While the potential length of stay of Ukrainian refugees in their host countries is uncertain, many of the working-age adults will seek to work during their stay.
In general, refugees face specific labour market integration challenges compared with other migrants. Relative to other refugees, Ukrainian refugees have some characteristics that facilitate their integration prospects (e.g. educational profile, existing social networks, immediate access to employment), while others may, on the contrary, hinder them (many are single mothers with children and other dependents).
Although the projections are made in the context of high levels of uncertainty, for all European countries together, the labour force is expected to increase by about 0.5% by the end of 2022. For individual countries, the largest increase is found in three countries: the Czech Republic (2.2%), Poland (2.1%), and Estonia (1.9%).
The estimated effect on employment show a similar ranking of countries, with the Czech Republic, Poland and Estonia exhibiting a significant increase of at most 1.9%, while the overall impact across all European host countries is estimated to be 0.4%.
The overall estimated impact on labour force is about twice as large as that of the 2014‑17 inflow of refugees to the European Union. Most of it will be observed in a few countries (in relative terms, Czech Republic, Poland and Estonia) and, given the differences in migrant profiles between 2014-17 and today, with more women and more high-educated, the most affected labour market segments will be different – likely less unskilled manual labour and more service occupations.
Russia’s large-scale aggression against Ukraine started on 24 February 2022 has generated a historic massive outflow of people fleeing the conflict, unseen in Europe since World War II. While it took two years to reach 3 million Syrian refugees, this figure was reached in less than three weeks for Ukraine. According to the office of the United Nations High Commissioner for Refugees UNHCR data, as of 19 July 2022, close to 6 million individual refugees from Ukraine were recorded across Europe – a large majority being women and children – with the largest figures in countries neighbouring Ukraine. There are an additional 7 million people internally displaced within Ukraine.
While there is much uncertainty regarding the potential length of stay of these refugees in their host countries, many of the working-age adults will seek to work during their stay. This brief provides estimates of these potential labour market entries. Since many determinants of activity and employment among Ukrainian refugees remain unknown, these estimates are conditional on a number of hypotheses regarding age, education and speed of labour market integration.
This brief reviews the distribution of Ukrainian refugees across European countries and their demographic characteristics. It discusses the existing evidence about the labour market integration of refugees, and applies this information to the case of Ukrainian refugees to provide estimates of the number of them being active and employed in European countries by the end of 2022. Finally, it compares these results to the impact of previous large inflows of refugees, in particular the 2015‑17 arrivals.
UNHCR data indicates that border crossings from Ukraine were particularly high during the first month of the conflict, reaching more than 150 000 people daily during almost two weeks between end-February and early-March. Since the end of March, border crossings from Ukraine have averaged around 50 000 people per day, while the number of people going back to Ukraine has progressively increased, averaging 30 000 people per day since May. By mid-July 2022, 5.8 million net crossings from Ukraine had taken place (Figure 1).
According to UNHCR data, as of mid-July 2022, 3.7 million Ukrainians had registered for temporary protection or similar national protection schemes in Europe. With more than 1.2 million beneficiaries of temporary protection (BTPs), Poland is by far their main destination country, followed by Germany (670 000), the Czech Republic (396 000) and Italy (143 000). While Ukrainian refugees initially fled to neighbouring countries – and many remain in these countries – secondary mobility has been on the rise and the number of Ukrainian refugees in countries that are farther away from Ukraine is increasing.
The general mobilisation in Ukraine prevents most men aged 18 to 60 from leaving the country. As a result, mostly women with children and some elderly people – but very few working-age men – have left the country so far. In Poland, for example, according to the Office of Foreigners, out of the 1 million registrations by 22 April 2022, 48% were minor children and 92% of the adults were women. In Lithuania, about 42% of all Ukrainian refugees are minor children and 83% of the adults are women. Similarly, in Moldova, according to the UNHCR, out of the more than 100 000 people who had decided to stay in the country by mid-April, minor children accounted for 50% and women for 80% of all Ukrainian adults.
