Private-Sector Engagement: A key element of supporting returnee reintegration through employment

Executive summary

Economic reintegration support has long centred on small-scale entrepreneurship, providing returning migrants with start-up grants to establish microbusinesses in their countries of origin. However, emerging evidence points to high rates of business failure and limited livelihood sustainability, raising questions about the effectiveness of this approach. These challenges result from a combination of factors, including saturated markets, difficult business environments, and limited business skills and networks among returnees. Although entrepreneurship will remain an important option for some, insights from practitioners suggest that a broader range of economic pathways is needed to address the diverse profiles and constraints of returnees.

Against this backdrop, European donors, implementing partners, and countries of origin are exploring ways to work more systematically with the private sector to create employment opportunities for returnees. Employment can provide regular income, reduced financial risk, and opportunities for skills development and social cohesion, particularly for returnees with limited inclination towards entrepreneurship. Private-sector engagement is also viewed as a means of embedding reintegration in local labour markets, mobilising additional resources, and aligning with broader development strategies that support job creation in countries of origin. Yet the evidence base for what works remains limited, and many initiatives are still in the pilot stage.

'Employment can provide regular income, reduced financial risk, and opportunities for skills development and social cohesion, particularly for returnees with limited inclination towards entrepreneurship.'

This policy brief’s scoping of engagement practices to date identifies three main emerging practices: providing employment-focused support to individual returnees, reducing the expenses and risks that employers may face when hiring returnees, and strengthening frameworks for cooperation between government and the private sector. Support for individual returnees focuses on preparing them for employment through profiling, counselling, skills and soft-skills training, and job matching. To reduce the costs and perceived risks of hiring returnees, demand-side interventions can include providing equipment or grants to small and medium-sized enterprises that commit to hiring returnees, as well as subsidising internships and temporary placements for employers to assess candidates before offering permanent positions. Governance-oriented approaches seek to establish more durable frameworks for cooperation, such as national public-private platforms.

However, several cross-cutting challenges constrain the scale and impact of these models. One such challenge is matching diverse returnee profiles with demand in origin-country labour markets. Returnees often have fragmented work histories, limited formal qualifications, or skills acquired abroad that do not align with available job vacancies. Personal constraints, sometimes related to gendered dynamics, can also restrict which jobs are accessible. Employer perceptions of returnees present another challenge. Many firms view returnees as riskier hires and are concerned that they may migrate again, given their atypical work histories and gaps in documentation. Finally, employment services and other intermediaries often lack the expertise to match returnees with employment opportunities, suggesting a need for training on how to understand and address the unique circumstances of returning migrants.

These findings carry several implications for European donors, implementing partners, and origin countries. Labour market dynamics should inform expectations about what private-sector engagement in reintegration can achieve. Analysing priority sectors with growth potential, for instance, can help guide decisions about where to focus reintegration efforts that promote employment. At the same time, investing in public employment services and chambers of commerce can support institutional capacity development. More broadly, moving from pilots to systemic approaches will require donors to support models that link reintegration more firmly to national employment systems and development cooperation.

1. Introduction

Economic reintegration stands at the centre of efforts to support returning migrants, yet evidence points to limitations in current approaches. Although reintegration encompasses social, psychosocial, and economic dimensions, programmes have long prioritised economic support as the pathway to stability, income generation, and broader social cohesion. Most interventions have centred on small-scale entrepreneurship through start-up grants that help returnees build their own businesses. These grants work well for some returnees who have entrepreneurial aptitude and business experience, but evidence increasingly reveals high failure rates that demand reconsideration of which additional pathways should complement these approaches.

