How to help immigrants feel more at home and contribute more to the local economy

Imagine Ania, a Ukrainian immigrant who arrived in Berlin, Germany, in the spring of 2022 with her teenage son. Currently, the 2001 temporary protection directive gives them the assurance that they can stay for a year. If Ania ends up staying longer, however, her career and economic success will depend on the choices she had to make in that first year – choices based on how long she stayed.

When the chances of staying in a host country are uncertain, why spend time and money learning the language? Why integrate? Why start building a new life? Will Ania insist so vigorously that her son complete his homework in a foreign language and school system when she is unsure how long he will be in the EU?

If Ania and her son stay, however, the effects of decisions made in the very first months and years after their arrival could reverberate for decades. Ania may have been a certified architect in Ukraine, but to be recognized and work as an architect in her host country will require additional qualifications. She may choose to take a lower-paying job instead of investing in additional training if there is uncertainty about the length of her stay.

Being able to provide certainty about the option to settle is often an important factor for refugees and other migrants when it comes to settling and thriving in a new country for the long term. Immigration policy must reflect this need for certainty.

Beyond a one-year license

EU leaders triggered the Temporary Protection Directive for the first time this year, following the Russian invasion of Ukraine on February 24. It provides for a one-year unbureaucratic permit for refugees arriving in EU countries. It is designed as a way for Member States to react quickly to large-scale crises, avoiding a collapse of ordinary asylum systems.

But many of the refugees who have since arrived in the EU may well have to stay longer than a year. Although the directive may be extended, the prospect of longer-term settlement remains uncertain for these refugees. This can have profound consequences for both immigrants and their new country.

My recent research with Jerome Adda of Bocconi University and Christian Dustmann of University College London shows that giving migrants certainty about staying at an earlier stage could improve their integration, shape their contributions economic and ultimately cement their acceptance in host societies. We used data on Turkish immigrants in Germany, where a large-scale survey collected information for decades on immigrants’ intended length of stay. Many of the migrants interviewed for this survey arrived in Germany under guest worker agreements with southern European countries in the 1960s and 1970s.

Immigrants who expected to stay in Germany permanently integrated faster, acquired new language skills faster, and experienced greater economic progress. In particular, we found that short, temporary permits with an uncertain chance of extension make people behave quite differently from those expecting to stay permanently. The latter spend more of their income locally and have more incentives to integrate, learn the local language and acquire other country-specific skills that increase their chances of employment. This promotes career progression, productivity and income in the host country. Individual choices will therefore have macroeconomic implications in terms of the tax contribution of immigrants to the tax budget of their host country. Understanding this type of behavior is important for designing optimal migration and naturalization policies.

Return intentions

Long-term migrants are often more demanding about the type of job they are willing to accept. And, while contributing more through income tax, they are also likely to use public services and health care longer, particularly as they age and their contributions to these services decline. Long-term migrants are also often joined by their families. This increases demand for the host country’s education system, but also promotes greater integration.

For many migrants who intend to return to their country of origin, it is more common to send money home to family rather than spending it locally. And, knowing that their stay in a host country is limited, they may decide to forgo host country-specific investments in areas such as language learning and new skills to meet local economic needs, which can be expensive.

Governments often delay making a decision on whether to grant permanent migrant status for several years, based on employment, income or other goals such as language learning. Our research shows that this not only affects the number and types of people who choose to migrate to a certain country, but also their career profiles and long-term contributions to their new country of origin. The idea that long-term certainty encourages integration and supports economic contributions applies to migrants in many contexts, including that of economic migrants and political refugees, as well as documented and undocumented immigrants.

A queue of people boarding a train with Ukrainian flags.
Ukrainian refugees at a train station in Warsaw, Poland, February 28, 2022.
Great Warszawski/Shutterstock

New refugees to the EU from Ukraine, initially granted one year of protection, have limited incentive to invest in local skills. This certainly includes the language of the host country, but it also extends to the acquisition of qualifications and certifications which have limited value in the country of origin, but which are valuable for the host country.

Clear legal procedures that inform immigrants at an early stage of their prospects for staying in their host country are crucial for decision-making and could greatly affect the lives of these people. It will also have an impact on the costs and benefits for the countries where they work, consume and receive aid or pay taxes. If immigration policy takes this into account, it could do a lot to help immigrants like Ania and her son feel more at home, while strengthening their economic contribution to their host country.

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