Refugee Entrepreneurship in Australia:
One Strategy to overcome refugees
blocked labour market mobility
Paper to the Brotherhood of St Laurence Research Forum
From Surviving to Thriving: Inclusive work and economic security for
refugees and people seeking asylum,
7th December 2016, University of Melbourne
By
Jock Collins,
Professor of Social Economics, UTS Business School
[email protected]
Structure
1. Refugees and asylum seekers : blocked mobility in labour market
2. Entrepreneurship a long-standing response to immigrant blocked
labour market mobility
3. Refugee Entrepreneurship in Australia: an overview
4. Refugee Entrepreneurship in Australia: new research insights
5. Assisting Newly-arrived refugees to start up a business in Sydney
6. Policy implications
1. Refugees and asylum seekers : blocked
mobility in labour market
• Humanitarian entrants to Australia experience greater socio-economic
disadvantage in Australia than do other immigrants, particularly in the
labour market.
• One-third of humanitarian entrant settlers remain unemployed after three
years of settlement in Australia (Hugo 2011:104).
• When they do get jobs, humanitarian immigrants face what Hugo (2011:
109) calls ‘occupational skidding’, that is, they do not get jobs
commensurate with their qualifications and generally end up working in
low skill and low-paid occupations irrespective of their human capital
(Colic-Piesker 2007).
• Formal and informal discrimination blocks the mobility of refugees in the
Australian labour market
2. Entrepreneurship a long-standing response
to immigrant blocked labour market mobility
• Immigrants from minority backgrounds have long experienced formal and
informal labour market discrimination in Australia.
• In response to this blocked mobility many immigrant minorities turned to
entrepreneurship, to establishing a small business, as a way of providing for
their family, getting their children educated and escaping discrimination by
becoming their own boss.
• These migrant enterprises were embedded in the family and in the
immigrant (Diasporic) community.
• Most immigrant entrepreneurs were in micro or small businesses though a
few rose to spectacular heights (eg Frank Lowy)
• Their Australian born children had Australian education and human capital,
became professionals or got good jobs, so they generally shunned
entrepreneurship .
Immigrant Entrepreneurship in Australia – a
brief history
• Prior to WW11: Many immigrants from Non-English speaking
background experienced explicit and official racial discrimination in the
labour market and established businesses as a way of economic
survival”: cf ‘blocked mobility
• E.G. immigrants from China (Choi 1975; Wang 1988; Yuan 1988),
Greece (Price 1963), Italy (Collins 1992; Pascoe 1988, 1990) and
Lebanon (McKay and Batrouney 1988), and Jewish immigrants also
exhibited high rates of entrepreneurship (Glezer 1988; Rubenstein
1988; Rutland 1988).
• By 1947 more than half the immigrants born in Greece, Poland and
Italy, and more than a third of those born in Germany, Malta and the
former Yugoslavia, were self-employed or employers, compared to only
a fifth of the Australian-born (Collins 1991: 89-90).
Immigrant Entrepreneurship in Australia
today
• Census data shows that some immigrant groups, such as the Koreans,
Taiwanese, Greeks and Italians have at least a 50 per cent higher
presence as entrepreneurs compared to the Australian-born. Koreanborn women exhibit a presence among the female self-employed that
is almost three times that of Australian-born women.
• Immigrants born in China, Singapore, Malaysia, Egypt, Lebanon, Poland,
Ukraine , UK, USA, NZ and Canada have similar rates of
entrepreneurship compared to the Australian average.
• Immigrants from Japan, India, Sri Lanka, Vietnam, Indonesia and Turkey
have lower than average rates of entrepreneurship.
• Ethnicity over-rides gender in this respect, with similar rates of
entrepreneurship for males and females from the same country.
3. Refugee Entrepreneurship in Australia: an
overview
• KEY PARADOX: Refugees face the greatest barriers to entrepreneurship, yet
they have the highest rates of entrepreneurship of all categories of entry of
immigrants. Why??
• We need to look at the literature on immigrant entrepreneurship (Ivan
Light, (Light 1972; Light and Gold 2000) - Ethnic resources, class resources;
Waldinger, Aldrich and Ward (1990) – group characteristics and
opportunity structures; Kloosterman and Rath (2001, 2003) – mixed
embeddedness and to the theory of Diasporic entrepreneurship (Henoch
2007, Newman et al 2010, Rezaei, 2011).
• This must be situated within the political economy of refugee settlement
in Australia and a social ecology of refugee settlement and refugee
entrepreneurship in Australia.
Humanitarian entrants face the greatest
barriers to entrepreneurship in Australia
• They have no financial capital to start up a new business, not credit history, no
assets to mortgage, and no security.
