Europe and Central Asia’s economic growth is underway, but the World Bank in a new report warns of challenges with flexible employment contracts, technology and handling of immigration.

Annual GDP growth in Europe and Central Asia will reach 2.2% this year, the strongest growth in the region since 2011, according to the World Bank’s latest regional economic update report. Stronger industrial production and exports have lifted most countries in the region out of recession, and unemployment rates have dipped below pre-crisis levels.

“Growth is returning to the region, which is certainly good news,” said Hans Timmer, World Bank chief economist for Europe and Central Asia. “At the same time, however, new technologies that provide new growth opportunities are bringing about more flexible labor contracts and more uncertainty. This has increased anxiety among people. And recent concerns over the influx of refugees can be seen as a manifestation of the heightened anxiety.”

Technologies are impacting distribution of wealth; many workers are struggling to adjust to the new demands for digital skills, according to the report.

It also says the number of full-time, traditional jobs have declined as a share of total employment. Flexible contracts have become the dominant employment arrangement for younger workers. And while flexible contracts can increase the efficiency of companies and individuals, they are also creating new forms of inequality and insecurity.

In addition, the region has seen a share increase in numbers of refugees and asylum seekers — to 6.4 million in 2016 from 3.7 million in 2014. Migration plays an important role in meeting demand for labor and also promotes transfer of knowledge, according to the report. But countries must pursue policies to fully take advantage of the benefits of immigration, and reforms should aim to help both migrants and nonimmigrants cope with rapid technological change and increased labor market flexibility.