Estonia at the Age of Migration

The two main themes of the previous Human Development Report were the continuing demographic decline in Estonia, and greater openness of Estonia to the changes occurring across the world (Vetik 2015). Migration is at the heart of both themes. Sociologists speak for quite some time already about the arrival of the age of migration and its significant impact on Europe (Castles et al. 2013). Europe has been a major global migration destination for decades. The enlargement of the European Union in 2004 triggered a large-scale population migration from the new members to the old EU-15. The refugee crisis of 2015 brought the issue of migration sharply to the attention of European citizens, the media, and politicians. New EU member states, Estonia among them, got involved in Europe-wide debates on migration. There are two sides to the coin of migration: in the short term, it helps to overcome the demographic and economic issues facing aging European societies; in the long term, it creates new challenges related to social cohesion and poverty.

Estonia is characterised both by extensive immigration and emigration periods in the past two centuries. Today, Estonia is undergoing migration turnaround and the nature of migration processes is changing as well. There are still many emigrants who are leaving Estonia for good, but the number of immigrants has been exceeding the number of emigrants since 2015. Estonia has become a more attractive migration destination and employers’ interest in recruiting migrant workers has significantly increased in recent years. In addition to permanent migration, there is an increasing number of people who move to a foreign country temporarily, for career or studies reasons, and then move further to another country (onward migration) or return back to Estonia (return migration). There are also those who move repetitively between Estonia and abroad (circular migration), or who are in a constant movement between their workplace in one country and home in another (cross-border commuting). Migration also affects the people who stay put — as the vast majority of the populations of all countries presently do.

While the nature of migration has changed and its causes and forms are more diverse than ever, its most important driving force is the same: the search for a better life. While people migrate for different reasons — to find a job, for family reasons, for studies, or seek a refugee from persecution — the dominant flow is towards countries where life is better. However, large-scale immigration tends to bring imbalances and tensions to receiving societies. In recent years, Europeans have become more aware of the challenges related to migration, such as problems with social cohesion and deteriorating internal security. Voters in a number of European countries, and in the U.S., have sent a clear signal that they support a more cautious attitude towards uncontrolled mass immigration. This Human Development Report focuses on these issues in Estonia by investigating changes in the people’s well-being over the last 25 years based on the Human Development Index; the new trends in migration to and from Estonia; the changes in Estonian diaspora communities abroad and what are the impacts of migration on Estonia’s development, e.g. on the new challenges related to ethnic integration; on the size and composition of Estonian population; as well as on Estonian language and culture in today’s open world at the digital age and age of migration. The Report seeks answers to all of these questions and it draws the following conclusions.

• According to the Human Development Index (it’s components include health, education, wealth) the rate of improvement in well-being in Estonia has been one of the greatest in Europe over the last 25 years. In terms of education and health, Estonia is comparable to other countries with high levels of human development; in terms of wealth, Estonia is still lagging behind. The level of inequality continues to be high; it is one of the highest in Europe as measured by the Gini coefficient of income distribution.
• Estonia is experiencing a migration turnaround. Not all Estonian people fully benefit from welfare gains, in particular unskilled workers and those living in remote areas. This is still the main cause of emigration to Finland and other EU Member States with a higher standard of living. However, improved well-being has increased immigration to Estonia, in particular from third countries. The year 2015 was significant in that for the first time in 25 years the number of immigrants to Estonia exceeded the number of the people who left.
• In an open world, the activity spaces of people do not coincide with the territories of countries. Today’s Estonia is thus a transnational country where diaspora members, companies and residents of Estonia interact intensely across state borders. Just as a step-family changes our understanding of bringing up children, of the relations between parents and children, and of different family models, transnationality changes our understanding of the relations between migration, integration and the state.
• Social relations between the Estonians and the Russian-speaking population of Estonia are still modest. Today’s increasing immigration places the issue of ethnic relations in a new light because new arrivals come from very different regions of the world. Social cohesion can be enhanced by, in addition to prioritising the Estonian language, promoting interaction between people. A single Estonian-medium educational system (kindergartens and schools) can be a driving force behind integration with the labour market as its implementer; the success of integration is demonstrated by the elimination of wealth differences and willingness of people of different ethnic backgrounds to live in a same area.
• The population of Estonia will not decrease below the current level by the end of the 21st century only if two conditions are met: birth rates increase and the number of arrivals exceed the number of those leaving. To achieve this, Estonia needs focus both on family and migration policies. Due to the inertia of population change, however, both the total and working-age populations of Estonia are very likely to continue to decline over the next decades. The decrease of the workforce can be counterbalanced by moderate immigration combined with a more optimal use of the existing human resources. It should not be forgotten that a smart economy requires fewer workers.
• The experience of European countries with mass immigration of skilled and unskilled workers has shown that while immigrants can do the necessary jobs that often require lower skills, it comes at a price: long-standing problems related to a decline in social cohesion. After phasing out the current passive migration policy, Estonia could consider an active migration policy that is based on labour market needs and the country’s integration capacity. The cornerstones of Estonia’s migration policy should be introducing a points system in labour migration and promoting student mobility.
• A comprehensive approach and taking the advantage of new technological capabilities will ensure the sustainability of small languages and cultures in an open world of migration and digital technology. A comprehensive cultural policy embraces the Estonian culture in all of its diversity (not merely professional and heritage culture) and contributes to the skilful integration of elements of other cultures. While the Estonian culture is based on the Estonian language, the bearers of culture, including the Estonians, will be increasingly proficient in other languages and interact more and more with people from other cultures.

While Estonia’s well-being has improved quickly, inequalities persist.

Estonia is experiencing a migration turnaround. Not all Estonian people fully benefit from welfare gains, in particular unskilled workers and those living in remote areas. This is still the main cause of emigration to Finland and other EU Member States with a higher standard of living. However, improved well-being has increased immigration to Estonia, in particular from third countries. The year 2015 was significant in that for the first time in 25 years the number of immigrants to Estonia exceeded the number of the people who left.