A recent evaluation of return and reintegration support funded by the German Federal Ministry for Economic Cooperation and Development (BMZ) found that most returnees’ microbusinesses were not profitable, and many failed within six months.1 More than two-thirds of returnees interviewed could not sustain their livelihoods at the time of the survey, which was conducted approximately 3.6 years after return. These failures stem from multiple, interconnected factors. Many returnees lack the business management skills, professional networks, and entrepreneurial temperament needed to succeed in competitive markets. Local economies are often saturated or difficult to penetrate for small-scale ventures, and challenging business environments marked by weak rule of law and corruption create additional obstacles. Perhaps most fundamentally, returnees frequently balance spending their grant funds on their start-up business with redirecting them towards immediate needs such as housing or health care, reflecting the acute pressures many face upon return. These limitations raise questions about alternative approaches to address returnees’ diverse economic needs and better connect them with the local ecosystem.

Stronger private-sector involvement offers compelling opportunities to complement traditional entrepreneurship support. Private-sector engagement can take multiple forms, including access to finance through banks and financial service providers, supply chain integration, and sector-specific partnerships, but employment is a particularly promising avenue for many returnees. Wage employment provides regular income with less risk than business ownership, skills development through on-the-job learning, and social integration through workplace networks. For returnees lacking business acumen or entrepreneurial drive, a stable job may provide a more realistic pathway to self-reliance than attempting to launch and maintain a business in an unfamiliar market.

The added value of private-sector engagement extends beyond individual employment benefits. Direct employment can achieve greater scale than individual business support, while skills transfer from companies to returnees through training and mentorship programmes can build human capital. Companies may also benefit from returnees’ international experience, language skills, and cross-cultural competencies gained abroad, creating mutual value. And the professional networks to which employment provides access can support longer-term integration in ways that individual entrepreneurship often cannot.

'The added value of private-sector engagement extends beyond individual employment benefits.'

These benefits point to broader systemic advantages. Private-sector involvement could strengthen social cohesion by engaging a wider range of societal actors in reintegration efforts, potentially reducing programme costs through public-private partnerships. Stronger employer engagement can also help shift public narratives about returnees as failures to recognising them as potential assets with valuable skills and experience. The involvement of local private-sector actors also aligns with broader efforts to ensure that stakeholders in origin countries, beyond national governments, are involved in reintegration processes, strengthening local ownership and sustainability of initiatives.

Expanding private-sector engagement in returnee reintegration also aligns with policy priorities emerging among key European donors and partner countries, creating potentially timely momentum for change. The European Union, for instance, is looking for synergies with private-sector actors to support the financial inclusion of forcibly displaced people, migrants, and returnees in various contexts.2 Moreover, the logic of developing public-private partnerships has gained appeal at a time of budget constraints, when governments and international organisations seek to leverage private resources and expertise alongside constrained public funding.

Despite these potential advantages, whether private-sector engagement (particularly through employment) can support more sustainable reintegration than entrepreneurship remains uncertain and requires additional research and evaluation. The argument in favour rests partly on the premise that engaging private actors brings added value that may be lacking in start-up grant programmes, which tend to be managed by the International Organisation for Migration (IOM) and nongovernmental organisations that often lack the same depth of business knowledge and experience. Yet significant questions remain about the conditions that enable successful private-sector engagement, barriers that prevent it from scaling, and how to design partnerships that benefit returnees and the broader public.

This policy brief examines the emerging practice of private-sector engagement in reintegration support for returning migrants, with a particular focus on employment while acknowledging other forms of engagement. Drawing on interviews with programme implementers, a literature review, and insights gathered during expert roundtables, the brief examines previous efforts to involve the private sector, draws lessons from those experiences, and highlights opportunities for future programming. Section 2 maps existing approaches and emerging practices, categorising interventions at the individual, company, and governance levels. Section 3 analyses the challenges that constrain both the scale and effectiveness of private-sector engagement and its effects on returnees, employers, intermediary organisations, and broader systems. Section 4 synthesises conclusions and recommendations for policymakers, donors, and implementers seeking to strengthen labour market pathways for returning migrants while acknowledging the limitations and trade-offs inherent in these approaches.