Countries further away from Ukrainian borders have apparently a slightly lower share of child refugees, ranging between 32% (e.g. France and Greece) and 40% (e.g. Czech Republic and Belgium). In Spain, for example, 36% of all Ukrainian refugees registered by 30 April were below 18 years old and 75% of all adults were women (9% of adults are over 65). Similarly, about 35‑36% of Ukrainian refugees in Italy and Portugal, as well as Estonia and Latvia, are minors.
The limited information currently available on the level of education of Ukrainian refugees suggests not only that a higher share of them are tertiary educated than among other refugee groups, but that they are also more highly educated than the general Ukrainian population. In the working-age population of Ukraine, in 2020, 56% of the women and 43% of the men were tertiary educated (Figure 2, Panel A). While there are no systematic figures on the socio‑economic characteristics, notably from EU countries neighbouring Ukraine, there is some information available for individual host countries. A survey of Ukrainians refugees carried out in Germany by the Federal Ministry of the Interior and Community in the third week of March found that among all adults surveyed, 73% had tertiary education, 19% upper secondary education and 7% had low levels of education. In Spain, 61% of all registered adult Ukrainian refugees have a tertiary diploma, 11% have upper secondary schooling and 25% have a professional qualification, while less than 1% are without any education (Figure 2, Panel B).
Compared to other categories of immigrants, refugees typically face specific hurdles to integrating the labour markets of host countries. Due to the forced nature of their migration and the traumatic experiences frequently associated with it, they often suffer from psychological distress and disabilities. As they have not chosen to migrate, they generally have had no opportunity to prepare for their life in the new country, especially by starting to learn the language. They generally arrive with weak, if any, attachment or link to the host country: they have gained qualifications in a different education system and work experience in different labour market conditions. Moreover, many are not able to provide proper documentation that would certify their level of education or skills. In addition, refugees often arrive in the context of large‑scale inflows, which means they compete with each other for employment.
Not surprisingly, refugees often find it particularly difficult to enter the local labour market and their outcomes generally lag well behind those of other migrant groups. Not only do they suffer from multiple disadvantages compared to other migrant groups (they have typically lower education levels and greater language difficulties), they also tend to perform less well in the labour market than other migrant groups who have otherwise similar characteristics . Data for the European OECD countries show that – after controlling for other relevant individual characteristics – refugees have employment rates that are 23 percentage points lower than their peers who have come as labour migrants .
Mastery of the host country language is crucial to succeed in local labour markets and to utilise previously acquired qualifications. It is also a precondition for participating in society at large. It brings greater social contacts with native speakers and higher likelihood of pursuing higher education opportunities and moving within the country. Refugees have little or no time to learn the host country language prior to arriving and may have low education levels that hinder language acquisition.
Highly educated refugees trained abroad face difficulties in having their qualifications recognised and valued on host country labour markets. These markets tend to devalue foreign qualifications, which affects employment, leads to over-qualification and reduces wages .
Another element of refugees’ vulnerability is a lack of networks or understanding of labour markets, which affects their ability to seek jobs and access recruitment channels, even when their qualifications are at least comparable to those of their native‑born peers. They are at an obvious disadvantage when it comes to knowledge of the host country’s labour market and hiring practices, and with respect to contacts, direct or indirect, with employers.
From the perspective of employers, hiring refugees may represent a risk as they may face difficulties in assessing the skills that they possess, in terms of formal qualification, previous professional experience and, more generally, in understanding their abilities and motivation .
Ukrainian refugees do not fit the typical portrait of refugees: some of their characteristics are likely to improve their integration prospects, while others may, on the contrary, hinder them.
First, as noted, a relatively high share of Ukrainian refugees have a tertiary level of education. In itself, even though these highly educated refugees may not be able to find jobs corresponding to their qualifications, this should improve their employment prospects. They should also be better equipped to learn the language of their host country than low-educated or illiterate refugees.
