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A road map for integrating Europe’s refugees

By Frank Mattern, Eckart Windhagen, Solveigh Hieronimus, George Tsopelas, Jonathan Woetzel, and Anu Madgavkar

A surge of refugees and asylum seekers has strained the continent. Managing the asylum procedure and integrating those refugees well could not only mitigate risks but also benefit the economy.

A major study from the McKinsey Global Institute (MGI), People on the move: Global migration’s impact and opportunity, maps the patterns of migration and calculates its impact on the world economy. To complement this global perspective, a companion report takes a deeper look at how these issues are playing out in real time across Europe today.

Europe’s new refugees: A road map for better integration outcomes examines the surge of 2.3 million refugees and asylum seekers who arrived in Europe during 2015 and 2016. Although this episode is only a small part of the broader global phenomenon, it presented Europe with the most dramatic wave of forced migration the continent has experienced since the aftermath of World War II.

This cohort is unique in some ways. More than half of the asylum seekers originally came from the war-torn regions of Afghanistan, Iraq, and Syria (exhibit). Their movement occurred in two steps: after initially fleeing to safety in a neighboring country, many found harsh conditions and subsequently undertook longer, and often perilous, journeys to Europe, hoping to find a more viable life. Given recent trends in the acceptance rates of asylum applications, we expect that roughly 1.3 million will attain refugee status, which grants them the right to stay—and many could decide to put down roots for the long term.

More than half of asylum seekers who came to Europe in 2015—16 are from Afghanistan, Syria, or Iraq.

Europe is actively committed to carrying out its obligations under international law to offer safe haven and resources to refugees, and many Europeans have not hesitated to help people in desperate circumstances. But the political debate continues to swirl, in part because the refugees arrived as many European countries were struggling to shake off years of recession and austerity. The continent’s ability to absorb this influx is being put to the test.

There’s a great deal at stake in ensuring that these refugees are integrated into the labor market and into society more broadly. EU member states have not always been successful at integrating waves of immigrants, and repeating past mistakes could have adverse consequences. Refugees face the risk of isolation, unemployment, and poverty, while destination countries might experience strained welfare systems and segregated societies.

But managing the asylum process and the ongoing challenge of integration is not only about keeping risks at bay. It can also generate economic benefits. Improving outcomes for this refugee cohort can deliver an overall GDP contribution of some €60 billion to €70 billion annually by 2025, as well as a potential demographic boost that could benefit aging societies.

Europe’s first imperative is to make the asylum application process itself as streamlined and efficient as possible. Beyond ensuring that national and local systems run efficiently, greater cooperation is needed among countries and across the European Union more broadly. The longer-term challenge is improving the odds of integration for those who have the right to stay. Helping refugees fit into their new homes and become contributing members of society involves focusing simultaneously on four priorities: labor-market and economic integration, educational integration, housing and health integration, and sociocultural and language integration. While governments can lead these efforts, they will also need to enlist support and involvement from the private sector, civil society, and international and humanitarian organizations.

About the author(s)

Frank Mattern and Eckart Windhagen are senior partners in McKinsey’s Frankfurt office, Solveigh Hieronimus is a partner in the Munich office, and George Tsopelas is a senior partner in the Athens office; Jonathan Woetzel is a director of the McKinsey Global Institute, and Anu Madgavkar is an MGI partner.

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