Job opportunities are more important to refugees from Ukraine than social benefits

Ukrainian refugees prefer countries with better job opportunities to countries with higher social benefits. This is the finding of a recent study by the ifo Institute, which surveyed over 3,300 Ukrainian refugees in Europe. “The prospect of a job that matches their qualifications and a higher wage level has a much stronger effect on refugees than social assistance or child benefits,” says Panu Poutvaara, Director of the ifo Center for Migration and Development Economics. “We see that wage differences play an almost four times greater role in the choice of destination country of Ukrainian refugees than differences in social benefits. That, of course, does not mean that social benefits play no role at all.” 

In a hypothetical scenario, respondents were asked to choose between two countries with different characteristics. The decisive factor was whether the country promised better job opportunities or higher wages. Respondents were 15 percentage points more likely to choose the country with better job opportunities. A country with an average wage that is 500 euros (570 USD) higher was 9 percentage points more likely to be chosen. Job opportunities and higher wages are decisive factors also to refugees who are currently unemployed. They apparently plan to enter the labor market in the future. In addition, friends or family in the destination country are 8.5 percentage points more important than immediate geographical proximity to Ukraine. Intentions to return also play a role. Refugees who plan to settle outside Ukraine in the long term prefer countries further away with economic advantages over countries where family and friends are located. 
 
“Understanding why refugees choose certain countries is crucial for designing appropriate policies nationally and internationally,” says Yvonne Giesing, Deputy Director of the ifo Center for Migration and Development Economics. One example of this is the debate about cutting social benefits to make fleeing to certain countries less attractive. However, the study shows that higher wages and easier access to suitable jobs are a greater incentive for refugees than social benefits. Therefore, cuts in social benefits are likely to have little effect. “Cutting government aid could also have a negative impact on integration in the long term,” says Giesing.