Politics & Policies

Labour Market Integration of Refugees and Asylum Seekers – An account of key information on Austria, Sweden and Germany

First session: “Opportunities for better labour market integration: Lessons from national experiences”

During the session presentations of experiences from three Member States were delivered and discussed: Austria, Sweden and Germany. All the three countries are facing challenges of integrating refugees, even if the number of asylum applicants has substantially decreased since the peak year of 2015.

In Austria, for example, after the very high level of about 89,000 asylum seekers who applied for asylum in 2015, in 2016 their number declined to 44,000, and in 2017, during the first two months of the year their number stood at 4,000 (during the same period in 2016 it was 11,000). Unaccompanied minors make up about 11% of total applications – this is apparently one of the highest percentages in Europe.

As regards integration challenges, although the Voluntary Integration Year looked promising in Austria last year, up to now, 173 people have started the programme and, only 5 finished it. The requirements for this were too strict (e.g. language and qualifications).

Important changes in legislation were introduced in the country in Mid-May of 2017 (at the time of preparing this working paper): Labour Market Integration Law and Integration Law were adopted on 16th of May. There is a distinction between recognised refugees and beneficiaries of subsidiary protection on the one hand, and asylum seekers with high probability to stay. The first two groups are obliged to participate in the so-called integration year, starting already from September 2017, whereas programmes for the asylum seekers may start in January 2018, and depend on budgetary resources.

The changes include for example that for the first time it would be the public employment services (AMS) which is to be responsible for providing labour integration measures for asylum seekers with a high probability of staying in the country (see more details in Vidovic).

During the discussion, it was mentioned that a lot of data are collected on integration measures, and these are conducted by various Austrian institutions, including both monitoring/evaluation activities that are part of practical projects as well as dedicated research activities. Thus, following two pilot surveys, a group of institutes is developing a follow-up panel survey which not only covers labour market integration, but also other aspects, such as social services, including housing, health and education. In terms of non- research-oriented data collection, the Youth college (Jugendcollege) project was mentioned, which is accompanied by an extensive data collection internally. This could be used for studies/internal evaluations. In a similar vein, analyses of results of the so-called “competence checks” implemented by the public employment agency, AMS (Arbeitsmarktservice) are already undertaken. A qualitative research focusing on Afghan and Syrian refugees, implemented by ICMPD (Perspekt), is starting now – perspectives on employment and training are to be examined and the investigation will be based on observed difficulties and challenges people face, concerning longer-term vocational training and placing refugees elsewhere than Vienna. In addition, a best practice collection is also envisaged. Within this exercise, practices in Sweden and Germany will also be examined. Respondents will be asked about their expectations, and return migration will be an important subject of research, as well as experiences at the workplace such as discrimination will be investigated. These will be extensive studies, but most of them have just now started.

As regards the planned new legislative changes, to some extent, they are prompted by evidence. Thus lessons learnt from experiences with the competence checks were part of policy learning: it has been recognised by now that the public employment services (AMS) should be more proactive to assess the profile of refugees. Many of the changes, however, seem to be driven rather by the large inflow.

It remains to be seen what will be the results of the so called “b. mobile” activity (see Vidovic, 2017, slide nr. 4), which is a nationwide apprenticeship placement in Austria. Apprentices are lacking in the Western and Southern part of Austria, whereas many young people arrived to Vienna. So the aim of the scheme, which is supported by the Chamber of Commerce, is to convince those refugees who went to Vienna, to settle rather in those parts Austria. For this, from its part the Chamber of Commerce tries to persuade its members in these provinces to employ refugees. As regards the apprenticeship system, at least when persons start their training there, the training is placed somewhat between school education (i.e. not remunerated) and work – in other words, it is not considered proper employment. The remuneration is thus more like an internship subsidy, and the tacit expectation is that apprentices still stay with their parents and thus do not need to cover food and lodging.

In relation to experimenting with various policies and measures, a participant voiced his impression that a lot of policies are being tried out in different places of Europe, and there has not been much coordination as yet between the different schemes and learning from each other in a systematic way (i.e. what works and what does not). There are, however, regular exchanges between public employment services (PESs) in Austria and Germany (twice a year).

