Endemic Forms of Migrant Exclusion in European Unemployment Insurance Systems

The study addresses the so-called generosity hypothesis which states that welfare states with high benefit coverage and income replacement are by design more inclusive towards foreign-born immigrants. Generous welfare states are built on egalitarianism and a collective responsibility for individual social risks. Foreigners are therefore expected to enjoy an overall higher level of social protection in countries with more extensive benefit systems. It is argued in the study that this hypothesis may hold in regard to certain elements of the welfare state such as child benefits or social housing. However, it can be contested for the case of public unemployment insurance. Newcomers - refugees and labour migrants alike - are less likely to fulfil basic requirements such as a minimum length and level of paid contributions. Unemployment insurance systems thus carry an endemic form of migrant exclusion that leads to larger financial gaps between the foreign- and native-born in more generous benefit systems. Empirical analyses with micro-level income data for 14 Western European countries provide supporting evidence for the proposed hypotheses. Both European and non-European immigrants are significantly less likely to receive unemployment benefits than native-born individuals with a similar record of unemployment. This gap widens with the level of benefit coverage and income replacement, indicating a negative relationship between benefit generosity and migrants’ social protection.