Although the level of the economic development, in particular the level of wages, is an important element of human well-being, the concept of well-being is much broader. The Human Development Index measures well-being based on health, education and income per person. Although all three dimensions are affected by our current policy decisions, the they are a sum total of long-term progress and choices made in the society. For instance, we can adopt legislation promoting the reduction of smoking and guiding people towards a healthier diet and more active lifestyle. However, the positive effects of such legislation on human health will only be seen after decades pass. This is why the countries that continuously, systematically, and comprehensively promote human health, education, and employment reach the highest levels of well-being, i.e. are at the top of the Human Development Index. These are the countries where people prosper and which lure people of other countries. It is an integral part of development: Making a country better improves the well-being of it’s citizens on the one hand but makes it more attractive to others, to both migrants and foreign companies, as well. Thus, well-being and migration are inextricably linked.

Since the launch of the Human Development Index in 1990, its world average value has increased from 0.597 to 0.711 in 2015. Estonia has moved up six places compared to 1991, and currently ranks 30th out of 186 countries with an index value of 0.861 (Annex 1). In 1990–2015 Estonia’s HDI increased faster than in the majority of EU Member States (the increase has only been bigger in Ireland and Croatia). Of the new Member States, in absolute terms, only Slovenia and the Czech Republic boast higher HDI values. Thus, we can say that Estonia’s collective choices and decisions — from the monetary reform of 1992 and other radical reforms of the early 1990s (fast privatisation, low taxes, etc.) through the decision to join the EU and NATO, a rapid adjustment to the digital revolution, and the actions of different government coalitions, to everyday decisions by individuals and companies — have resulted in a significant improvement of the country’s well-being. The structural changes brought along by opening up of eastern Europe, including Estonia, to the global economies have helped to close the productivity gap with western European countries (Varblane and Kattel 2017, this Report).

However, rapid development has its downsides, which have been highlighted by a number of previous Estonian Human Development Reports. Inequalities tend to grow at the outset of social changes: there are those who benefit more from the development and improved well-being and there are others who are caught between the cogs of changes (Åslund 2007). Globalisation and the greater role of markets also tends to increase inequalities between countries and people (Piketty 2014). No wonder that Estonia’s small and open economy, which was based on a strong belief in the free market economy, dramatically increased inequalities in the early 1990s — inequalities that persist to this day. According to the Gini coefficient — the most commonly used measure of inequality — only Latvia, Lithuania and Romania have greater income inequalities than Estonia among the EUR member states (Eurostat 2017). Among East European countries, the Czech Republic managed to implement social transformation without substantial increases in inequalities: their Gini coefficient is comparable to those of the Nordic Countries.

In Estonia, there are great regional inequalities. While in the capital city Tallinn, income per inhabitant exceeds the EU average, in peripheral rural regions it is far below the average. Such regional differences have a number of objective causes. People across the world tend to cluster in big cities in search of better lives. Added to this is the legacy of the former Soviet Union: Estonia like other East European countries inherited an outdated economy and the related population distribution pattern. The inefficient, centrally planned economy of the Soviet Union led to a chronic shortage of essential food products, which, in turn, resulted in very high employment in agriculture. At the end of the Soviet period, the proportion of the rural population — one in five workers was employed in agriculture — was very high compared to Western Europe. Agricultural production declined under the new market economy conditions after the collapse of the Soviet Union and restoration of Estonian independence in 1991, and the number of agriculture jobs decreased considerably (employment in agriculture has fallen to less than 5%); this is why peripheral areas were most heavily hit by the social transformations (Annist 2017, this Report). While the emerging services sector offered an alternative to disappearing industrial jobs in cities, there was no such compensating change in remote rural areas. The Soviet-time regional distribution of the population (characterised by a very high percentage of rural population) was simply not compatible with the new market-based social order.

While the numbers of arrivals and departures has balanced out, the ethnic makeup of the population is under a change because of migration

In an open world, the activity spaces of people do not coincide with the territories of countries. Today’s Estonia is thus a transnational country where diaspora members, companies and residence of Estonia interact intensively across state borders. Just as a blended family changes our understanding of bringing up children, of the relations between parents and children, and of different family models, transnationality changes our understanding of the relations between migration, integration and the state.

Emigration rates continue to be high, and people with low incomes (Tverdostup and Masso 2017, this Report) and those from remote areas (Annist 2017, this Report) continue to be overrepresented among those who leave. Thus, not all people have benefitted from Estonia’s success and this continues to be an important cause of high migratory outflow. But Estonia’s membership to the EU and the improvement of well-being in recent years has significantly increased immigration to Estonia as well (Tammur, Puur and Tammaru 2017, this Report). Before Estonia joined the EU, the number of immigrants to Estonia was less than 2,000 in a year; by 2015, this number increased to nearly 6,000. The year 2015 was also significant in that the number of registered immigrants into Estonia exceeded the number of emigrants for the first time since 1991. One or two years of data is not sufficient to claim that Estonia has switched from emigration country to immigration country. Rather, the process we are witnessing now is a migration turnaround: improved well-being increases immigration, while emigration rates are affected by relatively high inequalities compared to other EU Member States. Migration is in particular intensive to and from neighbouring countries, with the main target country of emigration being Finland and the main source country of immigration being Russia.

Four groups of people can be distinguished among those migrating to Estonia. The first, about half of all arrivals in recent years, consists of the people returning to Estonia. Emigration will not always lead to return migration: people may not want, or are unable, to return to their native country. The proportion of Estonians who have worked or are still working abroad is one of the highest in Europe (Kumer-Haukanõmm and Telve 2017, this Report). As those who leave Estonia are mainly low-paid workers and, therefore, the share of low-paid workers is higher among return migrants compared to those with no experience with working abroad (Tverdostup and Masso 2017, this Report).