In realising the importance of starting integration support measures as early as possible, asylum seekers are also increasingly considered as target groups and a differentiation made between those who have a high probability of staying and those, who are not. What the exact criteria are to determine this group is not defined in law. Presumably, the 75% threshold used for relocation will be a possible yardstick, but in any case, the authorities applying it have a considerable discretion, not least since integration support measures can be offered, but there is no entitlement.

It was also discussed what restrictions asylum seekers should face in accessing higher education. Although in principle they have an access, but in practice, very few, if any will be able to meet the conditions (e.g. proof of a comparable university place in the country of origin, no subsidies for German language training, etc.)

In Sweden, according to a recent media report, last year the number of economically active persons increased by almost 250 thousand people, and almost all the newly created jobs were taken up by foreign-born people. The country received many asylum seekers in recent years, including a very high number of unaccompanied minors. Despite many new integration measures for recognised refugees, a source of concern could be that a lot of those asylum seekers, who are rejected will eventually stay – their living conditions and chances for joining the labour market could be a subject for future and further research.

In Sweden, most social benefits and services are residence-based, meaning that they are available for anybody who is legally residing in the country, including beneficiaries of international protection. The Swedish government has, however, recently changed its policies concerning this group. Earlier, almost everybody who was granted protection could get a permanent residence permit, but now temporary residence permits are issued for them, meaning that recognised refugees can get a permit for 3 years, whereas beneficiaries of subsidiary protection, can get it for 13 months (more than 1 year, so that they can access social benefits, health care and make use of integration arrangements). However, despite the initial temporariness, if a person finds a job and can support him/herself, s/he can get a permanent permit, meaning an exit from the temporary asylum status. This obviously means a strong incentive to find a job. Trade unions have, however, warned that in a desperate job search, these people could accept almost any job offer, which could aggravate their vulnerability and increase exploitation (poor working conditions and/or low salaries). On the other hand, within the context of better and quicker labour market integration, the current debates in Sweden also raise the issue of a possible conflict of political objectives. Despite the incentives for job search, some recent restrictions, like the granting of temporary permits and restricted rights to family reunification, could have an unintended, opposite effect on labour market integration, since separation from family members and insecure residence statuses can divert refugees’ attention away from focusing on integration (it is obviously easier to focus on it, when one has a secure, permanent status).

As regards the fast-track initiatives for refugees into shortage occupations in Sweden, they are largely regarded as successful (especially in certain professions, such as health-care jobs). It has to be acknowledged, however, that the initiative has so far benefitted a relatively low number of people (2804 newly arrived refugees). The initiative also requires a lot of resources both from the employment services and the employers themselves (for example, as part of the initiative, after having worked for a company for about 3 months, people get assessed by the employer regarding their qualifications, and even if the companies are paid for that by the state, this means they must have a mentor or supervisor in place, a person who assesses the performance of the newly arrived persons).

Answering to a question, it was confirmed that in Sweden in principle it is possible for rejected asylum seekers to achieve a legal status change through finding a job, but this has concerned a small number of people so far; most likely because the negative decisions are usually quite quick and people do not have time to find a job, before the decision on the refusal of their application is taken (especially people who came from countries which are regarded as safe often get a negative decision rather quickly). The idea behind the status change measure was not of a humanitarian nature, but rather to make it easier for employers to retain their staff even if they are initially rejected as asylum seekers.

At the same time, the government is considering introducing another type of status change, which targets unaccompanied minors, with the aim at enabling them to go to school, meaning that when they enter secondary schools and perform well, they can get a permit to finish their high school education and find a job afterwards.

As regards the fast-track initiative, language learning is still part of that, in a more targeted manner, towards specific professions. Courses are adapted to specific skills profiles. There are, for example, specific language courses for academics in the bigger cities. The fast-track initiative is not a separated scheme; integration courses are still part of the integration plan that every beneficiary of protection is offered.

