Temporary Protection, permanent effects? The labor market impact of Ukrainian refugees in the European Union

The Russian invasion of Ukraine on 24 February 2022 triggered one of the largest refugee movements in Europe since World War II, with millions of Ukrainians seeking safety abroad. Czechia, Germany, and Poland emerged as primary destinations. Activation of the EU's Temporary Protection Directive granted Ukrainian refugees immediate access to host-country labor markets, creating substantial labor supply shocks. This study examines the impact of the inflow of Ukrainian refugees into the workforce in these three countries using quarterly individual-level microdata from the European Union Labor Force Survey (EU-LFS) between 2017 and 2023. Leveraging regional variation in exposure to Ukrainian employees, we estimate the effects of refugee employment on local employment, unemployment, inactivity, and working hours. We find no population-wide displacement effects, consistent with prior evidence for Czechia. However, subgroup analyses reveal heterogeneous impacts across countries. In Czechia, low-educated men benefited from increased labor demand, whereas in Poland, low-educated men experienced adverse effects. In Germany, secondary-educated men faced greater competitive pressure, reflected in an acceleration of early retirement. These differences likely stem from cross-country variation in refugee skill composition and bureaucratic barriers to labor market entry. Our findings highlight how institutional context shapes refugee integration and mediates the effects of large labor supply shocks on vulnerable segments of the local workforce.