1 Introduction

Of the more than 27 million refugees in the world today (United Nations High Commissioner for Refugees (UNHCR), 2022), many are of working age and highly educated (UNHCR, 2019a). Yet the ability of refugees to resolve their displacement via skilled migration is limited. Prospective host countries use ‘immigration risk’ assessment mechanisms to make it harder for individuals from refugee-producing countries to obtain work, study or tourist visas (Australian Human Rights Commission, 2016), while refugees may lack sufficient evidence pertaining to their educational qualifications and relevant work experience that would-be employers can use to assess individual productivity. These hurdles contribute to a very low international transfer of refugees’ human capital and contribute to their underwhelming and long-lasting experiences of labour market outcomes and socio-economic integration (UNHCR, 2019b; Tani, 2017).

Fewer than 4% of the world’s refugees will eventually solve their displacement through planned annual resettlement programs (UNHCR, 2022),Footnote 1 a process that is (appropriately) triaged on the basis of individual protection needs rather than skills or qualifications (UNHCR, 2011, p. 37). Once resettled, refugees generally face new economic and social integration challenges, including labour market occupation-education mismatches. For instance, employers may hold unconscious biases toward refugee candidates or may be discouraged from hiring them by a belief that hiring refugees is too complicated (Szkudlarek, 2019). Common narratives about refugees being ‘needy’ and effectively a drain on welfare (Sampson, 2016) can impede entry into the labour market at a level commensurate with refugees’ actual professional abilities, and prevent their full earning realisation in their new countries.

Against this general background, through the advocacy of the non-profit organisation Talent Beyond Boundaries (TBB—see Appendix 1), the Australian government has embarked on a pilot scheme in 2018 to bridge refugee and skilled immigration pathways. Shortly afterwards, TBB championed similar pilot programs with the Canadian and UK governments. The Australian, Canadian and UK programs rely on employer-sponsorship to offer jobs in occupations affected by shortages to refugees who have been pre-screened by TBB to confirm credentials and work experience, and prepare the necessary documentation. The pre-set employment contract imposes certain restrictions on both employer and refugee but adheres to the host country’s existing legislation and visa classes—an appealing feature. As employer-sponsorship immigration is typically uncapped, these pilot programs represent an effective opening up of skilled migration pathways to individuals who are professionally qualified and experienced but fall in the ‘refugee’ category for the circumstances underpinning their migration status. Such pilots are therefore examples of a possible way to overcome the restrictions that separate refugees from economic migrants in national approaches to migration management.

To date, little research has discussed these pilot programs. We aim to address this gap by presenting some insights emerging from the 2018 Australian pilot. To set the scene, we follow a mixed-method approach: after reviewing the multidisciplinary literature that investigates refugee migration (Sect. 2), we estimate the amount of skill wastage experienced by refugees (vis-à-vis economic immigrants and natives) in Sect. 3. The estimates are obtained from data sourced from the Building a New Life in Australia (BNLA) and the Household, Income and Labour Dynamics in Australia (HILDA)–two longitudinal surveys representative of Australia’s native and immigrant population. We then provide an overview of the pilot program in Sect. 4, and the description of three case studies collected from interviewing sponsored refugees and their employers. Finally, in Sect. 5, we highlight some insights from TBB’s viewpoint, and suggested policy mechanisms that may help refugees improve their economic integration and skills utilisation.

The analysis examines the case of highly educated (hitherto referred to as ‘skilled’) refugees because they are at the core of the pilot projects. TBB chose to focus on these refugees to add resettlement opportunities to the cap set by refugee quotas. Reliance on sponsorship based on the refugee’s skills and qualifications was deliberate to accommodate employers’ needs and avoid using personal affiliations or a random selection mechanism. It also made it easier to attract employers, as skill shortages do not necessarily require high levels of proficiency in the host country language. For example, many sponsored refugees are IT specialist using programming languages that are uniformly used worldwide but do not possess uniform levels of English (i.e. for Australia and the UK) or French (for Canada). In fact, as highlighted in the concluding section, an open policy question for the adopting governments is the design of a ‘compensatory’ mechanism that does not exacerbate inequalities among refugees about who gets resettled and institutionalises a new migration pathway without openly ‘picking winners’.

