And I think that this is a big problem for Europe, because the language and social barriers make it harder to move. It would be interesting to compare the fraction of "foreigners" in a theoretical federal Europe to that of "out-of-staters" in the US.
So, unless there was a big increase in immobility of European labor since 1980, it can't be the whole answer.
It could be, though, that labor immobility is interacting with something else (some aspect of globalization?) that keeps unemployment high.
Again, while your observation of the situation in Europe may have been true in the past, the situation is turning round, even more so with the new accession countries. Movement to cover shortages of skills is now happening, despite the attempts by some countries to restrict it. The postition should speed up considerably once the transitional arrangements for the east in some of the more protectionist markets expire. Remember the scare figure in the recent French referendum debates was the "Polish plumber", shorthand for these newly available skilled workers.
The UK fully applied the freedom of movement and work provisions from May last year, with the exception of welfare benefits. I have seen this have immediate effect as the block I live in used a contractor employing (wethink) Hungarian painters. The new digital aerial (antenna) system is being installed by contractors from Portugal who are gaining experience here so that they can get contracts for similar work back home.