The second group consists of the people arriving from the territory of the former Soviet Union, mainly from Russia and Ukraine. They account for a third of all immigrants. Mainly due to this the net migration from third countries taken together is positive, i.e. more people arrive from than leave to those countries. Estonian migration has thus two faces: we are losing people to better-off and wealthier ‘old’ member states and gaining new residents mainly from the third countries east of Estonia. An overall improved well-being and the recent EU Member State status have increased the attractiveness of Estonia as a target country. In other words, the river of migration is flowing from east to west: from Russia and Ukraine to Estonia and from Estonia to Finland and the UK. People in former Soviet republics are familiar with Estonia and other eastern European countries, which, besides the higher living standards, adds to the attractiveness of Estonia as a destination for migration. The fact that Russian is widely spoken in Estonia is also an important factor. Immigrants from third countries also include, besides professionals, unskilled workers and students.

The third group comprises immigrants from other EU Member States: Their number varies year by year and they account for about one-tenth of all arrivals. People come from other Member States for reasons including; careers, to study, or to be with their Estonian partner. The fourth group, also about one-tenth of all immigrants, consists of people moving to Estonia from the rest of the world. This group, while small in number, consists of people of very diverse backgrounds: People move to Estonia from all continents.

Estonian residents and diaspora members are intertwined into a transnational Estonia.

Social relations between the Estonians and the Russian-speaking population of Estonia are still modest. Today’s increasing immigration places the issue of ethnic relations in a new light because new arrivals come from very different regions of the world. Social cohesion can be enhanced by, in addition to prioritising the Estonian language, promoting interaction between people. A single Estonian-medium educational system (kindergartens and schools) can be a driving force behind integration with the labour market as its implementer; the success of integration is demonstrated by the elimination of wealth differences and willingness of people of different ethnic backgrounds to live in the same area.

As a result of the current and previous emigration waves there are at least 200,000 Estonians living in other countries (Kumer-Haukanõmm and Telve 2017, this Report) who have close or moderate contacts with their families and friends back in Estonia. Thanks to the digital age and cheap transportation services, it is easier than ever before to maintain contacts with one’s homeland. According to 2011 census data, some 25,000 Estonians were working abroad; the number of Estonian students studying abroad for a longer or shorter period has increased, as well as the number of short-time stays. The situation where individuals and companies are engaged in simultaneous activities in a number of countries is called transnationalism; and this is especially likely to happen in small countries (Ahas et al. 2017, this Report). In the digital age, it is easy to maintain contacts with one’s homeland, and Estonia and diaspora communities are more and more intertwined to each other.

On the one hand, transnationalism can be a source of problems, such as family members living apart, the taxation of companies, or determining one’s citizenship. On the other hand, states, individuals and companies are starting to view transnationalism as an opportunity. This is often dubbed a triple-win: The home country gains through increased employment and national income, the host country gains through labour supply without having to deal with the issues of immigration and integration, and the migrant worker gains through higher income and new experiences (Ahas et al. 2017, this Report). Transnationalism also opens up new avenues for companies. In the 1990s, the transnationalism of the economy primarily meant foreign investments and the establishment of subsidiaries of foreign companies in Estonia, which gave an important impulse for the development. Today, foreign invested companies employ nearly half of the Estonian working population. However, the transnational character- of the economy has become more extensive and diverse. Businesses started in Estonia have become international and an increasing number of Estonian businesses are operating beyond national borders from the moment they are established (Varblane and Kattel 2017, this Report).

Transnationalism is mainly associated with neighbouring countries, which are the most accessible for various reasons. Thus, it is logical that businesses and individuals have the closest links with Finland, which means that the main artery of transnational Estonia runs between Helsinki and Tallinn (Ahas et al. 2017, this Report). Economists have been treating Tallinn and Helsinki as a single labour market — Hellinn or Talsinki — for some time now. However, Estonian businesses (Varblane and Kattel 2017, this Report) and diaspora communities (Kumer-Haukanõmm and Telve 2017, this Report) are operating on all continents.

From the perspective of the development of the Estonian economy as a whole, it is beneficial that our businesses are linked to the greatest possible number of global supply chains, and that they maximise their potential for added value, i.e. creating smart and well paid jobs (Varblane and Kattel 2017, this Report). Besides Finland, the most logical business partners are our other neighbours — Sweden, Latvia and Lithuania — which can be increasingly considered as an extended domestic market for Estonian companies. What is important in a transnational world, is how companies are able to create stories and messages related to their products and services so that these messages are unoffending and understood by people of various linguistic and cultural backgrounds both in Estonia and abroad (see: Torop 2017, this Report). English alone is not sufficient to succeed; we need people who are proficient in other languages and familiar with cultures: this is where the state’s support to companies should start.

The essence of today’s Estonia is summed up well by linguist Martin Ehala (2017, this Report) who characterizes modern Estonia as a set of Estonian communities and towns located across the world. When discussing Estonia’s future we cannot overlook the fact that the age of migration has changed what was formerly self-evident, i.e. that the territory of a state, its businesses and citizens coincide (Kallas 2017, this Report). The activity space of Estonian residents and companies extends beyond state borders, while the citizens and companies of other countries are living and operating in Estonia. We can object, but it is wiser to adapt to the open and networking modern world and to use the opportunities it offers while addressing any related problems.

One of the issues related to transnationalism is a new type of inequality arising from mobility. The people who travel extensively or have travelled the world from an early age, due to their parents’ work or holidays, are used to adapting quickly to new places and environments. Each trip to another country increases confidence and builds their ability to cope with different people and situations. In literature on the subject, this is called mobility capital, which essentially means greater adaptability to situations in which people have to interact with others that they see as different. People who have never travelled miss this new form of capital, which is the bases for many fears at the age of migration. In order to equip more people with mobility capital, the European Commission, for example, has targeted a significant part of the funding for academic life to supporting opportunities to study and gain work experience in other countries. The intention is to ensure that at least 20% of students study temporarily at a university other than their Alma Mater. In addition, it is increasingly harder to climb the academic ladder without the experience gained from study and work abroad (Pajumets 2017, this Report).