2 Literature

The labour market outcomes of refugees in countries of resettlement are of interest to various disciplines.

2.1 Social Sciences

Perhaps the largest body of literature belongs to the social sciences, where the disadvantage of first-generation refugees in the labour market has been widely documented (Hebbani & Khawaja, 2018; Hugo, 2014; Kaushik et al., 2016). The main contribution of these studies is to identify the patterns of marginalisation that create barriers to meaningful employmentFootnote 2 such as limited language proficiency (Cheng et al., 2021), the lack of social networks (Ganassin & Young, 2020), and the unfamiliarity with the local bureaucracy and the culture and practices of the workplace (Kosny et al., 2017; Lee et al., 2020).

A subset of this literature focuses on the specific needs and experiences of highly skilled refugees, for whom the challenges of finding employment have a different weight compared with refugees holding primary or secondary degrees. For example, university-educated refugees face significant barriers in providing required or acceptable evidence for their qualifications and work experience, especially with respect to their professional accreditation, which may require additional study and a deep understanding of the administrative steps involved (Davey & Jones, 2020; Piętka-Nykaza, 2015; Sandoz, 2020). These barriers are often underpinned by an assumption that people educated in certain countries learn at a lower standard than what the host country see itself providing (Hebbani & Khawaja, 2018; Sandoz, 2020). If governments mandate refugees to find employment quickly after arrival, as in Australia, fast entry into employment is preferred over searching a job of adequate quality, and this results in migrants ending up in roles requiring a lower level of skills than what they actually possess and severe educational-occupational mismatches (Hebbani & Khawaja, 2018; Sandoz, 2020).

Besides the body of work that looks at the barriers to refugee employment from the perspective of employees, there is relatively little that addresses the perspectives of employers. This is a significant area of further exploration because of the repeated theme of discrimination that refugees seem to experience with job searching and their imperfect language proficiency (Kaushik et al., 2016; Kosny et al., 2017; Lee et al., 2020). Scholars note how media representations about refugees tend to fuel this discrimination (Campion, 2018; Sandoz, 2020), reflecting a bias for homophily—i.e. the similarity attraction effect (Almeida et al., 2015; Campion, 2018), meaning that refugees are less likely to be considered employable by employers who have different cultural backgrounds and professional experience.

Overall this stream of research fulfils the objective of documenting the challenges that remain once the immediate threat to life has been overcome. This reality however is mostly drawn from qualitative in-depth interviews that provide rich information on individual cases but does little in terms of supporting broader analyses and recommendations.

2.2 Economics

The economics literature is similarly concerned by the barriers that prevent refugees’ human capital to be gainfully used in the host country (Betts, 2021; Clemens et al., 2018), and the similarity of these barriers for non-refugee immigrant groups (Bansak et al., 2020; Bevelander & Pendakur, 2014; Borjas, 1994; Chiswick & Miller, 2009; Colic-Peisker & Tilbury, 2006), but aims at quantifying such disadvantage with the use of secondary data. In this respect, Australia is one of the few countries where information on type of immigrants, hence including refugees, is collected and made available for research. The BNLA—a longitudinal survey of humanitarian migrants conducted annually since 2013 (Edwards et al., 2018; Rioseco et al., 2017)–is possibly one of the best world data sources devoted to refugees.

A handful of studies has measured the disadvantage of refugees and other humanitarian entrants vis-à-vis economic and family-reunification migrants (Chiswick et al., 2005; Cobb-Clark, 2000). The two most common factors explaining refugees’ inferior labour market outcomes are human capital and language proficiency (Delaporte & Piracha, 2018). The BNLA reveals that the vast majority of refugees (> 75%) still experiences unemployment two years after settlement (Delaporte & Piracha, 2018). While this is lower than the 95% experienced just six months after arrival, it is found that better English language skills reduce the education-occupation mismatch in the labour market by less than 10% over the 2 years in which BNLA’s refugees are followed—a significant but small amount considering that refugees spent only little time as unemployed before escaping their countries of origin. Although the economic literature offers important references about the degree of skill wastage experienced by refugees, it tends to omit the factors that have successfully contributed to lower it—the core of this paper.

