1. Introduction

This study aims to explore the perspectives and experiences of Nordic employers regarding the recruitment of immigrants (See "definition in" Text box 1). The focus is on jobs in elementary occupations for immigrants with lower educational backgrounds from outside the EU, given the distinct challenges they encounter in Nordic labour markets (Calmfors & Sánchez Gassen, 2019).

The Nordic countries are facing labour shortages across various sectors and many geographical areas (Norlén et al., 2022). These challenges are further exacerbated by an ageing population, population decline and structural shifts in the economy (Räisänen & Tallamaria, 2019). At the same time, there has been a substantial increase in migration to the Nordic Region – particularly since the 2015 refugee crisis and the more recent crisis sparked by the Russian invasion of Ukraine in 2022. At present, there are approximately 3.5 million immigrants residing in the Nordic countries (Norden, 2022). The integration of refugees and migrants into the Nordic labour market offers multiple opportunities to address these labour shortages (ILO, 2023).

Research shows that it is difficult for refugees and migrants to find jobs, especially for lower-skilled, non-EU-born and refugee women (Calmfors & Sánchez Gassen, 2019). The employment gaps (see Figure 1) between native-born individuals and those from outside the EU have been relatively large across all of the Nordic countries (especially Sweden), and these gaps widened further during the COVID-19 pandemic (Sánchez Gassen et al., 2021). A prevailing challenge in all of the Nordic countries today is labour market mismatch – in other words, the skills and prior labour market experiences of immigrants often do not align with those sought by Nordic employers (Barth & Zalkat, 2022). This discrepancy impacts both individuals and society at large. In Finland, for instance, estimates suggest that this mismatch results in an annual financial burden of approximately EUR 6–11 billion (Remmi, n.d.). Furthermore, there is a risk that the skills of foreign-born individuals are not being utilised in a way that is optimal for a well-functioning labour market. For example, some immigrants work in roles far below their actual skill level, which represents a missed opportunity for both the individual and society (Arbetsförmedlingen, 2017).

We define immigrants as individuals who have a foreign-born background and who are moving long-term or permanently to the Nordic countries. The focus of this study is on lower-educated immigrants from outside the EU, as they face distinct challenges when attempting to access the labour market. For the purposes of this study, this definition also encompasses refugees, asylum seekers, and their accompanying family members.

The focus of this study is on employers that offer elementary occupations involving more simple and routine tasks, and which have low requirements in terms of skills or educational attainment levels. Examples of elementary occupations include cleaners and helpers, agricultural, forestry and fishery workers, food-preparation assistants, and sales and service workers (ILO, 2023).

Figure 1. Employment rate, persons aged 20-64 years, by citizenship, 2022

Source: Eurostat

One reason for a labour market mismatch is the limited availability of low-skilled jobs in the Nordic economies, which poses significant hurdles for immigrants with lower educational attainment when trying to enter the labour market (Calmfors & Sánchez Gassen, 2019). Eurostat data shows that Sweden and Norway have the lowest share of employees working in elementary occupations (around 4%). In Finland and Iceland, this figure is around 6–7%, while in Denmark it is approx. 10% (Sánchez Gassen et al., 2022) (see Figure 2).

Source: Eurostat

The successful integration of immigrants in the labour markets is essential for the Nordic societies’ economic and social prosperity (Ek & Skedinger, 2019; Helgesson et al., 2020; Räisänen & Tallamaria, 2019; Stevens et al., 2008). A report from the Finnish Ministry of Finance (2021) reveals that the projected growth of the Finnish economy between 2019–2030 is approximately 50% lower compared to Norway and Sweden. According to the report, this is due to several factors, such as low productivity growth, low employment rates and also relatively lower immigration rates.

Furthermore, successful integration is crucial for supporting the Nordic welfare model, which relies on high employment levels and on generous wage subsidies. Studies have shown that wage subsidies are effective in combating long-term unemployment among immigrants and other groups (Calmfors & Sánchez Gassen, 2019). Additionally, the 2019 White Paper by the Expert Group for the Norwegian Ministry of Labour and Social Inclusion emphasized the success of wage subsidies in helping immigrants’ transition into employment (Ministry of Labour and Inclusion, 2021). These subsidies are especially vital in enhancing employers’ willingness to employ immigrants with low language or other skills (Calmfors & Sánchez Gassen, 2019).

In recent years, there has been a growing emphasis on employers’ social responsibility in the immigrant integration process (Jensen, Sara, 2018; Lämsä et al., 2019). Both private and public employers play a pivotal role in facilitating integration by providing job opportunities, training and mentorship programmes for immigrants. Furthermore, especially in rural contexts, employers are considered to have a crucial role not only in influencing immigrants’ employability through their commitment to diversity, but also in shaping local residents’ perceptions of immigrant workers (Lämsä et al., 2019).

Lundborg and Skedinger (2016) emphasise that current understandings of integration in labour markets largely focus on factors at individual level and from the immigrants’ perspective. These include factors that affect the employability of immigrants and their integration in the labour market, such as  lack of language skills  and professional networks, low education, lack or little experience of work in the host country (Nshom et al., 2022; Shumilova et al., 2012). Other studies examine income differences between non-EU immigrants and natives (Sarvimäki, 2011), the provision of integration services (OECD, 2018), or how different welfare policies affect employment (Calmfors & Sánchez Gassen, 2019).

At the same time, there is a limited understanding of the specific roles that employers play in these integration processes in the Nordic countries – i.e. whether they are open to hiring immigrants or reluctant to do so, and the barriers or potential benefits they encounter. To contribute to filling this knowledge gap, this report provides an empirical study of employers’ perceptions and experiences from hiring immigrants in the five Nordic countries.

The Nordic Council of Ministers has a vision of becoming the most sustainable and integrated region in the world by 2030. This study is in line with its action plan’s objective of strengthening individuals’ ties to the labour market in the Nordic Region, especially among vulnerable groups, including migrants and refugees (Nordic Council of Ministers, 2022).

The report is structured as follows. Section 2 summarises the methodology and the research design. Section 3 is based on a literature review. It first highlights the benefits of hiring immigrants from employers’ perspectives, then explores the barriers that employers face in hiring immigrants, taking into account challenges that operate at the structural, organisational, and individual levels. Section 4 presents an overview of national wage subsidies and support for employers in the five Nordic countries. Section 5 explores examples from specific employers that have been particularly committed to hiring immigrants across the Nordic countries. Section 6 synthesises the main findings from the interviews in relation to the literature review, with a focus on motivation, benefits and challenges encountered by employers, as well as possible approaches for overcoming these challenges. The section further provides insights from interviews conducted with intermediary organisations (such as staffing companies). Finally, section 7 presents key Nordic learnings.