The Labor Market Impacts of Venezuelan Refugees in Brazil

As more and more Venezuelans leave their country, fleeing the economic and social crisis, the number of Venezuelans in Brazil has risen steadily since 2016, constituting about 18.6% of Brazil’s 1.4 million refugee and migrant population as of October 2020. Past research finds that the impacts of forced displacement on the labor market outcomes of host community are mixed and tend to depend on country characteristics. This chapter explores the economic impact of Venezuelan influx on Roraima, the state bordering the República Bolivariana de Venezuela at the north and the main gateway of the Venezuelan refugees entering Brazil, and focus on the formal sector employment of the host community. Using survey and administrative data along with the synthetic control method, this chapter finds that the Venezuelan influx displaced Brazilian workers in the formal sector in the short run. There is also evidence that informal employment has risen among college-educated individuals, accompanied by an increase in wages. This suggests that the Venezuelan influx has brought some productivity gains, although these effects are statistically weak.