Refugees in Australia find it harder to get decent jobs that other migrants, new research indicates.

And the main reason is employer discrimination rather than a lack of skills or language proficiency, the research by the University of NSW says.

Lead researcher and economics lecturer Dr Liwen Guo said that humanitarian migrants in Australia remain significantly less likely to be employed than non-humanitarian migrants, even after five years of resettlement.

This is largely due to employer discrimination rather than any shortfall in skills or language, she said.

The study, published in the British Journal of Industrial Relations, showed differences in education and language may explain some of the employment disadvantage faced by refugees in Australia, but the main factor is discrimination by employers because to how they screen candidates when they lack reliable information about overseas qualifications or experience.

“Although relying on visible traits like race, age, or appearance may conflict with Australia’s anti-discrimination laws, this kind of behaviour is usually subtle and informal. Employers do not say openly that they are rejecting someone because of their background; instead, when they are unsure how to judge overseas qualifications or experience, they fall back on ‘gut feeling’ and visible cues,” Dr Guo said.

“Because there is no explicit statement or clear evidence of unequal treatment, it is treated as implicit rather than overt discrimination, and often falls below the threshold for legal action, but it still means that qualified refugees are unfairly screened out and their skills are discounted,” she said.

The study combined data from two longitudinal studies, the ‘Building a ‘New Life in Australia’ (BNLA) survey and the ‘Household, Income and Labour Dynamics’ (HILDA) study, to produce the study.

They analysed responses from 2155 humanitarian migrants aged 17-60 and 1602 non-refugee migrants of the same age range who arrived in Australia between 2013 and 2017.

The study revealed refugees were about 88 percentage points less likely to be employed than non-humanitarian migrants upon arrival, and even five years later, they remained over 51 percentage points less likely to have a job, highlighting a persistent and substantial employment gap.

“We found a persistent gap that is not fully explained by differences in education, English, or other observed characteristics like gender and age,” Dr Guo said.

“Refugees earn a lower return for the skills they have, meaning that they receive a lower payoff for the same degree or Australian training than other non-humanitarian migrants who arrived in Australia at the same time,” she said.

Dr Guo said that the persistent “discount” in how employers value refugees’ skills channels many refugees into precarious work environments.

“This steers many refugees into long-term unstable or lower-paid roles, slowing not only their wage and career growth over time but also producing less tax revenue for Australia at large,” she said.

Dr Guo said there was a double effect of refugee employment discrimination.

“It harms people by adding to the challenges they face, and it sets the nation back economically. Individuals face slower earnings growth and weaker attachment to stable work. The economy loses productivity, tax revenue, and innovation that diverse teams generate,” Dr she said.

And poor employment outcomes also have implications for mental health and wellbeing, as long-term job seekers experience limited access to secure income, training, and social support.

“When qualifications are recognised and matched to roles, firms expand their effective talent pool and public returns to settlement investment rise through higher taxable income and faster integration. If you consider a 60 per cent penalty on an average salary over a working life of 30 or 35 years, that is a lot of money,” Dr Guo said.

“The loss to Australia is the lower income tax collected on that salary, and ensuing lower consumption and savings of migrants relative to what they could do if their earning gap was smaller.

“Multiply this for the thousands who resettle in Australia, and this is a pretty large loss to the country,” she said.

To address the problem, the researchers recommend building more inclusive job pathways for refugees, saying it isn’t just the mortal thing to do, it will also deliver an economic dividend, helping to create a stronger, more inclusive, and more productive economy and society.

The say businesses in Australia can play a major role in breaking down these barriers by actively employing refugees and creating inclusive hiring pathways that recognise different cultural backgrounds and levels of English proficiency.

“Reducing uncertainty can definitely help here, but so can leadership from businesses and industry bodies willing to challenge outdated hiring filters,’ Dr Guo said.

“Two possible interventions seem to provide relevant benefits here. First, to normalise the use of employer-sponsored refugee pathways with fast-track credential recognition, provisional licensing, and supervised practice designed for the industry.”

Another recommendation focused on how businesses approach the job search and hiring refugees, with a need to de-emphasise ‘local experience’ filter that is often used by employers against recruiting migrants.

Dr Guo said tackling employer discrimination is not just an ethical responsibility but also important for Australia’s economic success.

“When qualifications are fairly recognised, when skills are matched to opportunity, everyone benefits – the worker, the employer, and the broader economy,” she said.

“In critical sectors such as health care, where skills shortages are acute, it makes little sense to overlook qualified individuals because their expertise and training were gained overseas.

“As Australia seeks to address its labour shortages and boost productivity growth, helping refugees find and retain jobs could contribute to building a more diverse and productive workforce,” Dr Guo said.

Why refugees in Australia still face barriers to good jobs | The National Tribune

Read the full report here: British Journal of Industrial Relations – Wiley Online Library