Another issue of transnationalism relates to social cohesion. From the point of view of the home country, it is beneficial when people living abroad maintain strong transnational connections with their homeland; do not renounce the citizenship of their country of origin; when they establish societies and schools in the host country; when they are actively involved in common transnational activities; and when they follow the media and interact with their compatriots back in their homeland (Kumer-Haukanõmm and Telve 2017, this Report). However, it may pose a problem for the host country if transnational’s strong connections with their home countries and diaspora communities are not counterbalanced by integration with the host society and they continue to live in the information and media space of their former homeland (Vihalemm 2017, this Report). Instead of the triple win — for the home country, transnational people, and the host country — it can easily happen that all three lose out. This is the case where people find themselves in jobs that are below their qualifications, thus rendering the home country’s spending on education and training useless; this is damaging to the worker’s qualifications and confidence, not to mention the dissatisfaction of the host country’s population who often feel that their jobs are lost and wage rates are falling.

A number of countries, including Estonia, are in the process of replacing the traditional diaspora policy with a modern transnationalism policy, which aims at recognition, connection maintenance, and promoting remigration (Jakobson 2017, this Report). The transnationalism policy can only be successful if it is geared towards the triple win: the home country — transnationalism — the host country. The same applies to transnational companies: their success also requires the triple win. The recognition of compatriots living abroad, various forms of common activities and memberships form an integral part of the diaspora inclusion policy. This helps to maintain community spirit and language skills without contradicting the host country’s adaptation and integration policies for transnationals. Various forms of parliament have been established to recognise compatriots living abroad and connecting them with their home countries. For instance, Finland has the diaspora parliament, while Italy even ensures a representation in Parliament for its citizens living abroad. In other words, transnationals and emigrants are included in the life of their home country without exerting a direct effect on the integration policies of the host countries.

The biggest challenge arising from transnationalism for countries relates to citizenship and the related rights and obligations. This means that there is a need to resolve the question of who is responsible, in terms of policies, taxation and social security, for the people who live in a transnational world (Kallas 2017, this Report). From the perspective of Estonia, the Constitution of the Republic of Estonia is working fairly well in terms of the citizenship: while the constitution does not allow for dual citizenship, no one may be deprived of their Estonian citizenship acquired by birth (Jakobson 2017, this Report). Now, the questions to think further are whether the Citizenship Act should be matched with the spread of transnationalism, and whether to better tackle the issues related to the rights and obligations of the citizens living transnational life.

A cohesive society is ensured by an educational system that is based on the Estonian language but also values also other languages.

The population of Estonia will not decrease below the current level by the end of the 21st century only if two conditions are met: birth rates increase and the number of arrivals exceed the number of those leaving. To achieve this, Estonia needs focus both to both family and migration policies. Due to the inertia of population change, however, both the total and working-age populations of Estonia are very likely to continue to decline over the next decades. The decrease of the workforce can be counterbalanced by moderate immigration combined with a more optimal use of the existing human resources. It should not be forgotten that a smart economy requires fewer workers.

Over the last 25 years, the ethnic make-up of the Estonian population has moved in two opposite directions, mainly as a result of migration. On the one hand, the share of ethnic minorities has decreased in total population. In the context of overall depopulation, the number of ethnic Estonians has been decreasing at a slower pace than other ethnic groups. Compared with 1,565,700 people in 1989, the population of Estonia declined to 1,316,000 (i.e. by 16%) in 2016. The number of ethnic Estonians fell from 963,300 to 905,800 people, while the number of people of a different ethnic background decreased from 602,400 to 410,200 and their percentage in the total population dropped from 38% to 31%. Estonia has become more ‘Estonian’ over the last 25 years, which means that the situation is different from that in the majority of other European countries. However, the institutionalised segregation of Estonians and the Russian-speaking population (including the Estonian-medium and Russian-medium schools) — a legacy of the Soviet period maintained till today — continues to be a problem.

On the other hand, the linguistic and cultural diversity of Estonia’s population has increased as a result of new immigration. New immigration tends to amplify rather than weaken ethnic segregation in Estonia. While newly arrived immigrants from the EU mainly settle in areas with the Estonian majority (Leetmaa 2017, this Report), they prefer to enrol their children in the newly established English-medium international schools which are not directly linked to the Estonian educational system (Lauri et al. 2017, this Report). The immigrants from the territories east of Estonia tend to settle in areas with the Russian majority (Leetmaa 2017, this Report), thus amplifying the language-based parallel societies established at Soviet times.

For Estonians, the knowledge of the Estonian language is an important aspect of identity and all people residing in Estonia, whatever their ethnic background, are expected to be able to speak Estonian. However, those immigrants who came to Estonia during the Soviet period had neither the obligation nor the need to learn Estonian. Accordingly, and in the spirit of the Estonian Constitution, the Estonian integration policy has so far been focused on Estonian language learning (Valk 2017, this Report). Proficiency in Estonian is important both in a symbolic sense (language as a vector for identity) and in a functional sense (a shared language simplifies everyday communication). A good command of Estonian thus contributes to the better inclusion of other ethnic groups in Estonian society, and would make the attitudes of the Estonians towards immigrants more positive. However, creating a commonality between different ethnic groups includes much more than language skills: Learning the culture of the host country, studying, working and spending their leisure time together, mixed marriages, inter-ethnic friends, shared social networks, etc. Estonian language skills may not necessarily lead to active interactions between people of different backgrounds, but if people, children in particular, interact with each other, their language skills will improve quickly. Aune Valk (2017, this Report) argues that important changes that have occurred in the last decade include less hostile attitudes of the Estonians towards people of other ethnic backgrounds and a more open identity. The latter does not mean that Estonian ethnic identity has become weaker. The changes in the identity of the Russian-speaking population are, however, marginal.