2.3 Legal literature

A separate literature has focused on a ‘legalistic’ angle by exploring the role that employment rights, or lack thereof, play in easing refugees’ transition into employment. For example, Speed and Kulichyova’s (2021) account of how the Council of At-Risk Academics (CARA) program operates to support the employment migration pathways of academics, note how refugees are “seldom considered strategically important by employers so forego the support traditionally provided to expatriates” (p. 5). This seems compounded by hesitance on part of employers to hire refugees. As a result, intermediaries of ‘displaced talent’ such as TBB have an important role to play in exploring feasible opportunities to bridge skilled migration pathways and policies, and “better addresses the talent development and workforce integration challenges of refugees” (Speed & Kulichyova, 2021, p. 1). As such, these organisations are ideally placed to facilitate employment migration at the macro (international political, economic), meso (settlement country, sector, program) and micro (individual) levels. This intermediary function is precisely what TBB has put in practice with success in Australia, Canada, and the UK.

3 Skills Wastage Among Refugees: How Large is it?

To frame the context surrounding Australia’s 2018 decision to undertake TBB’s pilot project, we estimated the extent of a summary measure of skill wastage—over-education—among refugees with respect to non-refugee migrants and non-migrant (‘natives’), respectively. Over-education is an indicator of the gap between the education acquired by an individual through investment in schooling and the amount of education required to perform the job one is carrying out (Leuven & Oosterberk, 2011; Piracha & Vadean, 2013).

Typically, an individual is considered over-educated if s/he has a level of education above what required by the job performed, such as when a university graduate works in a job that only requires high school or lower levels of education. While over-education is common when one enters the labour market to gain work experience, prolonged ‘stationing’ in a job that requires a lower education level impedes the ability to achieve one’s full potential. In other words, an under-utilised individual in the labour market possesses an education ‘excess’ that may generate positive returns at the individual level (e.g. slightly higher wage or better chances for promotion relative to not having that excess education). However, as education is typically funded with public resources that could be used for other purposes, the presence of over-education is a symptom of wastage for the individual experiencing it (because of unused potential), and the societies of the places of origin (which funded the acquired education) and destination (which under-uses the migrant’s skills and earning potential).

The empirical analysis draws relevant information on refugees from the BNLAFootnote 3 and HILDA, which contains information on natives as well as refugee and non-refugee migrants.Footnote 4 Table 1 summarises the unconditional mean of demographic and labour market characteristics of the working sample from both databases, as well as the probability of over-education (BNLA: before and after settlement in Australia; HILDA: relative to natives), conditional on being in employment.

Table 1 Key summary statistics and results
Full size table

The estimates are obtained from the linear regression probability model:

$$ y_{it} = \beta_{0} + \tilde{X}_{it} \beta_{1} + \beta_{2} Z_{it} + t + u_{i} + \tau_{it} $$
(1)

where \({y}_{it}\) is a measure of the over-education of individual i working at time t (note that unemployment could be used as an outcome); \({\widetilde{X}}_{it}\) is a set of demographic and labor market characteristics (e.g. age, age square, gender, marriage, education, general health, mental health, industry, location…); \({Z}_{it}\) is a dummy variable indicating the immigrant status of the respondent (locals are the baseline); t measures the effects of time, and \({u}_{i}\) and \({\tau }_{it}\) form a composite error term.

The parameter of interest in model (1) is \({\beta }_{2}\), as that captures the effect of immigrant status on the skills match conditional on demographic, educational, and employment characteristics.

Table 1 shows the stark drop in the quality of the occupation-education mismatch for refugees upon settling in Australia relative to non-refugee immigrants and natives with similar demographics.

As the statistical model (1) uses refugees pre-migration occupation as a reference, the estimates clearly illustrate the difference in over-education between the current and last job performed before resettlement: a drop of about 1 level of education (pooled result), which is driven by women’s worse labour market outcomes.