2. Approaches to improving employment prospects

Private-sector engagement in reintegration is uneven, yet a clearer landscape of practices has begun to take shape across diverse contexts, with the aim of improving employment prospects. Most programmes continue to prioritise support for small-scale entrepreneurship, but a complementary strand of work has emerged that focuses on connecting returnees with employment and helping employers tap into this labour pool. These approaches include individual support for returnees seeking employment, assistance for companies to encourage them to hire returnees, and governance structures to strengthen regular exchange and coordination among reintegration partners, local authorities, and private-sector stakeholders.

A. Individual-level support for returning migrants

Reintegration programmes use a range of tools to help returnees navigate their re-entry into local labour markets, from early preparation to hands-on support after arrival. At their core, these efforts seek to improve the employability of returning migrants and close information gaps that make it difficult for employers to assess returnees’ skills. Overall, most efforts focus on providing support after return, but a few smaller pilot projects aim to prepare returnees for employment before they depart.

• Predeparture trainings to strengthen employability. Some programmes provide predeparture coaching, skills assessments, or certification to improve returnees’ employment prospects upon return. For example, the Assisting the Reintegration of Returnees through Integrated Vocational and Entrepreneurship Support (ARRIVES) programme for migrants returning from Germany to Nigeria offers participants skills assessments and certification before they depart, which participants can later present to employers in Nigeria.3 However, practitioners highlight important limitations to such approaches. Under the 2018–19 Austrian pilot initiative Supporting Sustainable Return of Migrants through Private-Public Multi-Stakeholder Partnerships (SUPREM), Nigerian migrants received predeparture coaching to support labour market reintegration after return,4 but in practice, the time frame between return decisions and departure was often too short for the initiative to provide meaningful coaching. Persons involved in the pilot also noted that many returnees had few formal skills, resulting in a mismatch between the upskilling measures offered and participants’ profiles and needs.5
• Post-arrival placement support. Most employment-focused approaches concentrate their efforts after return, when time pressures and uncertainty surrounding the return process have eased and local labour market opportunities are better understood.6 Efforts include, for instance, career counselling to determine whether individual returnees are better suited for employment or entrepreneurship and to match skills they possess with local labour market demand. In addition, programmes may offer targeted training or soft-skills coaching, and in some cases, partnerships with local employers can facilitate job placements. In Côte d’Ivoire, a joint effort between IOM and the Youth Employment Agency (Agence Emploi Jeunes, or AEJ) identifies employment opportunities for returning migrants.7 AEJ counsellors provide returnees with soft-skills coaching before facilitating contact with local companies. AEJ also familiarises companies with migrants’ specific profiles and seeks to address any employer doubts or questions.

B. Incentivising companies’ engagement through technical and financial assistance

Some programmes seek to improve labour market reintegration by addressing employer-side barriers to hiring through interventions such as financial incentives, recruitment support, and risk-sharing mechanisms designed to increase employer willingness and capacity to hire returnees.