• Their educational qualifications are often not recognised in Australia and with no
acknowledged human capital they can’t get a job or, if they do, get one well
below their ability.
• Most have no social networks of established family and friends to provide capital,
advice and support, lacking the social capital that many non-refugee immigrant
entrepreneurs in Australia have been able to draw on.
• Many did not have strong English-language fluency (ie they lacked linguistic
capital)
• Newly-arrived refugees also have little or no knowledge of the Australian rules
and regulations and red-tape that all new entrepreneurs must overcome. They
also had little familiarity with the local market and business opportunities, the
informal knowledge the new entrepreneurs must possess.
Yet….Humanitarian migrants are the most
entrepreneurial of all immigrants!
• “Humanitarian migrants were the most entrepreneurial while skilled migrants generated the most
income in 2009-2010, according to figures released for the first time by the Australian Bureau of
Statistics” (ABS 4 September 2015)
• Personal Income of Migrants, Experimental, Australia, presents detailed information on the
sources of personal income that migrants received for the 2009-10 financial year from the
Personal Income Tax and Migrants Integrated Dataset (PITMID).
“This is an exciting first release of experimental data and results show some distinct differences in
the personal incomes of migrants influenced by visa stream, period of residence and gender,” said
Jenny Dobak from the ABS.
“While almost two-thirds of migrant taxpayers were migrants with a Skilled visa — reporting $26
billion in Employee income — Humanitarian migrants displayed greater entrepreneurial qualities
and reported a higher proportion of income from their own unincorporated businesses and this
income increased sharply after five years of residency.”
• Source: http://www.abs.gov.au/AUSSTATS/[email protected]/Previousproducts/3418.0Media%20Release12009-10?opendocument&tabname=Summary&prodno=3418.0&issue=200910&num=&view=
Refugees More Entrepreneurial than other
Australian immigrants
Source http://qz.com/495390/refugees-the-most-enterprising-migrants-in-
australia/
Refugee enterprise formation by years in
Australia
Source http://qz.com/495390/refugees-the-most-enterprising-migrants-in-australia/
MIGRANTS, Proportion of migrant income, By source of
income, Visa stream and Applicant status, 2009-10
Source: ABS http://www.abs.gov.au/AUSSTATS/[email protected]/Lookup/3418.0Main+Features12009-10?OpenDocument
4. Refugee Entrepreneurship in Australia: new
research insights
• ARC Discovery Grant (2015-17) DP150104059 “Humanitarian
immigrant entrepreneurs in private and social enterprises” (with
A/Prof Branka Krivokapic-Skoko (CSU)
• Aim is to survey as many refugee entrepreneurs as possible across
Australia in order to: tell their stories; understand their
entrepreneurial history (if any) and their motivations for establishing
a business enterprise; explore the dynamics of their business
enterprises and the economic and social contribution that they make
in Australia; explore the strategies that they used to overcome the
substantial barriers that they faced; develop policy implications.
Fieldwork to date
•
•
•
•
•
25 Hazara refugee entrepreneurs in Adelaide;
25 refugee entrepreneurs from African countries in Brisbane;
15 refugee entrepreneurs in Melbourne
3 refugee entrepreneurs in Wagga Wagga
The key story is one of hard work and commitment to the future of their
families in Australia. Many had a personal or family story of
entrepreneurship prior to coming to Australia, often in more informal
business settings; Their businesses are embedded in their family and their
refugee community
• The contradictions of mandatory detention: Many Hazaras are in business
with other Hazaras they met in detention camps in Australia.
5. Assisting Newly-arrived refugees to start up
a business in Sydney
• The Ignite! Small Business Start-Ups program
• Settlement Services International (SSI) Sydney
• 240 clients from 30 countries:
• Most clients come from countries in the Middle East, with most from
Iran (87), Iraq (34) and Syria (23).
• 186 of the Ignite clients – or almost eight out of ten --‐ are male and
54 female.