Refugee women are the group with the largest decline in the quality of their occupation-education match, implying that their human capital investment in the country of origin is largely lost as a result of resettlement. The case of males is less severe but the coefficients are large and statistically significantly different from zero.

Time seems to have very little effect on refugees’ poor job match quality relative to their last occupation prior to leaving their country of origin: the over-education penalty experienced at arrival in Australia is little different from that experienced after 10 years living there. Interestingly, the penalty for women is halved over a decade, while that of men, for whom it is not as severe initially, is marginally higher. Women therefore seem to experience a ‘catch up’, though this is insufficient to close the gap with their education-occupation match prior to settling in Australia.

Data from HILDA depict a less severe situation than what is portrayed by the BNLA: refugees have a higher probability of over-education than natives but so do non-refugee (i.e. economic and family reunification) migrants. The estimates by gender show mixed patterns. In the case of refugees, the gap with natives is statistically zero when the estimation is carried out separately by gender but it is instead zero when data are pooled across genders. In the case of non-refugee migrants, the gap clearly emerges when the analysis is carried out separately by gender but the disadvantage relative to natives disappears when data across gender are pooled together. Refugees surveyed in HILDA seem therefore to be much better off than those surveyed by the BNLA. These apparent inconsistencies may be explained the fact that the refugees covered by HILDA have been in Australia for over 20 years. As a result, they may have had sufficient time to learn and adapt to the dynamics of Australia’s labour market and have ‘assimilated’ to a greater degree than those surveyed by the BNLA.

More consistent results instead emerge in the case of severe over-education–that is where the excess education is two or more levels. Refugees experience slightly higher levels of over-education than non-refugee immigrants and natives, respectively, and this effect is overwhelmingly attributed to males. Female refugees seem to better integrate into Australia’s labour market, notwithstanding the fact that only 30% of them work relative to 53% among non-refugee female immigrants, and 59.6% among native females. The picture from HILDA, which is based on its relatively small number of refugees, is that the penalty associated with refugee status is indeed comparable in magnitude with that experienced by non-refugee immigrants. Female refugees also seem to fare better than their male counterparts–an indication also emerged from the results obtained from the BNLA.

Overall, Australian secondary data suggest that refugees experience the worst labour market outcomes and largest skills wastage. Reducing or eliminating such wastage is a relevant policy objective, as better economic integration can at once reduce economic dependence and generate extra public resources through refugees’ higher income from more or better work. Of course the economic motive is only part of the benefits that better socio-economic refugees’ integration can deliver to them personally—for instance better health and well-being—and to the other stakeholders affected by refugee migration (e.g. less inequality and disadvantage in the society), as highlighted below.

4 Cases

4.1 Background

TBB tracks candidate job opportunities and education levels of resettled candidates through their database. In early 2020, 16 primary applicants from the 2018 pilot participated in TBB’s ‘alumni survey’. Successful matches in the piloting phase reflect distinct skill preferences in Australia’s immigration policy, as they overwhelmingly include highly educated professionals. 13 had a university or postgraduate education while the remaining 2 completed an associate degree.

Refugees’ employers in Australia tend to operate in services, are medium and large corporations with 250 + employees, and entered into the pilot to access skills and do so at a cost that was similar or lower than the cost of hiring a migrant admitted through the standard immigration process. Only one employer, out of the 18 interviewed, reported higher hiring costs than what experienced when hiring a comparable native or skilled migrant worker. Out of 15 employers, 8 hired candidates at their skill level with ‘full competency for the job’, 4 hired candidates below their skill level on a ‘pathway’ to the higher skill level, and 3 hired candidates below their skill level (Talent Beyond Boundaries, 2020 pp. 23–24).

In what follows, we offer examples from three industries—Construction, Healthcare and Financial/Professional Services—as reflections on the experiences and outcomes of employers’ involvement with refugee skilled migration. It is important to note that that TBB promotes a competitive recruitment process, asking employers only to hire when they find a candidate who they think is suitable for competitive roles that cannot be sourced locally, this is a substantial hurdle for workers in tech and financial/professional services. It is also noteworthy that the cases presented were breakthrough experiences from the pilot program, offering some fundamental insights about what worked and what did not.