In Sweden, the public employment agencies have traditionally a strong role in labour market integration of migrants, including refugees. The results are, however, mixed, even if a lot of additional funding was made available for them. As regards the individual integration plans, its effectiveness seems to depend in part on the workload of the local branches of the employment agencies and the local labour market characteristics: it could be efficient, but in those localities where the staff members are overburdened, there is very little time left for the individuals.

During the discussion, the differences between Austria and Sweden were touched on, as regards wage subsidies. It seems that in Austria the employability of refugees was in focus in the provision of services by public institutions, whereas in Sweden it was realised that if labour market integration of refugees is a public good with positive externalities, the state should invest in it, hence the higher role of wage subsidies. An OECD study was quoted which concluded that in Sweden wage subsidies proved to be effective in facilitating the labour market integration of refugees. It is, however, a controversial issue since it also matters how employers use the subsidies. It was also mentioned that even if they don’t continue to hire refugees when wage subsidies have expired, that work experience could still be beneficial for the refugees to find other jobs. In case of Austria, it was confirmed that wage subsidies do not play a significant role; only 5% of persons who were registered with the PES, got these.

Recently (compared to 2015 and 2016, respectively) more women asylum seekers arrived to Sweden, presumably because of restrictions of family unification (they now tend to arrive themselves as asylum seekers and not as family members). This results in a more equal gender balance among asylum seekers.

Within the context of families, during the discussion the example of Armenia as a host country of Syrian refugees was mentioned. Armenia provided a humanitarian corridor for Syrian refugees by issuing entry visas in Armenian Consulates in Syria. Therefore, many of the refugees came by plane. They were able to keep their own resources – which were regarded as collateral for banks for giving loans for setting up a business. Linked to this, about half of those individuals, who are employed in Armenia, own a business, or planning to start one. One of the reasons why they did not want to move within Armenia is that they did not want to leave their relatives in the cities where they have been settled. Families could have an important role not only when setting up a business, but also in job search: according to a survey in Armenia, 40% were looking for jobs through friends and relatives (an important network they can rely on). Family approach is therefore also important in research, besides focusing on individuals.

In Sweden the focus is more on employment and less on setting up a business, therefore access to loans for that purpose is not high on the agenda at the moment but should perhaps be promoted.

As regards lessons learnt in Germany, the key question is how these lessons could be assessed. From a budgetary point of view, the net effects of labour market integration is important, so the balance between costs and outcomes. According to past experiences, in Germany, 8% of refugees have a job in the first year of integration, and 50% after 5 years and 70% after 15 years. One of the lessons is that when labour market integration is assessed, the overall economic situation is often underestimated. It has to be taken into account that success of labour market integration depends much more on the capacity of the labour market to absorb additionally large number of people than on direct measures. This should be looked at from a quantitative perspective, and also from the point of view of a qualitatively matching economic environment (for example, skill match). The reason is that as regards refugees, the receiving country has no opportunities for steering (i.e. influencing the skill pattern of the new arrivals), whereas in migration policy, a steering mechanism is in principle could be in place. The specific measures have certain limitations, since integration takes time (depending very often also on the profile of refugees).

Although the German economic situation is now favourable, success depends on the vacancies and their composition. In addition, many other groups now need jobs: long-term unemployed, youth unemployed, other migrant groups. You can give vacancy to one person only, so it is inevitable that one person, or two, will be left behind.

Another important question is when the intervention should start. Even if early intervention is common sense, one could ask whether the intervention could begin earlier, for example establishing reception centres in Africa with profiling, self-assessment, external assessment. So the question is whether it makes sense to start this process already before arrival, or because the destination countries are so different from the countries of origin, this is not worthwhile.

A third question is in what order the integration process should be pursued, for example, in a linear way, in pre-defined sequence A, B, C. In Germany, some courses/measures are conducted simultaneously. Another dilemma is motivation. If refugees are motivated to start work immediately so that they could earn money as soon as possible in order to pay back the money they owe to traffickers, or transfer it to their families, they are not interested in a three- year apprenticeship scheme. Importance of the traumatic experiences the refugees have undergone, i.e. mental health issues are also often underestimated from the perspective of their ability to focus for example on a 6-8-hour language course. The high drop-out rate may be linked to trauma.
As regards the dual apprenticeship which is highly regarded, it is either passed or not; partial qualifications are not accepted (it would raise a lot of problems with trade unions and chambers).