Second, in recent years, Ukraine has become one of the main origin countries for temporary migrant labour for a number of Eastern European labour markets, including countries where Ukrainian refugees have fled. This is of course the case of Poland, which was the main destination of temporary migrants from Ukraine before the war. In 2017, more than 90% of the 1 121 000 new temporary labour migrants in Poland were coming from Ukraine, mostly to fill vacancies in agriculture, construction and industry . In the late 2010s, Ukrainians were also among the top groups of newcomers in other European countries, such as the Czech Republic, the Slovak Republic, Hungary, Estonia, Latvia or Lithuania. In addition, between the beginning of Russia’s temporary occupation of Crimea and Donbas in 2014 and the 2022 large-scale aggression, more than 80 000 Ukrainian nationals have applied for asylum in EU countries. About 80 000 Ukrainians study abroad, one‑third of them in Poland and several thousands in other EU countries (e.g. Germany, the Czech Republic, the Slovak Republic, Austria). All the Ukrainian refugees with a prior experience of living and working in the EU are much more likely to find a job quickly in their host country, especially if they have learned the language. Even for the Ukrainian refugees who have not personally already worked or stayed in the host countries, thanks to information sharing in social networks, there is at least a higher probability of having some familiarity with the functioning of the labour market of these countries, also fostered of course by geographic and cultural proximity.
Third, at the end of 2020, 1.35 million Ukrainian citizens held a valid residence permit in an EU country, representing the third-largest group of third-country nationals in the EU. More than 500 000 Ukrainians were already in Poland, 223 000 in Italy, 165 000 in the Czech Republic, 95 000 in Spain, 80 000 in Germany, 58 000 in Hungary, 40 000 in the Slovak Republic, 31 000 in Lithuania, 29 000 in Portugal, 19 000 in Greece and 15 000 in France. These figures do not include Ukrainians naturalised in EU countries – about 100 000 over the past decade, according to OECD statistics. This large Ukrainian diaspora in the EU can represent a key resource for the refugees: a significant number have relatives or friends already living in EU countries who can help them find an accommodation and search for employment. Those who do not have direct connections to people already living abroad, can also benefit from the solidarity of the extended network of their compatriots.
Fourth, EU countries have taken unprecedented measures to facilitate the entry and stay of Ukrainian refugees, including by enacting for the first time the Temporary Protection Directive (TPD). Outside the EU, many countries have also taken significant measures to welcome Ukrainian refugees . In most EU Member States, those granted temporary protection have the right to work without any restrictions or delay as soon as they get a residence permit or, in some countries, a provisional certificate. This is also the case in a number of non-EU OECD countries, where Ukrainian refugees are entitled to work immediately. It is now well understood that extended periods of waiting for asylum decisions without being entitled to work are very detrimental to the employment prospects of refugees ;. In the case of Ukrainian refugees, having the right of working upon arrival in the host countries will certainly improve not only their immediate access to the labour market, but also their long-term employment prospects.
Fifth, some of the main host countries of Ukrainian refugees in Europe are confronted with structural labour shortages due in part to their current demographic situation. As a result, they had, before the start of the war, very low unemployment rates (Figure 3). In March 2022, Poland, Germany and the Czech Republic all had unemployment rates below 3%, reaching as low as 2.4% in the Czech Republic, much lower than the levels observed in the early 2010s in these countries and well below the EU average (6.2% in March 2022). Although the broader economic impact of the war in Ukraine may affect employment prospects at some point, most Ukrainian refugees find themselves in countries with very tight labour markets and even shortages in a number of occupations and sectors.
The main parameter that may work against a relatively favourable context and may hinder the employment prospects of Ukrainian refugees is the fact that many of them are mothers with children. For those accompanied by babies and children below school age, care work will seriously hinder their ability to enter the labour market, at least while they have not identified and procured adequate childcare services. Working-age women accompanied by older relatives may benefit from their potential contribution to childcare. However, the presence of dependent elderly people in the household would, on the contrary, reduce the potential labour supply of the working-age individuals.
In order to estimate the number of Ukrainian refugees who might participate in the labour market of European countries and start working by the end of 2022, several pieces of information are needed and a number of hypotheses must be made. These hypotheses are based on the available information on labour force participation of prior refugee inflows, prior migrants from Eastern Europe, and the current Ukrainian refugee inflows.
The number and distribution of Ukrainian refugees across European countries is assumed to remain fixed at the level observed at the end of April 2022 (Figure 4). The estimates therefore do not account for additional arrivals that may occur later in 2022, nor for a potential increase in returns to Ukraine.