• Incentivising returnee hiring through business and financial support. Several programmes have provided financial or technical support to companies that commit to hiring returnees. For example, between 2019 and 2025, BMZ’s INTEGRA project in Kosovo provided equipment or goods to employers for each returnee hired, targeting approximately 60 placements.8 The EU-funded Reintegration and Development Assistance in Afghanistan project moved beyond hiring incentives towards broader business development support.9 Under the project, IOM provided grants and business advisory services to local small and medium-sized enterprises to support business expansion. Returnee recruitment was integrated into firms’ growth strategies rather than treated as a standalone objective. By December 2020, 17 businesses the project supported had hired 104 returnees. Returnees had founded two of the businesses supported, suggesting potential spillover effects through which reintegration can generate employment opportunities for other returnees.10
• Reducing recruitment and administrative barriers for employers. Small and medium-sized enterprises often lack the capacity and resources to engage with reintegration programmes.11 To address this issue, some reintegration programmes have undertaken the preparation and prescreening of candidates for interested companies to reduce costs and facilitate engagement. For example, the United Nations Development Programme (UNDP) tested different ways to incentivise the private sector to hire returnees in the Western Balkans.12 In an initial pilot, UNDP provided small subsidies (about 1,500 euros) to employers to support them in hiring returnees, but uptake was low because of burdensome administrative requirements (for instance, detailed reporting obligations and monitoring visits). UNDP subsequently offered larger grants of between 5,000 and 10,000 euros to firms combined with mentorship and business development support, which resulted in increased employment among returnees and additional job creation for non-returnees as firms expanded.13 Although this approach can lead to successful placements, it raises questions about durability beyond project timelines, as well as the broader integration of returning migrants into mainstream job placement services in origin countries.
• Subsidising internships to reduce hiring risk. Where employers hesitate to make hiring commitments, some programmes have also promoted internships to give returnees on-the-job experience and employers an evaluation period before taking permanent placement decisions. For instance, wage-subsidised internships through the ARRIVES programme in Nigeria14 allow employers to assess returnee performance with reduced financial commitment but with an understanding that successful candidates may transition to permanent employment. However, this pragmatic response to employer uncertainty raises questions about costs per placement and whether subsidised positions genuinely convert to stable employment or simply delay rejection. Evidence on conversion rates is limited so far, making it difficult to assess whether this investment produces lasting employment relationships.

C. Creating enabling infrastructure via governance changes

Some initiatives work at the governance level to establish frameworks that facilitate private-sector engagement and improve employment opportunities for returning migrants.

• Public-private platforms and networks. Reintegration and development partners have sought to establish national coordination platforms to formalise private-sector involvement in reintegration and facilitate dialogue and coordination. The Dialogue on Return Migration event, organised by Swisscontact through its Perspectives for Returnees through Social and Professional Integration (PERSPECTIVAS) project, opened channels for public and private actors in Central America to address barriers and share information, rather than relying on ad hoc consultations.15 The dialogue brought together government officials responsible for migration policy, representatives of employer associations, and civil-society organisations supporting returnees. Regular meetings provided a forum to discuss practical obstacles, such as challenges related to credential recognition and employer concerns about documentation. Similar approaches were piloted in Bangladesh and Iraq through the International Centre for Migration Policy Development, which convened regular meetings between government officials, employers, and civil-society organisations to discuss reintegration challenges and opportunities.16 In Bangladesh, for example, the local network of business associations supported regular platform meetings and thematic working groups, helping stakeholders develop a shared understanding of issues such as skills recognition and access to finance.17
• Sector-specific and value-chain approaches. Some programmes have adopted more targeted approaches that identify specific sectors or value chains with growth potential and opportunities for returnee integration.18 For example, the PERSPECTIVAS programme in Central America conducted local value chain analyses to identify entry points for returning migrants seeking employment and concentrated support on areas with the most promising market potential.19 Training content was then tailored to these opportunities rather than delivered as general skills training. Similarly, the ARRIVES programme conducted labour market mapping to analyse which sectors in Nigeria showed growth, the skill levels they required, and the wages employers typically offered.20 The analysis indicated that the construction sector showed strong demand, but average starting wages were below the level that many returnees needed to sustain themselves. Conversely, the hospitality and retail sectors offered entry points that matched the skill levels of many returnees and provided wages sufficient to meet basic needs. Based on these findings, reintegration counsellors helped returnees prepare targeted curricula vitae and job applications for those sectors.

3. Challenges to scaling employment-based reintegration approaches

Despite growing interest and experimentation with employment-based reintegration approaches, initiatives continue to face difficulties achieving sustainable impact or operating at scale. Barriers can emerge at multiple levels and stages of the return and reintegration process, including those related to returnees’ skills and expectations, employers’ willingness and capacity to hire, and the institutional and labour market conditions in which reintegration programmes operate.

