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

This paper estimates the causal effect of a job search support programme on the employment of asylum seekers in Germany. Asylum seekers typically need longer than other migrants to be successful in the host country's labour market. Individual skills such as education and labour market experience certainly play an important role. In addition to that, the job search process itself requires skills and institutional knowledge, which may be scarce among some groups, e.g. among newly arrived immigrants, non-economic migrants in particular. We believe the role of these frictions is an aspect that is very much understudied. We attempt to provide a rigorous evaluation of a program that aims at easing matching frictions. In particular, we design a field experiment to evaluate whether easing matching frictions affects the labour market integration of recent refugees in Germany. We interview around 400 job-seeking refugees attending job-counseling sessions of a Munich-based NGO. The participants are then randomly allocated to the treatment group and the control group. For the treatment group, the NGO identifies potentially suitable employers and, upon agreement of a job-seeker, sends a CV to those employers. This treatment can isolate the effect of frictions concerning the job search process, while it has no effect on the underlying skills of participants. We track individuals over time by conducting follow-up surveys of both the treatment group and the control group every six months. Preliminary results based on a limited sample show positive and significant treatment effects on employment after twelve months. Working with the full dataset, we will investigate the heterogeneity of treatment effects across skill groups and legal status, and the possible tradeoff between early employment and match quality.