This paper examines the impact of large-scale Venezuelan migration on the female labor market in Colombia. More than 1.5 million Venezuelans migrated to Colombia in the period 2016–2019 due to the economic and social crises in Venezuela.
The analysis is based on data from the Colombian household survey for the period 2013–2019. The authors exploit the variation in the concentration of Venezuelans across Colombian departments over time. They consider the non-random settlement of Venezuelans across Columbian departments by modeling (using an instrumental variables approach) the share of people living in each state of Venezuela in 2011 (before the Venezuelan exodus) and the distance between those states and the departments of Colombia.
Main findings:
- The arrival of Venezuelan migrants negatively affected the labor force participation of native women. An increase in the share of Venezuelan immigrants of one percentage point caused an average reduction in labor force participation close to 0.7 percent relative to 2013.
- Venezuelan migration negatively affected the employment rate of native women. An increase in the share of Venezuelan immigrants of one percentage point, caused an average reduction in the employment rate of 0.8 percent relative to 2013.
- Inflows of Venezuelan migrants reduced the average weekly working time of native women. An increase in the share of Venezuelan immigrants of one percentage point, decreased the average weekly working time by 0.4 hours.
- These results hold only for low- and medium-skilled native women. There were no significant effects on the labor force participation, employment and working time of high-skilled native women.
- For high skilled native women with at least one dependent child of 5 years of age or younger, Venezuelan migration had a positive impact on the labor market participation, employment, and average weekly working time of high-skilled native women. A one percentage point increase in the share of Venezuelan immigrants increased the labor force participation of high-skilled women with dependent children close to 0.5 percent, increased their employment rate by 1 percent, and increased their average weekly working hours by 1.4 hours, relative to 2013.
- Venezuelan migration increased the probability of hiring live-in domestic workers in the households of high-skilled Colombian women with children. There was also a drop in the hourly wage of female domestic service workers which supports the hypothesis that immigration reduced the cost of childcare. Additionally, there is evidence of a negative effect of Venezuelan migration on the hours spent on childcare by high-skilled native women with at least one child, which are substituted by more hours in the labor market.
The authors conclude that the sudden influx of Venezuelan migrants reduced the labor force participation of less-skilled native women but positively affected the labor force participation for high-skilled native women with children. The authors find evidence that Venezuelan migrants reduced the cost of childcare, making it more affordable for high skilled native women to hire domestic workers, spend less time on childcare, and instead earn an income in the labor market.