A. Matching returnees’ skills with labour market needs

A key challenge relates to returnees’ diverse profiles and the frequent disconnect between their skills and the skills in demand in local labour markets. Returnee populations vary widely in educational attainment, work experience, language abilities, and personal circumstances. Some have acquired sector-specific experience from working abroad for many years, as well as formal degrees, technical certifications, and foreign language skills that may be valuable in certain contexts. Others have low literacy levels, gaps in basic education, interrupted work histories, and care responsibilities that constrain when and where they can work.21

'Returnee populations vary widely in educational attainment, work experience, language abilities, and personal circumstances.'

In European assisted voluntary return and reintegration programmes, many returnees have limited formal qualifications and fragmented employment backgrounds, making employment matching more difficult.22 Experience from the Western Balkans also illustrates how personal circumstances, including gender-specific constraints, shape employment opportunities after return.23 For instance, for women with care responsibilities, flexible work hours or child-care options can help create realistic work opportunities and achieve greater labour market participation. Experience from the ARRIVES programme also shows how credentials can influence employers’ willingness to hire returnees.24 Formal certifications can give individuals a comparative advantage over those without recognised qualifications. Even when returnees possess valuable skills, however, those skills may not align with available vacancies in origin countries. Training and experience gained in host countries may not automatically translate to origin-country labour markets because of differences in sectoral labour demand, technological gaps between workplaces in origin and host countries, or credential recognition issues that prevent recognition of formal qualifications.25

B. Overcoming administrative hurdles and employer stigma

Some companies are reluctant to hire returnees because of concerns about risk and social perceptions. From employers’ perspectives, hiring returnees may appear both riskier and more cumbersome than relying on their usual recruitment channels. Returnees often present atypical profiles, including a curriculum vitae with gaps, foreign work experience that cannot be easily verified or certified according to local standards, and fewer local professional references than candidates who have never migrated. Recruitment through reintegration programmes can also add coordination requirements and procedural steps, such as screening and documentation requirements or reintegration monitoring, which firms may view as more paperwork than their standard practices require.

Stigma and negative perceptions can create additional barriers to employer engagement.26 Employers may make assumptions about returnees’ reliability or commitment, while some worry about low retention rates if they suspect returnees may attempt to migrate again once they have stabilised economically. Some reintegration programmes have tried to address these concerns by highlighting returnees’ international exposure and skills in their outreach to employers.27 This approach emphasises returnees’ assets, including foreign language abilities, cross-cultural competencies, and exposure to different work environments, rather than focusing on their migration history. Yet individual programmes alone cannot change employer biases, which requires consistent messaging, positive experiences with returnee employees, and broader changes in public discussion about return migration.

C. Building sustainable approaches via public employment services and chambers of commerce

Some reintegration programmes have begun building direct partnerships with individual employers through memoranda of understanding or commitment letters. Such partnerships can generate job placements for returnees,28 but they also raise questions about longer-term sustainability and whether they are creating parallel support structures that are inaccessible to other job seekers in origin countries.

Building sustainable employment pathways for returning migrants therefore requires stronger links between reintegration support and existing labour market institutions and employment systems in origin countries. Cooperation with public employment services, chambers of commerce, industry associations, and other mechanisms that already connect job seekers with employers can support this effort. Embedding reintegration support in these structures could help improve sustainability, expand scale, and reduce dependence on project-based partnerships with individual firms.

At the same time, integrating returnees into mainstream labour market institutions presents its own challenges. Public employment services may offer greater scale and cost-effectiveness because they already operate across many return contexts, but they often face resource and staffing constraints. Employment service staff may also have limited experience or training in supporting individuals returning from abroad. In labour markets characterised by high unemployment and low vacancy rates, returnees may prove more difficult to place, particularly where they have few formal qualifications or interruptions in their employment trajectories. Concerns have also emerged in some cases about the quality of employment opportunities and labour protections associated with placements secured for returning migrants, highlighting the importance of aligning reintegration efforts with broader decent work standards.

