WeLaR > News > Sommerfeld paper finds refugees boost labour demand in Germany

Sommerfeld paper finds refugees boost labour demand in Germany

The inflow of refugees to Germany in 2015-2016 increased demand for labour from native workers, creating one new job for every 2.4 newcomers, a discussion paper co-authored by WeLaR researcher Katrin Sommerfeld from ZEW – Leibniz Centre for European Economic Research found.

“The Labor Demand Effects of Refugee Immigration: Evidence from a Natural Experiment”, which Katrin Sommerfeld co-authored with Paul Berbée, Herbert Brücker and Alfred Garloff, shows that the accommodation of refugees benefited not only the migrants but also the host regions. Migration created new employment opportunities for the native population, especially in services such as accommodation, social support and assistance with asylum applications.

The study demonstrates that migration had a more positive effect on women’s employment than men’s. Furthermore, while employment among men grew at about the same rate as unemployment fell, unemployment among women decreased much less. This can be explained by the engagement of women entering (or re-entering) the workforce in response to the demand. Moreover, locals with a low level of education and former migrants benefited significantly.

The positive employment effects weakened over the long term. Three years after refugees’ arrival, almost 50% of the initial increase in employment had disappeared. This occurred as migrants’ behaviour as consumers changed over time: many no longer received all the support they initially relied on, as they may have found jobs and begun paying for accommodation and everyday goods on their own.

The paper is available here.

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