authorities in the Czech Republic have adopted a novel approach to dealing with migrant workers who have lost their jobs in construction and other sectors. As of this week, Czech officials are offering free air tickets and 500 euros in cash to jobless migrants to allow them to return home.
Serhiy, a 24-year-old Ukrainian, is employed by a construction company in the Czech capital, Prague. He says the economic downturn has already meant a drop in his salary, and his company has begun downsizing its workforce.
Like thousands of migrants from Ukraine, Vietnam, Uzbekistan, and other countries, Serhiy works for minimal wages and receives no health insurance or social benefits.
Nowadays, he says he is making just enough money to pay for food and rent on the flat he shares with several other migrant workers in a Communist-era apartment block in Prague's working-class neighborhood of Repy.
According to the Czech media, the country hosts nearly 300,000 officially registered migrant workers, including some 84,000 Ukrainians. NGOs dealing with migrant issues, however, estimate that the real number of foreign laborers -- including thousands living in the country illegally -- is far higher.
With unemployment rates reaching nearly 7 percent in the Czech Republic, guest workers -- many of whom are involved in low-paid manual labor -- are facing greater competition and an increasing risk of losing their jobs.
No Rush To Return
The Czech Ministry of Home Affairs predicts that some 12,000 foreign workers will lose their jobs in the first quarter of 2009.
To assist migrants left with no accommodation or financial means to support themselves, Czech authorities have allocated nearly $3 million to help jobless foreign workers to return to their home countries.
The Czech government is offering free air tickets and a one-time allowance of 500 euros for a limited number of legal migrant laborers who have recently lost their jobs due to the global financial crisis.
Czech media reports the offer has had many takers among workers from Mongolia and other Asian countries.
Serhiy, however, is not rushing to use the opportunity to return to Ukraine. Even if he loses his job, he says he will remain in the Czech Republic and look for work there.
“I don’t want to go back to Ukraine. I was there for four days during the New Year holidays. I’ve seen how life is there. It’s chaos," Serhiy said. "And I saw something I've never seen there before: envy. People don't have jobs. They're simply angry at everyone."
Despite the wave of job losses, most Ukrainian migrants are opting like Serhiy to stay in the Czech Republic. They say their future would be even bleaker if they returned home.
Ukraine has been hit particularly hard by the economic downturn. State statistics indicate the country's industrial production has sunk by more than 34 percent since last year.
The local currency, the hryvna, has plunged in value by nearly 60 percent, the stock market has nose-dived, and many banks have given up lending or even returning deposits amid a huge cash shortfall.
Joblessness and inflation are on the rise. Volodymyr Halytsky, who directs the state employment center in Kyiv, said unemployment rates are set to exceed 9 percent by the end of the year.
“I think during the year, some 3 million people will find themselves out of work. This estimate is based on economic indicators in the state budget that forecast unemployment rates reaching 8.5 to 9 percent,” Halytsky said.
Hundreds of thousands of Ukrainians have left the country since the collapse of the Soviet Union in 1991. Between 3 million and 7 million Ukrainians are now believed to live outside its borders.
Many of those Ukrainians live and work in Russia. But it is Western European countries -- including Italy, Spain, and Portugal -- that have become the most attractive destination for newer waves of Ukrainian migrants.
Many households in Ukraine depend almost entirely on remittances sent by family members working in Russia and the European Union. About $8.4 billion, or 8 percent of Ukraine's GDP, comes from remittances.