Identity and the sense of belonging guide many important life decisions, including the decision whether to emigrate, or stay put, and decisions related to integration, maintaining connections with one’s country of origin, etc. The chapters dealing with integration and identity and with language changes repeatedly refer to the central role of school in connecting parallel communities of different languages and ethnic backgrounds. Today, Estonia has been functioning as an independent state for a quarter of a century, yet it still has an institutionally segregated education system that sorts children since the age of three into parallel worlds based on their mother language. Young people start to engage more closely with each other only when they go to university; however, a sizeable share Russian-speaking youth do not enter Estonian universities, which is partly due to their poorer language skills. This has led to a situation where the share of highly educated people is lower among the Russian-speaking population (Saar and Helemäe 2017, this Report). The institutionally segregated system prevents small kids and young people from forming common social networks and values, and even from having a common information space. Increasing the number of Estonian classes in Russian-medium schools does not ensure active language skills. Moreover, as indicated by Triin Lauri, Kaire Põder and Leen Rahnu (2017, this Report) based on the results of the PISA test, the performance of pupils in Russian-medium schools is significantly lower than that of the pupils in Estonian-medium schools. Therefore, the time is ripe for replacing Estonian-medium and Russian-medium schools by a unitary educational system, which is based on the Estonian language and takes the linguistic diversity in Estonia into account at the same time.

Segregation in education carries over to the labour market (Saar and Helemäe 2017, this Report) leading to the disparities in income that in turn translates into the increase in residential segregation (Leetmaa 2017, this Report). In other words, minority disadvantages cumulates and, as a consequence, Russian-speakers cannot afford to buy a home in the same neighbourhoods as the Estonians. The vicious circle of segregation closes since schools are neighbourhood based. Europe’s experience shows that if immigrants are overrepresented among unskilled workers and clustered in poorer neighbourhoods, and if poverty overlaps with ethnic segregation, there is no escape from ethnic tensions and social problems. Therefore, in the context of the recent rise of immigration, the moment has come for Estonia to take decisive steps to amalgamate these linguistically and ethnically divided parallel societies and aim to build a more cohesive society. The institutions through which the vicious circle of segregation can be broken are kindergartens and schools.

While kindergartens and schools are the key to addressing a number of integration challenges facing Estonian society, the onus for the creation of a cohesive society cannot be placed on the shoulders of schools and teachers without offering the appropriate support and allaying people’s fears that obviously would stem from such reform. The most important fear concerns that other ethnic groups will gradually lose the knowledge of their native language and culture, and their school performance will deteriorate because parents are unable to provide the necessary support to their kids due to their own poor language skills. In addition to investments in the infrastructure, the state should therefore decidedly increase investments into the educational system. At the age of migration, the future Estonian school will be even more multicultural and multilingual than now and Estonians need to adapt to this. The Ministry of Education and Research is developing models of multicultural schools and has involved a number of schools in this process. While a popular misconception — that multilingualism can cause delayed development of both languages — is still widely held, the main causes of problems at the age of migration in the world interwoven from relate to getting closed to one’s own culture and poor language skills (Verschik 2017, this Report). A model of an unitary educational system should take account of the diversity in cultures and values so as to ensure that this does not undermine society’s cohesion, and help to prepare kids for today’s world of cross-cultural interaction.

To conclude, kindergartens and schools can be viewed as drivers of ethnic integration, the labour market is its promoter, and decreasing residential segregation demonstrates its success. For the latter to occur, the two following important conditions must be met: first, the values (housing preferences) of different ethnic groups must be similar; and second, the pay gap must be reduced, i.e. everybody segregation in the labour market should decrease. The results of this report reveal, though, that the degree of residential segregation of the Estonians and the Russian-speaking population has increased not decreased over the last 25 years.

A combination of higher birth rates and positive net migration prevent population decrease in the future

The experience of European countries with mass immigration of skilled and unskilled workers has shown that while immigrants can do the necessary jobs that often require lower skills, it comes at a price: Long-standing problems related to a decline in social cohesion. After phasing out the current passive migration policy, Estonia could consider an active migration policy that is based on labour market needs and the country’s integration capacity. The cornerstones of Estonia’s migration policy should be introducing a points system in labour migration and promoting student mobility.

In the twenty-five years since Estonia restored its independence, the population of Estonia has decreased by 250,000 people. Luule Sakkeus, Allan Puur and others (2017, this Report) conducted a population projection to find out under what the conditions depopulation can be halted or reversed, and how this could affect the ethnic composition of the population of Estonia. The projection suggests a number of migration scenarios combined with birth rates. If current birth rates continue, Estonia will need approximately 440,000 extra residents (migrants and their descendants) by the end of the 21st century to maintain its current population size. Even if as much as half of the 200,000 Estonians currently living abroad were to return to Estonia, which is not very likely, the share of ethnic Estonians would fall below 50% due to the 200,000–250,000 migrants of different ethnic backgrounds. On the one hand, many Estonians are not prepared for this; on the other hand, this means that even more attention must be paid to achieving a more cohesive society, in particular to abolish the segregated educational system. Indeed, the share of children of different ethnic backgrounds increases faster than total population because migrants are mainly young people in family ages.

With regard to maintaining Estonia’s population without significant immigration, the scenarios worthy of attention are those that foresee, besides immigration, an increased birth rate. The only scenario ensuring current population size (1.4 million people by 2100) is the one in which the birth rate increases to 2.1 children per woman on average, combined with positive net migration of approximately 200,000 people by the middle of the 21st century. If the current fertility behaviour with one in ten women being childless and one in three having only one child continues, the rest should give birth to three children on average to achieve this goal. However, even in such a scenario the population will decline at the beginning of the projection period as the people reaching the childbearing ages in the next decades are from the small generations of the 1990s. The population would return to a path of growth around 2040. However, if the retirement age is not increased, the number of people of working age will remain below the current level in 2100. Thus, both the general and working-age populations of Estonia are very likely to decline over the next decades even if birth and migration rates increase significantly.

