Curbing the brain drain: Enrico Letta at work to reform the European single market

Brussels – A former Italian prime minister is trying to correct a typically Italian (but not only) problem in Europe. The brain drain to member countries that offer better job and life prospects is a crippling of the European single market that needs to be straightened out: Enrico Letta, who Brussels has tasked with drafting a high-level report on the future of the EU’s internal market, is trying to do just that.

A phenomenon of mass emigration of skilled young people that Italy shares with the southern and eastern countries of the bloc: in 2021, 27 percent of those who left their country for work came from Romania, 12 percent from Poland, and 10 percent from Italy. In an interview released to Politico magazine, the former secretary of the Democratic Party, now president of the Jacques Delors Institute, summed up his task with a slogan: “Until now we had the single market as freedom of movement. That was the center of everything. I would like to add the freedom to stay,” he said.

The mobility guaranteed by the single market and the Schengen area offers extraordinary opportunities, but at the same time weakens the regions most in need. According to ISTAT (Italian National Institute of Statistics) data, between 2011 and 2021 there have been 377,000 Italians between the ages of 20 and 34 emigrating to economically stronger EU countries. And at a European level more and more highly skilled young people are packing their bags: in 2021, 32 percent of Europeans who left their home countries were highly educated, up from 28 percent in 2016.

To reverse this trend, the June 29-30, 2023 European Council called for “an independent high-level report on the future of the single market to be presented at its March 2024 meeting.” It then chose Enrico Letta for the task.

Next spring, after a tour of European capitals, the former premier will point to opportunities to overhaul the single market. Not only measures to prevent poorer countries from seeing their young people flee, but also European rules on state aid.

Letta clarified that “state aid is an exception and must remain so.” In recent years, due to the pandemic, Russia’s war in Ukraine, and the energy crisis, Brussels has loosened the rules governing emergency state subsidies, exacerbating the gaps between weaker countries and more powerful economies such as Germany. Of the state aid notified to the European Commission by the 27 member states under the Temporary Crisis and Transition Framework, as much as 47.2 percent was for German companies.