Chambers of commerce and industry associations can reach many firms at once and thus become credible brokers in fragmented markets. In Mauritania, the Chamber of Commerce, Industry, and Agriculture has functioned as a formal referral destination for training and vocational opportunities, providing a channel through which returnees can access potential employers.29 The chamber’s endorsement lends legitimacy to reintegration programming and opens doors that might otherwise remain closed to individual organisations. Yet chamber engagement can remain consultative unless linked to a brokerage or referral mechanism. Chambers of commerce also typically lack detailed information on current vacancies, such as specific job openings, the offered wages, and prevailing working conditions, all of which are required for effective job placement.

Taken together, these challenges show that an employer’s willingness to consider hiring returning migrants is rarely the main or only constraint to effective employer engagement. Outcomes depend on labour demand, sustained intermediary capacity, and whether programme incentives and monitoring frameworks prioritise durable, quality placements over short-term outputs.

4. Conclusions and recommendations

Private-sector engagement in reintegration processes remains uneven and largely limited to the pilot initiatives described in this brief. These projects reflect both the limitations of entrepreneurship-based reintegration models and growing recognition that employment can provide an alternative for returning migrants who do not want to start their own businesses. The following insights from different contexts highlight constraints and trade-offs that determine whether private-sector engagement can contribute meaningfully to reintegration outcomes:

• Labour market realities in origin countries set the ceiling for what programmes can achieve. Even strong programme delivery cannot create jobs where demand is weak or employment is concentrated in a small number of sectors or locations. Approaches grounded in labour market and value chain analyses can help identify where opportunities exist and where interventions should focus. In some settings, programmes have combined reintegration objectives with broader support to firms and local economies, recognising that job outcomes depend as much on strengthening labour demand as on assisting returnees.
• Matching returnees with employers requires significant institutional capacity. Many employers are not inherently reluctant to engage with returnees; in many settings, they express openness when programmes reduce recruitment risks. The main constraint lies in the intensive work of preparing candidates and matching them with employers. This constraint points to the importance of embedding employer engagement in specialised and durable structures in origin countries, such as employment services and chambers of commerce.
• Reintegration depends on both placements and the stability and quality of jobs. Placement numbers are the main success indicator in many reintegration programmes, but they reveal little about the quality or sustainability of reintegration efforts. Insights from practitioners indicate that longer-term outcomes also depend on whether returnees can remain in work, earn adequate wages, and benefit from fair and ethical work conditions.

These insights show that successful private-sector engagement is a system-building endeavour. Success requires enabling conditions such as trustworthy intermediaries, employer incentives aligned with business needs, and adequate labour standards. This approach is also consistent with broader efforts to strengthen links between reintegration support and development cooperation, reducing fragmentation and enabling more sustainable, jointly owned approaches. Without these foundations, initiatives risk remaining small-scale pilots that generate promising but uneven results.

Programmes could therefore prioritise the following three elements that appear most promising for achieving sustainable outcomes:

1. Start from labour market demand and adjust interventions accordingly. Programmes that systematically conduct labour market assessments before offering training or job placement opportunities are more likely to achieve positive results. These assessments should identify vacancies, define priority sectors, and set expectations about wages.
2. Invest in partnerships with local employment agencies or other relevant institutions. Partnerships with employment services, chambers of commerce, and specialised organisations can reduce costs for employers and reintegration service providers while ensuring continuity of support. If partners lack the capacity to perform this role, programmes can provide additional capacity-building or technical support.
3. Build enabling systems rather than isolated employer partnerships. Sustained engagement requires institutional structures such as public-private coordination platforms, sector committees, transparent referral mechanisms, and labour standards that can be monitored. These systems create continuity beyond individual project cycles and make employer engagement more durable.

Ultimately, the evidence base is still developing, and many initiatives remain small relative to the scale of reintegration needs. However, experience from existing initiatives suggests that stronger links with employers and employment agencies will become increasingly important, particularly as donors and origin countries emphasise national ownership and pursue reintegration approaches that cannot rely on providing start-up grants at scale. In that context, building the institutional foundations for credible employment opportunities is a priority.

'Experience from existing initiatives suggests that stronger links with employers and employment agencies will become increasingly important'.