• Most of these clients arrived in Australia holding either an 866 Visa or
200 Visa.
Suburb in Sydney where the Ignite Client Lives
ARNCLIFFE
ASCOT VALE
AUBURN
BANKSTOWN
BAULKHAM HILLS
BELMORE
BERALA
BEVERLY HILLS
1
1
16
4
2
1
1
1
CASULA
CHATSWOOD
CHESTER HILL
CHIPPING NORTON
CONDELL PARK
CORDEAUX
DARLINGHURST
DEE WHY
1
3
2
3
2
1
1
2
1
1
2
11
1
1
1
17
PLUMPTON
POTTS POINT
PRAIRIEWOOD
PUNCHBOWL
QUAKERS HILL
RABY
REVESBY
ROCKDALE
1
1
1
4
1
1
2
1
1
ROSEBERY
1
1
LALOR PARK
LEICHHARDT
LIDCOMBE
LIVERPOOL
MARAYONG
MARRICKVILLE
MARSFIELD
MERRYLANDS
MERRYLANDS
WEST
MINTO
BLACKTOWN
3
DUNDAS
2
BONNYRIGG
1
EASTLAKES
1
ROSEHILL
1
BOSSLEY PARK
2
EASTWOOD
1
MOOREBANK
1
ROUSE HILL
1
BRIGHTON-LE-SANDS
1
FAIRFIELD
17
8
RYDE
1
BURWOOD
1
GRANVILLE
4
4
SEVEN HILLS
4
CABRAMATTA
1
GREENACRE
2
MOUNT DRUITT
NORTH
PARRAMATTA
NORTHMEAD
1
SILVERWATER
4
CAMPBELLTOWN
1
Greenwhich
1
ORANGE
1
SMITHFIELD
3
CAMPSIE
2
GUILDFORD
6
OXLEY PARK
1
SOUTH GRANVILLE
3
CANLEY VALE
1
HAMMONDVILLE
1
PADSTOW
2
ST MARYS
1
CARLINGFORD
1
HARRIS PARK
1
PANANIA
1
STANMORE
2
CARRAMAR
2
HOMEBUSH
1
PARRAMATTA
16
STRATHFIELD
1
CARTWRIGHT
1
HURSTVILLE
1
PENDLE HILL
1
TOONGABBIE
4
CASTLE HILL
1
LAKEMBA
8
PETERSHAM
1
WENTWORTHVILLE
1
WESTMEAD
WILEY PARK
WILLOUGHBY
WOODBINE
YAGOONA
Unreported
1
1
1
2
3
13
Industries where Ignite clients want to establish
their new business enterprise
Business Class
Ideas
A - Agriculture, Forestry and Fishing
1
C - Manufacturing
4
D - Electricity, Gas and Water Supply
6
E - Construction
18
F - Wholesale Trade
10
G - Retail Trade
50
H - Accommodation, Cafes and Restaurants
26
I - Transport and Storage
5
J - Communication Services
5
L - Property and Business Services
19
N - Education
1
O - Health and Community Services
2
P - Cultural and Recreational Services
22
Q - Personal and Other Services
28
Unreported
7
59% of participants had run their own
business before migrating to Australia.
Transition to business in Australia - all participants
wage earner to
businessperson
41%
same kind of business
36%
different business
23%
Reasons for starting a business in Australia.
Reason for starting a business in Australia
Number
of
Participants*
It is interesting/ satisfying / love doing it
26
Prior experience in the same kind of business
12
For a secure future/make a living
11
Like to be my own boss/independent
10
Has business experience generally / good at it
7
Demand for the particular business / niche market
5
Could not get work
3
Family business networks in previous country
3
Bring my culture to Australia
3
Integrate into Australian society
2
Barriers to starting up the business in
Australia – male participants
Barriers and difficulties in starting the business in Australia
Number
Participants*
Marketing
14
Obtaining/managing finance
12
Language/communication
9
Lack of (Australian) business knowledge/bureaucracy
8
Building a supply/client/distribution network
6
Competition from other businesses
4
Aligning with (Australian) client tastes
4
Finding reliable associates/staff
2
Logistical (transport for equipment)
1
Visa restrictions
1
of
Male Ignite Entrepreneurs still receiving
Centrelink Benefits
Centrelink benefits - male participants
Expect to be off benefits in 2 years
3%
Probably on benefits for long term
(age pension)
3%
Expect to be off benefits in 1 year
13%
Expect to be off benefits in six months
10%
Expect to be off benefits in a few
months
3%
Not receiving Centrelink
benefits
68%
Female Ignite Entrepreneurs still receiving
Centrelink Benefits
Centrelink benefits - female participants
Expect to be off benefits in 2 years
12%
Expect to be off benefits in 1 year
13%
Not receiving Centrelink
benefits
75%
6. Policy Implications
• Entrepreneurship is a pathway to overcome blocked mobility in the
Australian labour market for many refugees.
• Refugees have overcome almost insurmountable barriers to establish
a business in Australia. Most of these business enterprises provide
moderate incomes, get refugees off centre link payments, provide
employment for other refugees and enable refugees to better
provide for their families.
• Refugee entrepreneurs make important economic and social
contributions to Australia.
• The Ignite! program provides a successful model to support newly
arrived refugees to establish a business in Australia. It should be
rolled out nationally in metropolitan and non-metropolitan areas.