The Labor Market Impact of Forced Displacement Jobs in Host Communities in Colombia, Ethiopia, Jordan, and Uganda

When refugees arrive, host communities often worry what will happen to their jobs. To help inform effective policy, this study looks at four economies with different income levels and policies toward welcoming refugees: Colombia, Ethiopia, Jordan, and Uganda. By using data and methods allowing for cross-country comparison, this study complements the existing body of literature on refugees and host communities. Using harmonized statistical methods, the study shows that, in a context of aid and government investment, the overall labor market effects of hosting refugees are modest or even positive across the four economies. Yet some host country workers can be adversely affected while others enjoy new opportunities. An assessment of work permit rules shows that changing policies shift these patterns of opportunity and competition. For refugees, better access has large positive impacts. More access for refugees does not always mean more competition for hosts, though new data shows that hosts’ worries of labor market competition are a driving force in negative views of refugees. Finally, the study uses data to show how refugees and hosts interact in the labor market. It explains how the limited choices of refugees shape their working lives and their roles as customers in local markets, while also creating patterns of competition and business opportunities for hosts. Access to capital is a central issue for refugees and hosts alike in low-income economies where self-employment is key. Policymakers should look to address the concerns of host workers who face losses, but equally, to help host communities and refugees seize important new opportunities.