The Labour Market Integration of Refugees in Germany: Evidence from a Field Experiment

Tasks

From 2015 to 2016 over one million refugees arrived in Germany. Their labour market integration is challenging for several reasons: their lack of job-related skills (including language), qualifications, and task-specific human capital have hindered refugees' labour market integration. Moreover, they face matching frictions, a suboptimal network, residency requirements and legal barriers that may be larger than for natives or other migrants.

Methods

The project designed a randomised controlled trial to evaluate the role of matching frictions in the employment prospects of refugees. In a first step, personal interviews were conducted with approximately 400 job-seeking refugees in Munich and data on their job search behaviour, their job expectations and experiences, their education, skills and social integration was collected. Subsequently, all participants were provided with a German CV and basic job search information. In a second step, half of the participants were randomly selected and added to the database of an NGO, which sends CVs directly to employers. This intervention aimed to isolate the effect of matching and information frictions, while having no effect on the underlying skill set of refugees. The results of follow-up telephone surveys show a positive and significant treatment effect of 13 percentage points on employment after twelve months. These effects are concentrated among low-educated refugees and those facing uncertainty about their residence status. These individuals might not search effectively, lack access to alternative support programmes, and may be disregarded by employers due to perceived higher hiring costs.

Data and other sources

We collected new data through face-to-face and telephone interviews with refugees.

(Revise and Resubmit at Labour Economics)