The dilemma of mainstream vs. targeted measure should also be considered. In Germany, the public employment services are not targeted at certain specific groups. In profiling, the individual’s distance from the labour market is assessed and the socio-economic characteristics are not taken into account. In case of refugees, however, this mainstream approach has been given up, and the German PES has targeted measures, designed for younger, the elderly, for women. With the refugees, this approach worked.Another question is whether the measures should be provider-based or cooperation models with the enterprises should be preferred. The latter might have been an easy answer, but it turned out to be not as simple. Companies have usually a procedure in place how to hire new employees, with workers councils and other stakeholders (trade unions) having a voice in that, and they make sure that no-one could get a privileged position in the process: all the defined criteria should be met by all the applicants. Due to these strict rules especially in larger companies, the first approach to turn to them has failed. So the initial approach has shifted towards the small- and medium-sized companies (SMEs) – PES appeals to SME employer association and cooperates with them. As regards bigger companies, however the employment services turn to them for asking apprenticeship places, which they are willing to offer and increase those.

The German PES has recently directed increased investment towards developing an IT-based system (not only were new apps developed, but their job portal with vacancies was also translated to the most common languages of the refugees). In addition, in order to better communicate, the competence assessment tools is based on pictures and not verbal communication. A translator call centre has been created as well. The capacity of the German PES has been expanded for example by hiring an additional 2,800 staff, and invested a lot in qualifications, a guidance services (i.e. competences to conduct guidance interviews) plus intercultural competences and also in skills how to communicate with traumatised people.

Finally, some experiences from Germany were shared on those (or related) questions which have already been asked and discussed within the context of the other two countries. As regards specific treatments, concerning for example exemption from minimum wage, although there were some requests from some industries to do that for long-term unemployed and refugees, this was rejected. In terms of wage subsidies, even if research shows it could be successful, if the issue is looked at from the perspective of sustainable integration, there is no clear evidence as to what extent wage subsidies could really help.

Two points were raised for further discussion and perhaps also for future research: the first concerns the role of refugees themselves in their own (labour market) integration; to what extent their participation can be enforced? The question is not only about values. Formal qualifications are definitely needed for successful, sustainable labour market integration especially in Germany and Austria. The question is, however, how much refugees could be obliged for achieving a formal qualification, how this could be enforced, whether sanctions are needed for those who do not achieve that. It is still open what can be regarded as successful integration. Even if it can be measured, the question is what the benchmark is. For example, after having participated in an active labour market policy measures, the integration rate can be measured; as regards the long-term unemployed, it is 25%. This means that 75% of the cases, if there had not been any measure in place, the same result would have appeared.

At the moment in Germany there is no effect of the inflow of refugees on the overall labour market, all the less so, because now most of them are not really getting into the labour market. The estimated number of those people who were recently getting into the labour market is about 30,000 – 40,000 – this is marginal, if it is taken into account that in Germany the total number of employed people stands at 42 million. It was clarified that the public employment services are not focusing on treating people with trauma, since that is not their job, but it was found that during labour market-related interviews, the interviewers should be sensitive towards the issue.

As regards pre-screening, not doubt that integration is needed, the question is not IF, but rather WHAT (to do). It was just an idea, that perhaps it would be easier for some countries to accept those refugees whose profile matches their labour market needs.

There is a recognition law in Germany and it is part of the process that when the recognition is not given, the authorities should inform the applicant what is missing. In this way, it could be established what should be done to achieve full recognition.

Subsidies are not target group-related. In principle, all active labour market policy (ALMP) instruments in Germany are for everyone, and this has not changed. As long as the person fulfils the general criteria, does not matter what group that person belongs to.

During the discussion, it was emphasised that over-emphasis in language training should be avoided, since without linking it to jobs may result in the deterioration of the acquired language skills, since the refugees who participated in the language course may forget what they have learnt.

Chosen excerpts by Job Market Monitor. Read the whole story at Labour market integration of refugees and asylum seekers: current status and future needs for research

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