As increased migration tends to divide societies, even more attention should be focused on the family policy if the aim is to avoid depopulation. As shown by the population projection prepared for this Human Development Report, increased birth rates can significantly reduce the need for immigration. While it is difficult to point out a causal link between specific family policy measures and the number of children born, the differences in the birth rates of different countries indicate that both family policies and the organisation of society in a broader sense do have a significant impact on birth rates. As regards the family policy, Estonia has made quite good progress: from well-functioning kindergarten and parental benefits systems to a significant increase in benefits (in Estonian terms) paid to families with three or more children in 2016. The coming years will show the results of the last measure. But it is definitely possible to find more ways to improve the wellbeing of families with children. One of them relates to housing since families and homes are inherently related. Estonian population is increasingly concentrated in larger cities, in particular in Tallinn, where the birth rate is the lowest. The situation of two urban families with the same income, one childless or with one child and the other with three children, in the capital city’s housing market is very different: The family with three children needs a bigger home while their income per household member is significantly lower even when parents earn similar incomes. However, housing and other specific family policy options are not included in the range of the topics of this report, and we leave it for future discussion.

While every child born has an immediate positive effect on population growth, they enter the labour market only after 20 to 25 years. Therefore, increasing birth rates now will address future labour market issues, rather than the current ones. The large generations of the 1980s are replaced in the labour market by the generations of the 1990s — merely half of the size of the previous generations — so a drop in the number of workers is inevitable. It is therefore not surprising that entrepreneurs are seeing migration as the main means of tackling labour shortages (Raasuke 2016). Recruiting workers from abroad enables employers to hire immediately, and in many sectors, it is a rational decision. The population forecast prepared for this Human Development Report shows, however, that in order to counterbalance the decrease in the number of workers, we would need more immigrants than the Estonian society is able to integrate. This means that labour issues must be addressed by various measures, not only by increasing migration. An efficient package of measures for the next 20–25 years includes improving the value and better use of Estonia’s human resource, moving of businesses up on the value chain, i.e. increasing productivity, and selective immigration.

As regards internal resources, it is crucial to increase the contribution of the Russian-speaking population in the labour market so that it corresponds to their share among the working-age population. Currently, unemployment rates for Soviet-time immigrants and their descendants significantly exceed those for ethnic Estonians. Those in employment are also much more likely to be employed in manual jobs. Ellu Saar and Jelena Helemäe (2017, this Report) have convincingly shown that Russian-speakers who have a good command of Estonian and are Estonian citizens perform better on the labour market than those who do not speak Estonian and are not Estonian citizens, albeit not quite as well as ethnic Estonians educated to the same level. Regrettably, this also applies to the second and third generations of Russians in Estonia. On the positive side, there are professions where Estonian Russians who have a good command of Estonian and are Estonian citizens are equally or even more successful in achieving high positions than ethnic Estonians. However, Estonian Russians are underrepresented in these sectors (including the public sector). A greater involvement of ethnic minorities in the public sector would contribute to the mobilisation of internal workforce resources. There are certainly other under-employed population groups (such as older people or people with special needs); the pay gap issue also needs to be addressed; and we need to increase the retirement age and make it more flexible.

Immigration has its role in addressing the labour market and population challenges faced by Estonia. In 2005, Rein Taagepera used the metaphor of a bottomless toilet seat to illustrate Estonia’s demographic trends. He explained that the number of births would soon decrease as the small generations of the 1990s reach the childbearing age, replacing the large generations of the 1980s. Immigration would help to counterbalance these demographic waves to some extent and to increase the number of people of family-starting age. However, we need to be choosy about immigrants. Return migration needs to be particularly encouraged and for this purpose, we need to make a good progress in implementing the transnationality policy (Jakobson 2017, this Report). While the initiative “Bringing talents home” was heavily criticized, which discouraged the authors; it was definitely a step in the right direction. We should learn from the experience and go forward with new and better-thought-out action plans for promoting return migration. We also need a new approach to the immigration policy as a whole.

It is time for Estonia to introduce an active immigration policy.

A comprehensive approach and taking the advantage of new technological capabilities will ensure the sustainability of small languages and cultures in an open world of migration and digital technology. A comprehensive cultural policy embraces the Estonian culture in all of its diversity (not merely professional and heritage culture) and contributes to the skilful integration of elements of other cultures. While the Estonian culture is based on the Estonian language, the bearers of culture, including the Estonians, will be increasingly proficient in other languages and interact more and more with people from other cultures.

In Estonia, the debate on immigration reflects our negative experience with previous immigration waves and the related traumatic memories (Laanes 2017, this Report). The Estonians’ earlier experience with immigration tells that immigration leads to a split society; therefore, the attitudes towards even a very small number of people arriving from other language and cultural spaces tend to be largely negative. The experience of other European countries with the influx of migrant workers in the post-war decades is not very encouraging either because of many integration problems of immigrants and their descendants (Thomson and Crul 2013). Immigration has shifted balance between political parties and puts the solidarity and sense of unity among European countries to the test. Some people feel that a nation state’s ideals and the survival of their language and culture are in danger. Others feel offended because they feel increased competition and wage pressures in the labour market. The poor integration of immigrants has made internal security threats one of the most important issues in a number of European countries (Valdaru, Asari and Mälksoo 2017, this Report).

In order to address the issue of social cohesion it must be carefully considered how many and which workers can be recruited from abroad without creating social imbalances (Asari and Maasing 2017, this Report). This can be achieved with an active migration policy. The lesson from the current European refugee crisis is that the loss of democratic control over and social agreement on immigration results in divisions within society (Valdaru, Asari and Mälksoo 2017, this Report). This benefits neither the citizens nor the immigrants. A basis for preventing problems is a democratic decision-making process that leads to an immigration policy that is tailored to the needs of the labour market and ensures social cohesion. Estonia’s immigration policy has become significantly more open compared with the early 1990s — only a small part of immigration is subject to quota restrictions that once used to be the main element of the migration policy (Asari and Maasing 2017, this Report). For example, the process of hiring managers and top professionals (white-collar employees) was recently significantly simplified. With the working-age population declining, the pressure to simplify the immigration process for manual workers will inevitably increase.

