Engaging the Private Sector in the Refugee Crises: Evidence from Uganda

Recent conflicts and sectarian violence have produced the highest number of refugees ever recorded in the world. Currently more than 25 million refugees have been forced to flee their homes. The majority of these people are hosted by developing countries. For these reasons, the efforts of the UNHCR and other partners are moving towards a new approach in refugee management: from the prevalent emergency perspective to a development one. Recent studies show how granting access to formal labour markets produce positive long-term effects for host countries. Yet, refugees, especially in developing countries, may find it particularly hard to access local job markets. This may be especially true in sub-Saharan Africa, home to a quarter of all forcibly displaced people. This project sets up a novel RCT to find out how to overcome barriers to economic integration of forced migrants in these countries.

In a pilot study, the researchers identified frictions that limit labour market opportunities for refugees: uncertainty regarding refugees’ legal status; no referral network; lack of documentation to attest level of education or experience; inaccurate beliefs regarding refugees’ productivity; and prejudice. Through an RCT, this project will test mechanisms to alleviate these frictions. 800 firms with at least one vacancy will be recruited and divided into four with a control and three treatment groups: 1) provision of information regarding the law and employment of refugees; 2) in addition to treatment 1, firms will receive a “guarantor-referral” that could be used in case of any issues during the refugee's employment; and 3) in addition to treatments 1 and 2, firms will be informed of the average productivity of refugees on a simple data-entry task relative to locals. All firms in each group will receive three (real) job applications, two from refugees and one from a local, all who have been recruited as part of this RCT. Interview and hiring rates will be compared across the four groups to determine mechanisms hindering refugees' economic integration.

Given the scale of forced displacement in lower-income countries, and with the possibility that this will increase in the future, there is significant interest in initiatives focused on refugee integration that are effective and inexpensive. This project thus has an important policy relevance in that it can provide governments with evidence-based advice on how to ease frictions for refugees in accessing labour markets. The research team has already started collaborations with local and international institutions and policymakers, such as the government of Uganda and the UNHCR, to capitalise on this interest.


Francesco Loiacono

European Bank for Reconstruction and Development (EBRD)

Mariajose Silva-Vargas

Maastricht University