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Labor market discrimination more topical than ever

The fear of losing your job is a familiar feeling for many people, especially those with a migrant background. Is finding a new job after losing it still doable? After the political debate Social Affairs and Employment on December 7, 2020, the discussion about labor market discrimination is more topical than ever: discrimination in the labor market should come to an end, according to most parties in the House of Representatives. Such debates or discussions usually focus on differences in origin, differences in gender and their effect on labor market opportunities. Today, perhaps another contextual factor plays a crucial role: Covid-19. What about discrimination in the labor market nowadays and does the corona crisis have any impact on this? Intelligence Group was the first to investigate this with the Labor Market Behavior Survey (Arbeidsmarkt Gedragsonderzoek). 

This research, conducted in 2020, provides some interesting results:
• The difference between groups, based on migration background and gender, seems only to be reinforced by the corona crisis;
• Women without a migration background are more likely to have a temporary contract of 1 year or less than men without a migration background, while this difference appears to be zero among the group of migrants;
• The corona crisis has hardly any impact on the fear of job loss when it comes to the group without a migration background, while the group with a migration background shows a significant increase;
• The impact of the pandemic on the labor market is still limited for the time being.

People with a migrant background face deterioration

Intelligence Group has been collecting labor market data on the Dutch labor force since 2003, which allows for a comparison across several years. A relevant and obvious comparison that we currently could make is the comparison between 2019 (a normal year) and 2020 ('corona year'). The AGO measures, among other things, what percentage of the Dutch working population has a temporary contract of one year or less, whereby a distinction can be made between gender and background.

Based on gender, there is no noticeable difference in the percentages with a temporary contract among the participants in the survey with a migration background. The group without a migration background does show differences between men and women, with women showing a 10% majority of having a temporary contract compared to men.

Furthermore, the number of temporary contracts among people with a migration background has increased in 2020 and decreased among people without a migration background. Hence, there seems to be an unbalanced development by background. The most striking result from this particular question can be seen between the male participants of both groups. Thirty percent of male migrants have a temporary contract of 1 year or less in 2020, while only 19% of male non-migrants had a temporary contract in this year, as shown in the graph below.

Source: Intelligence Group

Men with migration background more likely to be afraid of losing their jobs

The participants of the Labor Market Behavior Survey were also asked if they are afraid of losing their jobs in the upcoming year. Here again, a comparison can be made with the year 2019. Based on gender, a clear difference can be noticed particularly in the group with a migration background. Whereas the fear of job loss in 2019 was still at 10% for both men and women, in 2020 it rose for women to 14% and for men to 17%. Men with migration background are more afraid of losing their jobs in 2020 than women. "A potential explanation for this could be that men with a migration background may be more likely to be the (sole) breadwinner of the family and therefore experience greater pressure and responsibility, especially in these uncertain times," according to Fahim el Abbouri, Marketer at Intelligence Group. 

The difference with the groups without a migration background is remarkable. Among men without a migration background, the fear of job loss has remained the same compared to 2019 at 8% and among women it has only increased by 1%. Remarkably, in the group without a migration background, unlike the group with a migration background, the fear is higher among women than among men. However, this gender difference is virtually negligible, in contrast to the group with migration background.

Source: Intelligence Group

The continuing trend in the labor market

If we compare the current survey result with the results of the past eight quarters, a number of things stand out. In general, it can be concluded that the group with a migration background has performed worse in terms of results over the past eight quarters than the group without a migration background. The latter scores better on almost all points (e.g. unemployment or the number of job changes). The current figures therefore confirm what has already been known for some time. A striking and particularly positive change in the group with a migration background can be seen when asked whether the reason for a new job is 'dismissal or non-extension of contract'. Here it can be seen that the figures for the past eight quarters in particular for men are much higher, with as much as 23% compared to 15% today. The same pattern can be seen among non-migrants with again the largest decrease among the male group. This indicates that people are more likely to voluntarily leave their previous employer. The other constructs show similar results to 2020, with women still more likely to be on temporary contracts than men.

The view of 2021

All in all, it appears that much of the numbers have remained the same over the past year, with a few outliers that seem to go against the expectations that people had of the corona crisis. In particular, the group with a migrant background has experienced the effects of the pandemic noticeably. Yet a number of questions remain unanswered. Given the fact that the Labor Market Behavioral Survey is primarily descriptive in nature, it remains unclear whether the changes in numbers are actually due to the corona crisis. Similarly, when we magnify the figures between groups, some questions remain unanswered. For example, what is the explanation for the fact that workers with a migrant background are more afraid of losing their jobs in 2020, compared to non-migrants? To answer this question and to conclude whether this is actually caused by discrimination in the labor market further in-depth research is required. For now, these are the descriptive results and it remains a surprise from which side the labor market will show itself in 2021.