However, it is exactly the migration of manual workers that often causes more long-standing problems than it resolves in the short-term by helping to overcome the shortage of labour. Bringing in new workers often slows down innovation, keeps wage and productivity levels low and contributes little to tax revenues. Integration often happens slower than expected and, instead, immigrants are socially excluded, in particular if their incomes remain low and they cluster in poorer neighbourhoods. This gives rise to parallel societies, contributes to the vicious circle of segregation and radicalization. The trends in the UK and elsewhere in Europe also illustrate the fact that immigrants cannot be merely treated as a workforce. Even the idea of bringing people to Estonia to do the jobs that Estonian citizens don’t want to do creates the wrong context for social cohesion. The jobs that are unattractive to Estonians should be done by robots, not offered to migrant workers. Automation creates smarter jobs. Smarter jobs mean higher pay, which reduces the pressure to emigrate and the need for importing manual workers.

The jobs of the future will mainly be smart and creative and require digital literacy. To put it figuratively, Estonia needs more ‘brains’ and fewer ‘hands’. Automation and smart jobs will reduce labour shortages and the demand for unskilled jobs. We are gradually getting used to self-checkout tills in supermarkets and speed cameras on roads. This is just a start. Visionaries, such as Bill Gates, claim that as many as half of today’s jobs may disappear in the future. Machines will take over from humans, be they brokers, estate agents (sharing economy), accountants, assembly line workers, cleaners or other occupations. The digital revolution, video lectures, tutorials, and web publications also have an impact on smart jobs. A number of European countries are discussing the introduction of a citizen’s wage or ‘basic income’, and some have already tested it in one way or another because there are not enough jobs at times of smart economy, automation and digital revolution.

In the light of these developments, there is a need for a new active migration policy that focuses on a better management of immigration. The new active immigration policy could stand on two pillars: a point system for labour migration tests and student mobility. The existing pay criterion and a form of the quota system in place today could support these measures. The point system, in its initial form, was detached from the needs of the labour market and focussed on the integration potential of migrants, but it does not necessarily have to be so. The two types of policies — those focussing on labour market and integration capacity of migrants — could also be married with each other. For instance, the system used in Canada takes into account the proficiency in official languages, education, work experience, age, existence of relevant jobs, and integration capacity in its broadest sense (including previous stays in the country, family ties, etc.). Young people are preferred because their integration capacity is believed to be greater. In addition, the responsibility for integrating migrants is partially placed on the employer.

The implementation of a points system in combination with taking account of the employers’ needs would prevent the integration-related issues currently faced by many European countries. We should learn from the mistakes of others. The companies hiring migrant workers could join the existing Diversity Charter and the proposed Integration Charter. The latter would include the principles of integrating migrants into Estonian society, approved by all parties to the Charter. The existence of an agreement on the number of immigrants, the required skills and the measures of their integration into Estonian society would definitely alleviate people’s fears about immigration. On the one hand, the process of hiring migrant workers would become more complicated for employers; on the other hand, it would ensure society’s support and reduce confrontation from the very hiring process of employers.

A great way to achieve social cohesion and to ensure that people stay in Estonia is to increase the number of top professionals by student mobility. If a young person has lived and studied in Estonia for five years, they have probably learned the language, made friends and perhaps found a partner, which means the likeliness that they would stay in Estonia is much bigger. Today, one in five foreign students decide to stay in Estonia after graduating from university. However, the 80% who leave are not lost for Estonia. University is the place where friends are made for life. In addition, during their studies young people become aware of the cultural peculiarities of their home countries.

The Estonian language and culture will be preserved only if people are willing to continue to actively practice them.

A comprehensive approach and taking advantage of new technological capabilities will ensure the sustainability of small languages and cultures in an open world of migration and digital technology. A comprehensive cultural policy embraces the Estonian culture in all of its diversity (not merely professional and heritage culture) and contributes to the skilful integration of elements of other cultures. While the Estonian culture is based on the Estonian language, the bearers of culture, including the Estonians, will be increasingly proficient in other languages and interact more and more with people from other cultures.

The Estonian identity and culture are mainly defined through the Estonian language. The state of Estonia, or its territory, is not as important to young people’s identity as it is to their parents (Valk 2017, this Report). The modern transnational and open world, and a global and transnational Estonia have become the new normality for young people. The majority of young Estonians have a good command of English, and Estonian children and youth are very active internet users as compared to their peers in other European countries (Kalmus 2013). Thus, their activities, language, and cultural contacts are not limited to Estonia and the people living in Estonia. Today’s Estonia functions in three languages: Estonian is the main language of communication but Russian is still important in some regions, while the importance of English is growing in a number of social fields (Zabrodskaja and Kask 2017, this Report). In line with the digital age, new visual cultural languages are becoming more important (Torop 2017, this Report).

Good language skills form the precondition of interaction. While the English language proficiency of the Estonian population, in particular young people, is good, and young people are the active users of visual languages in the virtual space that both are important in today’s open world (Kalmus 2013), the census results reveal some problem areas. First, Russian-speaking youth have poorer English language skills than Estonian youth. Second, the knowledge of other foreign languages is rather poor. The other main foreign languages spoken are Finnish and some other European languages (German, French, and Spanish) to some extent. Children’s language skills should be more diverse than that. The goal is not that each child would speak a large number of languages, but the overall foreign language diversity among young people should increase. While English is the lingua franca of the open world, seeing that world and learning about it through English only is not sufficient. It is impossible for a company to expand to the Chinese market if none of its employees speak the local language. It is difficult to understand the nature of the Syrian crisis and the situation of refugees if we cannot communicate with them in their own language. In an open world and at the digital age the state should also invest in various language technologies that make the translation of texts easier, e.g. by cooperating with companies that have a business interest in such technology.

