This article investigates the relationship between the wage-productivity gap and perceived economic and social discrimination among Syrian refugee workers in Turkey. There are more than 3.5 million Syrian refugees in Turkey. Refugees are predominantly engaged in informal labor markets and face significant economic and social discrimination.
The analysis is based on survey data collected from December 2022 to February 2023, involving 450 firm owners/managers and 450 Syrian workers in Istanbul. Firm owners/managers provided information on the value of the marginal product created by workers, gross wages, firm age, total number of employees, and the nationality of the firm owner. Workers reported their gross wage, age, gender, education, duration of stay in Turkey, and experiences of social and economic discrimination.
Main findings:
- A higher wage-productivity gap is associated with increased perceived economic discrimination among refugee workers. Gender, education, duration of stay in Turkey, salary below the minimum wage, firm age, and firm size are also associated with perceived economic discrimination. In particular, more educated workers, those who have spent more time in Turkey, and those working for older and larger firms perceive less economic discrimination, while female workers perceive more. Worker age and firm owner nationality are not significantly associated with perceived economic discrimination.
- A higher wage-productivity gap is linked to higher perceived social discrimination. Worker age, gender, education, and duration in Turkey are also associated with higher perceived social discrimination. In particular, older and female workers report higher levels of perceived social discrimination, while more educated workers and those who have spent more time in Turkey report less. Firm-level variables such as firm age, size, and firm owner nationality are not significant in the regressions of perceived social discrimination.
- Respondents associate the wage-productivity gap more with economic discrimination than with social attitudes.
The authors conclude that workers experiencing a larger wage-productivity gap report higher levels of economic and social discrimination. Even if workers are unaware of their marginal product value, they likely understand the wage-productivity gap and associate it with economic discrimination. This gap is linked to both economic and social discrimination. The authors suggest that policies aimed at reducing this gap could help mitigate perceived economic and social discrimination among refugee workers. These policies may include initiatives to improve economic conditions for refugee workers and the enforcement of labor laws and regulations in informal labor markets, particularly laws concerning refugees.