Based on existing reports from governments or other stakeholders, it is assumed that half of the Ukrainian refugees in neighbouring EU countries (Poland, Hungary, the Slovak Republic, Romania) are aged 0‑19. In the other countries, it is assumed that the share of the 0‑19 age group is one‑third. For all countries, it is assumed that 9% of adults aged 20+ are aged 65+. In line with what is observed in the main host countries of Ukrainian refugees, the share of women among adults is assumed to be 85%.
The education distribution of adult Ukrainian refugees across all host countries is assumed to be similar to the distribution observed among Ukrainian refugees registered in Spain (Figure 2). Alternative hypotheses, such as using the distribution of education in Ukraine in 2020, do not lead to large differences in the results.
The component that is the most difficult to assess is the speed and level of labour market integration of Ukrainian refugees. As discussed above, there are many reasons to be quite optimistic about their employment prospects, at least compared to refugees arrived earlier and from farther away. However, the projection horizon, end of 2022, is less than one year after the first arrivals, and early employment outcomes of refugees are typically quite weak. Balancing these different aspects is not obvious and any prediction in this area is subject to significant uncertainty.
To keep things relatively simple, two alternative sources of information on labour market participation and employment are used. The first source is the ad hoc module of the 2014 EU Labour Force Survey Ad Hoc Module (2014 AHM LFS), which allows estimating activity and employment rates of immigrants by migration motive. The potential outcomes of Ukrainian refugees in 2022 are approximated by that of respondents to the 2014 AHM LFS who were refugees and had a duration of stay up to five years. The advantage of this data source is that it is the only one providing labour market outcomes specifically for refugees. The small sample size, however, requires to include all refugees arrived up to five years before the survey, irrespective of their region of origin and not just those with a very short duration of stay. This may limit the comparability with the recently arrived Ukrainian refugees.
The second source is 2019 EU Labour Force Survey (2019 LFS), from which the activity and employment profiles of recent immigrants (duration of stay up to two years) from non-EU European countries are estimated. In this case, the advantages and disadvantages are reversed compared to the 2014 AHM LFS: the data are more recent, and the larger sample size allows looking at a more adequate subsample in terms of region of origin and duration of stay. However, the data does not contain information on migration motive and it is therefore impossible to obtain labour market outcomes only for humanitarian migrants.
For both data sources, considering the low share of working-age men among Ukrainian refugees, it is assumed that all working-age Ukrainian refugees have the participation and employment profiles of women. These activity and employment rates, disaggregated by age group and educational attainment, are shown in Figure 5 and Figure 6.
The activity and employment rates estimated from these two different sources present some key differences. First, the overall rates estimated using the 2019 LFS are generally higher, which may reflect both the fact that they concern mostly immigrants who came for non-humanitarian motives (vs only refugees in the 2014 AHM LFS), but also the more favourable labour market conditions in recent years compared to 2014. Second, the returns to education are much higher in the 2014 survey: there is a large gap in outcomes between refugees with a tertiary education and those with secondary or less. This gap is either absent or much less pronounced in the 2019 data. Strikingly, the activity and employment rates of the best performing groups – those aged 20‑34 with a tertiary education – are virtually equal between in the two data sources (a participation rate of 60% and an employment rate of 50%).
Combining these different pieces of information and hypotheses, it is possible to calculate the number of Ukrainian refugees who are likely to enter the labour force by end‑2022, as well as the number who will likely be employed. To make comparisons easier, results are presented relative to the labour force or employment of host countries.
Results are presented in Figure 7 and Figure 8. In what follows, the numbers cited refer to the impact estimated using the activity and employment rates obtained from the 2019 LFS. Estimates using the 2014 AHM LFS are systematically smaller, with similar rankings.
In terms of labour force, for all European countries together, the estimated impact is an increase by about 0.5%, or more than 1.2 million workers. For individual countries, the largest labour force increase is found in three countries: the Czech Republic (2.2%), Poland (2.1%), Estonia (1.9%). For several other countries, the impact is estimated between 1% and 1.5% (Hungary, Latvia, the Slovak Republic, Lithuania, Romania). For all other countries, the relative change is expected to be much lower, at most 0.5% and even smaller for most of the large European countries.