4.2 Case 1 (Construction)

The sample included two employers from the construction industry, which had both recruited a placement through TBB. In line with the trend towards refugees being employed in professional positions, both employers hired candidates into engineering roles. Both reported that these candidates were hired at their skill level and with full competence for the job. One employer representative reported that the two shortlisted candidates made such a good impression that both were offered a job. The representative added that it made “good sense” to identify refugees who are highly skilled and experienced in professions that are in high demand in Australia at a time when the country is in a period of “peak construction activity”–but also noted that their personal passion for hiring refugees was a motivating factor.

While the employers were pleased with the successful candidates and were either likely or extremely likely to continue the program, they did outline the need to apply flexibility and more clarity on any additional financial and other costs when recruiting refugee candidates. For example, one said it took so long for the candidate to receive his visa that the role, which the candidate successfully applied for, had to be given to someone else. However, the company was able to identify a new position for the candidate when a visa was eventually granted. This participant also noted that the process required additional legal and corporate approvals because “the process sits outside our usual international recruitment approvals”.

4.3 Case 2 (Healthcare)

The sample included six employers in health care: three in Australia and three in Canada. Employers were seeking nurses and patient support workers. Only two had recruited candidates at the time of the survey—one currently working with the employer and another who was in the process of securing a visa. The recruited candidate who commenced working in their role was reportedly hired below their skill level as a continuing care assistant (i.e., junior/unregistered nursing role). The employer representative noted the candidates for the role were nurses in their country of origin; however, they are not able to practice nursing until they sit an exam to meet licensing requirements. Another employer representative was concerned that the candidates put forward by TBB wouldn’t be satisfied working in the available roles because their skills were “too high”. However, it was not possible to hire them at their skill level because their skills were developed in a different setting (i.e., hospital nursing rather than community or home care nursing).

Employer representatives pointed to several challenges that may act as a barrier to the recruitment of candidates from refugee backgrounds. One, whose company was yet to hire a candidate, pointed out the longer timeframes involved were a difficulty that may impede the recruitment of refugee candidates abroad because there is an emphasis on filling vacancies as quickly as possible. Likewise, the company representative indicated that waiting for their selected candidate’s visa to be processed made recruitment “resource-heavy” and “expensive” because it required applying for a Labour Market Impact Assessment (LMIA). The company representative pointed to a culture of prioritising timely recruitment and indicated it would take “someone with a passion for refugee work” to convince the organisation that recruiting a refugee candidate was worth the extra effort involved. A lack of access to employer references was also highlighted as problematic.

4.4 Case 3 (Financial/Professional services)

The sample included five Australian employers in Financial/Professional Services (FPS). Employers were seeking candidates for roles in IT, legal services, audit, administration, and management. Two candidates were hired at their skill level and a further two were hired below their skill level—either due to licencing/registration requirements (in the case of a lawyer) or due to a lack of prior experience in the exact role they were hired to perform (in the case of an executive assistant).

Several FPS employers noted that the immigration process was a particularly challenging aspect of the recruitment process that created challenges internally. In one case the selected candidate had been delayed because they did not have a passport—“due to being stateless”. Another employer noted that the candidate’s onboarding had to be delayed until the following financial year “due to visa hold-ups”. A third employer representative, whose company was yet to hire a candidate through TBB, noted that the delays associated with the immigration process could make it difficult to advocate internally for a refugee candidate. This was because it involved asking managers to consider putting a project on hold to wait for a new hire to start, “especially when there is a delivery timeline to be met”.

5 Remarks

Based on TBB’s reflections, collected through direct communication with its representatives in Australia, a number of lessons were learnt from the 2018 Pilot. First and foremost is that employers could recognise the value of the initiative and were willing to invest in recruiting from the talent pool of displaced refugees. Key business factors driving participation in the scheme were the speed of the process and consistent visa processing times and relatively accessible cost. Small and medium-size employers in particular raised that visa fees and settlement costs are important negative attributes of accessing skilled refugees and skilled migrants more generally. Employers also pointed out that offering a job, and facilitate and pay for relocation were not impossible problems to the success of the pilot, but the complexity of the application process can be the final deterrent: employers typically do not want to get involved in complex settlement planning arrangements for family members. As a result, TBB’s mediation was instrumental to overcome this hurdle.

