16 November 2020

Give Me Your Tired and Your Poor: Impact of a Large-Scale Amnesty Program for Undocumented Refugees

Large-scale amnesty programs are a politically sensitive issue, as countries make it difficult for refugees to gain access to the labor market through regulation. The data analysis conducted here encourages governments to facilitate refugees’ path into the formal labor market. In the case of Colombia, this integration had no or negligible effects on the local workforce.

Key Issue

In early August of 2018, outgoing President Juan Manuel Santos of Colombia signed a decree to provide amnesty to nearly 500,000 undocumented Venezuelan immigrants and refugees, giving them a regular migratory status that allowed them to stay in the country, access public services such as health and education, and take up formal work. This study explores the impact of this new visa for undocumented immigrants, known as Permiso Especial de Permanencia (PEP), on the Colombian labor markets.

Approach and Methodology

Relying on confidential administrative data on individuals who received the PEP visa linked to household surveys data for each department of Colombia, we examine the impacts of the issuance of the PEP on workers in both the informal and formal sectors. Our main finding is that we do not find any large or significant effects of the PEP program on any of the outcomes that we study, except in the case of formal employment. Particularly, we observe that a twofold increase in new PEP holders (per 100,000 inhabitants) results in a drop in formal employment of 0.1 percentage points for natives. Yet, according to our calculations, this corresponds to a negligible effect in terms of its economic significance. We further find that these effects are predominantly concentrated on the employment rates of workers who are highly educated (e.g., having at least a high-school certificate) and of female workers.

Key Findings and Conclusions

Large-scale amnesty programs represent a politically sensitive issue. Some countries prefer a piecemeal approach or ban working rights altogether to prevent labor conditions from deteriorating within the host population. Imposing strict regulations for accessing formal labor markets may push migrants to work in informal labor markets, which affects the most vulnerable workers. These decisions are not based on evidence and mostly reflect the fears and prejudices of the government and the population. Our study can offer systematic lessons for developing countries that lack comparable data or opportunities for identification but are also hosting large numbers of forced migrants and may be considering implementing similar policies.