Results for employment show a similar ranking of countries, with the Czech Republic, Poland and Estonia exhibiting a relative positive change of at most 1.9% while the overall impact across all host countries is estimated to be 0.4%, with most countries below that mark.
Overall, as expected considering the strong concentration of Ukrainian refugees in countries neighbouring Ukraine, most of the impact in terms of labour force and employment will be observed in a few countries. Compared to the perspective provided by absolute figures, results in relative terms show that the Czech Republic, the Slovak Republic and the Baltic countries – which have small populations compared to Germany and Poland – will experience a significant impact.
How do these results compare to the impact of previous refugee flows in Europe and elsewhere? A detailed assessment of the impact of the 2014‑17 refugee flows in Europe has shown that, for European countries as a whole, the estimated relative impact of those inflows on the working-age population was small, projected to reach no more than 0.33% by December 2020. In terms of labour force, the magnitude of the aggregate net impact was estimated to be even smaller, at less than 0.25% by December 2020 (Figure 9). This impact was expected to be significantly higher in the top four countries, Austria, Greece and Sweden, with at least a 0.5% increase in the labour force and up to 0.8% for Germany .
In the case of the 2022 Ukrainian refugees, the overall estimated impact (0.5%) is therefore about twice as large as that of the 2014‑17 inflows. The impact for individual countries is also expected to be larger than what was observed in the main host countries of 2014‑17 refugees, although the main host countries have changed. While Germany, the main destination of the 2014-2017 refugees, was estimated to experience an increase of 0.8% of its labour force as a result of those arrivals, the impact of current 2022 Ukrainian refugee inflows in the top three host countries (Czech Republic, Poland and Estonia) is estimated to be at least twice as large. (Figure 8). Indeed, eight countries are expected to see a larger impact of Ukrainian refugees than Germany saw from the 2014-2017 arrivals, even if the estimated impact for Germany is half that of the previous inflow.
As shown in , while the change in labour force induced by the 2014‑17 refugee flows was estimated to remain relatively limited even in the main destination countries, the impact was estimated to be much larger in specific segments of the labour market in these countries. Among young low-educated men, it was found that the impact could have reached about 15% in Austria and Germany. Similarly, moderate country-level impacts were also expected to be accompanied by much larger local impacts in the main cities where refugees tend to concentrate. Host countries largely anticipated this risk by implementing various types of dispersal policies for asylum seekers and refugees.
While the “average” refugee in the context 2014‑17 inflows was a relatively low-educated young man, in the case of the 2022 Ukrainian refugees, it is more likely to be a tertiary educated woman, often with accompanying children. As a result, the most affected labour market segments will be different: less manual labour, and more service-related jobs, for example, requiring higher levels of literacy as well as numeracy, or occupations allowing part-time work with fewer night and weekend shifts.
Considering the labour needs of the main host countries, a negative impact in terms of employment or wages for the resident population, driven by the 2022 Ukrainian refugees, seems very unlikely. However, the situation should be monitored closely to avoid any potential issue at the local level or in specific occupations.
The impact on the European labour force of the inflow of Ukrainians is measurable: an increase of an estimated 0.5% by the end of 2022, although impact is uneven and several countries seeing increases of as much as 1.9%. The estimated impact is about twice as large as that of the 2015‑17 inflow of refugees.
Ukrainian refugee flows comprise many women and high-educated, meaning that the most affected labour market segments will be different from those affected by prior refugee inflows, and policy responses need to take into account the skills and requirements of this new inflow.
A negative impact in terms of employment or wages for the resident population, driven by the 2022 Ukrainian refugee inflows, seems very unlikely, especially considering the acute labour needs of the most affected host countries. However, policy makers should monitor developments to identify any potential local level issues or in specific occupations.
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The term “refugee” is used in this brief to refer to persons, who are fleeing from Russia’s war against Ukraine and have obtained some sort of international protection, including not only formal refugee status (as per the Geneva Convention) but also subsidiary and temporary protection (as in the case of most refugees from Ukraine).