Another important lesson learnt regarded addressing displacement-related barriers. For instance, during the 2018 pilot most candidates could not apply for skilled visas due to administrative requirements related to their displaced status. It was, and remains, important to codify flexibility arrangements so that alternative arrangements for candidates without passports can be found, as well as alternative skills validation techniques and concessions for English language skills.

With reference to professional licensing, candidates in occupations requiring professional registration and licensing (eg. healthcare) seemed particularly disadvantaged as most Australian professional bodies responsible for licensing do not offer testing facilities in common first counties of asylum. For suitable candidates in those circumstances, the most streamlined approach was to be hired at a lower level of skill (eg. nurses hired initially as personal carers) and then complete professional licensing upon resettlement. Employers shared their willingness to support this approach if the visa systems made it possible.

Importantly, employers and TBB singled out the fundamental role played by brokering settlement services. While TBB candidates arrived in Australia as skilled migrants, they are nevertheless displaced persons who may face a range of complex issues relating to their experience and personal circumstances. Ensuring a sustainable model to support settlement and integration is not only relevant but also a requirement hardly serviced by market forces alone. In the case of Australia there is already an effective network of organisations and groups that carry out such support services but they need resourcing and better coordination. Employers are willing to make a contribution to settlement costs but the government also has a coordination role to play besides financial support to help coordinate business and community support arrangements for incoming displaced refugees.

At the international level, labour mobility schemes are of increasing relevance and interest to states, civil society, and UNHCR.Footnote 5 Some scholars have argued that the potential expansion of labour mobility faces a fundamental challenge because high-income countries prefer to administer the entry of refugees and migrant workers separately (Martin & Ruhs, 2019; Ruhs, 2019) and will offer ‘carefully controlled’ versions of labour mobility (Crisp, 2020). However, these arguments rely on a traditional view of government as the driver of refugee admission with only partial, if any, input from employers, which in turn may generate costly mismatches between refugee types and host country opportunities.

The TBB pilot has shown both employer and government interest in an employer-led model of refugee skilled immigration. In the current era of record levels of forced migration (UNHCR, 2022), visa programs established for skilled migration represent a largely untapped area of potential through which refugees may access safe and permanent solutions to their displacement. Refugees have the skills and qualifications to fill global skill gaps and, if given the opportunity, could travel on skilled visas, accompanied by their family members, to rebuild their lives. Skilled visa programs have traditionally unintentionally but systematically excluded refugees through their administrative requirements, which are uniquely difficult for displaced people to satisfy. However, TBB’s 2018 pilot shows the potential for governments to contribute solutions for refugees stuck in displacement contexts.

6 Implications for Policy

Initiatives such as TBB’s 2018 and subsequent pilots illustrate the possibility of ‘recovering’ the skills that refugees gained in their home countries to supply them to host country employers. Faced with a ballooning number of refugees over the past two decades, and the ensuing skills wastage, uncapped visa programs established for skilled migration represent a new area of potential pathways through which refugees may access safe and long-term solutions to their displacement. At the same time, notwithstanding their success as pilot programs and their potential for scaling up, it is unlikely that using skilled migration visas can be ‘the’ solution to alleviate the raising number of refugees (both highly and less highly educated) around the globe. Enabling highly educated refugees to access employer-sponsored migration visa is hardly unrelated to the design of ‘compensation’ mechanisms to ease the trauma experienced by less educated refugees. The latter are neither less deserving to access opportunities to relocate away from refugee camps nor less capable to generate net economic benefits, as many successful immigrant entrepreneurs do not hold university degrees. Expanding an employer-sponsored refugee programme ought not to produce sub-classes of more and less desirable refugees resulting in worse odds for those left behind in camps to find a sponsor. While is no easy solution to substantially reduce the number of refugees and the enormous loss of skills that is associated with it seems to exist at the moment, pilots such as those undertaken by the Australian, Canadian and British government deserve close attention as they may reveal fundamental determinants to unlock refugees’ potential as a social and economic resource.