Job Search Strategies and Labour Market Outcomes of Young Recent Migrants from Central & Eastern Europe in EU15 Member States

Abstract

This paper examines the use of social networks and its impact on the qualitative labour market integration of young recent EU migrants from Central and Eastern European member states to EU15 countries as well as Switzerland and Norway. The literature points to both positive and negative impacts of social networks on migrant workers’ outcomes. Social networks can facilitate access to employers and information on labour regulation and rights and thereby improve the quantitative and qualitative labour market outcomes of migrant workers. On the other hand, social networks can also contribute to locking migrant workers into sectors and occupations with high shares of migrant workers, so-called niche employment. The latter can lead to suboptimal working conditions including a mismatch of skills and occupation (over-qualification) and lower wages. The impact might be particularly negative for recent migrants from Central and Eastern Europe as previous research on EU cross border labour mobility has shown that they are comparatively high qualified and young. The latter might put them at a double disadvantage given that youth have particular problems in entering (quality) employment as they lack work experience which they could use to signal to employers directly and might therefor have to rely more on social networks of established migrant communities. In contrast to the majority of current research on migrant outcomes and social networks which is based on qualitative research this paper makes use of the 2014 special module on migrants and their descendants of the European Labour Force Survey (EU-LFS). The advantage of the special module is that it includes a subjective measure on over-qualification, one variable of our main interest. Given the existence of migrant employment niches, the standard measures on over-qualification are problematic in that they are usually based on occupational information. Importantly, the special module also contains information on how they found their current job including the use of social networks (relatives, friends or acquaintances), another variable of our main interest. Furthermore, beyond the standard demographics and employment characteristics the data also includes information on language competences and other hurdles preventing a person to have a job corresponding with their qualifications including a lack of recognition of qualifications obtained abroad and discrimination by origin, religion or social background. These are factors are likely to be important regarding the impact of social network support in finding employment on the respective qualitative employment outcomes. Due to data restrictions we have to compile all the post-2004 accession country migrants into one group (EU13). We do however control for different welfare regimes on the country of destination side given that quantitative and qualitative labour market integration differs substantively across welfare regimes. This is due to variation in the economic situation, labour regulation and institutional settings and language and cultural proximity among others which in turn might impact on the importance and role of social networks in labour market outcomes. Our analysis shows that in all European country clusters recent NMS13 migrants more often found their current job through social networks than nationals did. At the same time our findings indicate that when recent NMS13 migrants found their jobs through social networks it is more likely that they are over-qualified for the position and that they fall in a lower earnings class as compared to recent migrants who used other job search methods. In particular, young recent migrants are affected rather often by over-qualification and most of them have rather low earnings. Thus using established social networks for job search might go hand in hand with sub-optimal qualitative employment outcomes. Immigrant occupational and sectoral segmentation might partially explain this outcome. However, the results differ between different welfare regimes and across individual and job characteristics of the NMS13 migrants.