Estonia is widely known for its success as an e-country, in particular its e-services. As regards the digitization of culture and heritage and the consumption of culture through digital media, there is still room for improvement. We need to discuss what kind of support should be provided to the private sector; what kind of support is required for the emergence of new and innovative forms of culture that would help to transform digital forms of creation into a more participation-centred form of culture, and how to make it accessible to all Estonians across the world (Ibrus 2017, this Report). Estonian digital culture is the foundation of transnational Estonia, which makes Estonian culture accessible to all Estonians in all corners of the world. At the same time, digital culture offers new opportunities for integration in Estonia — new and interactive study methods, including new attractive learning materials for schools, — and also introduces Estonian culture to those living abroad and having no intention to move to Estonia.

In an open world and at the age of migration, the Estonian culture needs to have a wider horizon that includes self-identification and meaning creation from the people of different language and cultural backgrounds living inside and outside Estonia. The Estonian culture is all the more viable and attractive the wider the opportunities for meaning creation, and the better people’s skills of and opportunities for interacting with other languages and cultures, are (Torop 2017, this Report). While the language diversity in Estonia increases as a result of immigration, the Estonian culture will continue to be based on the Estonian language (Praakli 2017, Zabrodskaja and Mets 2017, this Report). We often equate the number of Estonians with the number of Estonian speakers. Obviously, these numbers overlap to a great extent but in today’s world this overlap is diminishing. Thus, the fact that the number of Estonians is decreasing in the territory of Estonia does not necessarily mean that the Estonian language and culture are becoming extinct — the survival of the Estonian language and culture depends not only on the demographic trends but in particular on its capacity to develop in both Estonia and abroad (Viik 2017, this Report). This requires both state support and the willingness of people to continue to actively practice them. However, a declining number of people makes it difficult to preserve a sufficiently diverse culture — a prerequisite for understanding the changing world and overcoming the challenges within it.

The future

Raivo Vetik concluded the previous Human Development Report (2015) with a botanical metaphor: to blossom you need roots. To enjoy the beauty of flowers you need to take good care of the plant: improving our general cultural literacy will significantly contribute to the survival of the Estonian language and culture (Marek Tamm, this Report). This includes the diversification of existing language skills, currently concentrated around Estonian, English and Russian (Anna Verschik, this Report); the increase in social cohesion (Anu Realo, this Report); the mobility capital required in an open world (Rein Ahas, this Report) and reducing the migration-dependency of the population and economic development (Allan Puur). At the time of the preparation of this Human Development Report, immigration resistance is growing in many European countries; as Anu Realo (this Report) aptly observes: the world in which we live is not what it used to be. Mass immigration brings back borders and border controls between countries that were already used to free cross-border movement of people. Allan Puur (this Report) asks: has the world become too open to migration? The residents of many European countries, including Estonia, feel that they are losing control over their life that in turn poses a threat to the democratic social order.

It is too early to say whether the current developments in Europe are just temporary, a breather, or the beginning of our journey towards a new more closed world than we have been used to. However, an important crosscutting message of this Report is that openness has played a significant role in Estonia’s success story and that the demographic, language and cultural survival should be interpreted with an open mind as well. This leaves the door open to flexible solutions or, as stressed in the previous Human Development Report, room for resilience (Vetik 2015). The task of preserving the Estonian language and culture, set out in the Constitution, concerns in its broader sense all policy areas, without exception. For the last 25 years, Estonia has been economic growth oriented, firmly believing in the free market economy; however, its approach to culture has been narrower than the objectives of the Constitution, focusing restrictively on professional and institutional culture (Tamm 2017, this Report). The perception that culture can become a focus of attention only after we have achieved the desired levels of economic growth and wealth is too simplistic. Rather, people’s language skills, the knowledge of their own and other cultures, intercultural relations, the skill of creating new cultural meanings, and social and economic development are intrinsically linked to each other. Therefore, contributing to the development of the Estonian culture — in its broadest sense, including its professional and all other forms — should be seen as a long-term investment into social cohesion and development, which contributes to the success of the Estonian economy as a whole.

The main policy measures for ensuring the demographic and cultural sustainability include the family, housing, migration, education, labour market, integration, and transnationality policies. As these are horizontal measures, ministries and authorities need to make a concerted effort to find the best solutions. The key to success is a knowledge-based approach, i.e. the background of the above policies, and fundamental and applied research are equally important. So far, the successive Estonian governments have focused on the development of a favourable economic environment, including physical infrastructure. The main challenge for the governments of the 21st century is to contribute to the development of human resources, taking into account the needs of the age of migration. Right now, the European Union with its aid programmes is doing this job for Estonia. Estonia needs to develop its own migration and human resource strategy. This concerns not only individuals but also companies. Strong companies that are firmly linked to the global supply chain and offer smart jobs that can contribute significantly to the long-term demographic and cultural sustainability of Estonia. The role of the state should be to provide support to businesses and to initiate changes. For this purpose, we need a more sophisticated innovation system than we have today, which promotes creativity, the development of a diverse linguistic and cultural base and the technological literacy essential in a digital era, across all layers of society.

February 2017

Table 1. The change of the human development index in EU member states

References

Åslund, A. 2007. How Capitalism Was Built: The Transformation of Central and Eastern Europe, Russia, and Central Asia. New York: Cambridge University Press.

Castles, S., de Haas, H., Miller, M. J. 2013. The Age of Migration. London: Palgrave Macmillan.

Eurostat 2017. Gini coefficient of equalised disposable income. Electronic database, accessible at: http://appsso.eurostat.ec.europa.eu/nui/show.do?dataset=ilc_di12.

Kalmus, V. 2013. Children’s safety in the new media environment. The Estonian Human Development Report 2012/2013: Estonia in the World (ed. M. Heidmets). Tallinn: Eesti Koostöö Kogu, 83−85.

Piketty, T. 2014. Capital in the Twenty-First Century. Harvard: Belknap Press.

Vetik, R. 2015. Summary: Estonia’s Post-2015 Development Model The Estonian Human Development Report 2014/2015: Avoiding pitfalls? (ed. R. Vetik). Tallinn: Eesti Koostöö Kogu, 294−301.