New MPI-IOM Report Offers a Preliminary Assessment of the Role of Regularization Programs in Venezuelans’ Labor Market Integration

WASHINGTON, DC — ­­For a range of economic, social and security-related reasons, governments in Latin America and the Caribbean have opted to regularize a significant share of the estimated 6.5 million Venezuelans living in their countries. Registration and regularization programs have allowed Venezuelan migrants and refugees to access basic services and formal labor market opportunities, as well as promoted their long-term integration and socioeconomic inclusion. Yet despite these efforts, many Venezuelans still lack a regular immigration status, pushing them into often vulnerable living conditions and shutting them out of services and the formal labor market.

With many Venezuelans intending to remain permanently in their new countries of residence, there is a growing recognition that governments will need to critically assess their institutions and policies for fostering effective integration. An important first step is understanding how registration and regularization mechanisms have affected Venezuelans’ economic integration to date—a significant challenge given the wide range of factors that influence integration and uneven data collection across the region.

A new study from the Migration Policy Institute (MPI) and International Organization for Migration (IOM) seeks to provide a preliminary assessment of the effects of regularization policies on labor integration outcomes. It finds, among other things, that the economic benefits linked to regularization tend to be stronger in receiving countries where migration and labor regulations are enforced in practice. It also finds that the short-term nature of many regularization mechanisms has likely limited their labor market benefits, with many employers and migrants lacking incentives to formalize job entry given the fact that recipients can quickly fall back into irregular status.

Drawing on interviews and focus groups with policy and regional experts, migrants, integration-focused organizations and private-sector stakeholders, the study explores the impacts of granting short- versus long-term regular status, varying rates of labor market informality and labor enforcement, and the significant human capital Venezuelans have brought to many countries.

The report closely examines the case of Colombia, which has received the most displaced Venezuelans and operated the region’s largest regularization program, granting a 10-year status to 2.4 million of the estimated 2.9 million Venezuelans in the country. It also looks at the dozen other countries that make up the Quito Process, which has established Venezuelans’ socioeconomic integration as a top priority. Quito Process countries are meeting in Santiago through today for a workshop that includes discussion of longer-term integration matters.

The analysts’ comprehensive mapping suggests several factors have been critical to how regularization mechanisms are shaping migrants’ labor market opportunities, including:

• Temporary versus permanent regular status. The most generous regularization mechanisms have granted Venezuelans a pathway to permanent residence, in addition to permission to work and access public services. Temporary regularization mechanisms, by contrast, entail a greater degree of uncertainty for both Venezuelan workers and employers who may be wary of hiring someone who may not remain in the country or legally employable for long.
• Venezuelans’ relatively high levels of human capital. Venezuelans, especially those who arrived in earlier periods, tend to have high levels of education. Their skills represent a significant human capital asset that could contribute to receiving-country economic and development goals if they can access jobs in their fields and career-building opportunities. To date, migrants’ salaries are generally lower than those of the native population. After regularization, however, there is some evidence of an increased differentiation among Venezuelan workers, with a stronger correlation between human capital characteristics and income level.
• The existence and enforcement of labor regulations. In some cases, complex labor laws that make it more costly to formally hire workers may disincentivize employers and migrants (even if they have regular status) from moving toward a formal employment arrangement. The manner in which labor regulations and rules against hiring irregular migrants are (or are not) enforced also plays a role in whether regularization leads to formal work, and to migrants fulfilling related obligations such as paying taxes and contributing to social security systems.

The report offers recommendations that could help governments follow through on their commitments to maximize the Venezuelan population’s economic contributions and reduce its socioeconomic vulnerability, including:

• Reinforcing the links between regularization and employment. Most regularization programs offer status that is explicitly temporary, lasting for a year or two. Creating permits with a longer duration (and that allow migrants to work, where that is not already the case) and a pathway to permanent residence could form the foundation for a longer-term strategy focused on how regularization can support both migrant integration and host-country development goals.
• Increasing dialogue between government and the private sector. Private-sector actors play an important role in migrants’ labor market integration, but their involvement in integration policy conversations is often limited. Governments could seek to engage them more fully, as well as raise awareness of rules around hiring migrants and workers’ rights.
• Supporting Venezuelan migrants’ economic mobility. Despite relatively high levels of human capital, many Venezuelans have been unable to apply their skills. Opportunities to streamline systems to recognize credentials earned abroad or to refresh or develop skills could help more newcomers find work in their fields and potentially help close the native-migrant earnings gap.

“As Latin American and Caribbean countries move away from short-term emergency responses and look to long-term integration, there are real opportunities to link regularization mechanisms with efforts to meet labor demands,” write analysts Diego Chaves-González and Natalia Delgado. “These policy tools can help countries design regularization programs that reflect evolving migration trends, connect these with tangible economic benefits for migrants and the communities in which they live and support broader strategies to address complex development challenges in the region.”

Read the report, A Winding Path to Integration: Venezuelan Migrants’ Regularization and Labor Market Prospects, here: www.migrationpolicy.org/research/venezuelan-regularization-labor-market.

For more from MPI’s Latin America and Caribbean Initiative, visit: www.migrationpolicy.org/programs/latin-america-caribbean-initiative.