Understanding the informal economic activity of refugees in London (a Community Links and the Refugee Council Report)

A report on the cause of informal activity within refugees community by Community Links and the Refugee Council

Community Links and the Refugee Council released, in 2011 a report on the cause of the participation of refugees in informal activities. The report identify ways for refugees to enter mainstream employment and formalise their informal activities.  

Background of the study

In December 2009, the Mayor of London launched a three year strategy for refugee integration and committed to support an inquiry into London’s informal economy to identify ways for refugees to enter mainstream employment and formalise their informal activity.

The Greater London Authority (GLA) commissioned Community Links and the Refugee Council to conduct a small scoping study to examine the causes of informal economic activity within refugee communities and ascertain if there are ‘refugee-specific’ factors in relation to participation in the informal economy, or if the knowledge that exists about other groups also applies to forced migrants. This research is concerned with refugees who have permission to work in the UK, not those still in the asylum system or other types of migrants.

Main findings

A small proportion of the refugee population are working in the cash-in-hand or informal economy. Like non-refugee Londoners who work in the informal economy, the main reasons are poverty and barriers to accessing the formal labour market. There are refugee specific causes of informal working such as insufficient knowledge of entitlement to support and benefits, language difficulties, unfamiliarity with the way that the UK job market operates, employers not understanding refugee entitlement to work, limited recognition of skills and experience gained outside of the EU, experiences of protracted periods without work during the asylum process and delays in receiving paperwork when refugee status is granted.

To overcome these barriers, Community Links and the Refugee Council recommend that:

• Work Programme providers work with specialist refugee partners to deliver tailored employment support that target refugee barriers to employment.
•  Existing resources and guidance to employers and financial institutions on refugee entitlement to work are promoted through a reassurance campaign.
• Refugee status becomes a criterion for full fee remission for ESOL provision funded by the Skills Funding Agency.
• New government initiatives to simplify regulations and processes, and support for business start-ups, includes specialist support to formalise informal businesses.
• A formalisation service pilot is run that will help individuals get their previous informal work experience acknowledged, without the fear of sanctions.

To download the report click here: Understanding the informal activity of refugees in London.