THE IMPACT OF SYRIAN CONFLICT AND THE REFUGEE CRISIS ON LABOUR MARKET OUTCOMES OF HOST COUNTRIES

Abstract

The civil war in Syria, which started in March of 2011, has led to a massive influx of forced migration, especially from Northern Syria to the neighbouring countries. The unexpected movement of refugees has created large exogenous labour supply shocks with potentially significant effects on the labour and living standard outcomes of natives in the host countries. Using a difference-in-differences (DID) framework, this study explores the impact of Syrian refugees on labour market outcomes in Jordan and Turkey. Furthermore, we implement an instrumental variables (IV) approach within the DID framework. The results are mixed and vary, not only across the labour outcomes explored but also across demographic and socio-economic groups, as females and low educated are mainly affected by the refugee crisis negatively. Main policy implications include the design and implementation of active labour market policies, necessary measures to address the employment in the formal sector, encouraging the private sector to employ Syrian refugees in sectors where migrant workers would like to work and natives are not willing to work. Other policies include the implementation of realistic scenarios to integrate the refugees in the domestic labour market that will be beneficial for the domestic economy. Furthermore, national governments and authorities should maximize the job creation potential by collaborating with international actors. School enrollment for refugees' children and granting formal work permits to their parents are other policies that may affect natives and refugees positively.