Trapped in the underground economy: Syrian refugees in the informal labour market in Turkey

Abstract

By combining theories on informal work with data collected through interviews with 39 Syrian refugees, this article provides a comprehensive analysis of the various factors driving Syrians, both ordinary workers and employers, into the informal labour market in Turkey. The study shows the differences between the factors pushing Syrian workers into the informal sector (eg administrative obstacles, monetary and non-monetary benefits, unfamiliarity with labour regulations) and the reasons why Syrian business owners and self-employed worked informally (eg the desire to hire Syrian workers, inability to comply with labour regulations, and fear of deportation). By focusing on the reasons behind Syrian employers’ decisions to remain in the informal sector, the article shows that such decisions were often based not on profit-seeking but on solidarity with fellow Syrians.

Keywords:

• Syrian refugees
• Türkiye
• informal work
• reasons for informal employment
• migration governance

Introduction

Migration governance may adopt different approaches to either facilitate or prevent the incorporation of migrants into a host country’s informal labour market. When a host country’s authorities agree there is a need for new workers, migration governance can enable the integration of migrants, including refugees and asylum seekers, into the informal economy, thus providing businesses with a supply of precarious, under-paid labour (Turner 2015, 399). Migration governance can facilitate labour exploitation of informally employed migrants through processes of racialisation, securitisation, restrictive legal regimes, and practices supporting informal work (eg a weak monitoring system) (Eder 2015; Rajaram 2018; Jagarnathsingh and Nimer 2020). When, on the other hand, a host country’s authorities see no need to integrate migrants into the labour market, migration governance can rely on various mechanisms to prevent migrants from working (eg harsh penalties for workers and employers, deportations, and strict encampment policy hindering access to jobs) (Turner 2015, 399).

The integration of migrants into the informal labour market in contemporary neoliberal societies is based on the following premise: the inclusion of a cheap and docile migrant labour force into the informal sector goes hand in hand with the strengthening of social, political and legal barriers that aim to prevent migrants from becoming legitimate members of the host country (Kemp 2004, 268). This strategy of incorporating migrants into the informal economy while denying them social and political rights was adopted by Turkey during its transformation into a neoliberal state in the late 1980s and 1990s (Kirişci 2009; Eder 2015; İçduygu and Aksel 2015, 123). As Turkey adopted a new economic model, it simultaneously turned into a host country for migrants who provided a fresh supply of informally employed workers. Those migrants came from former socialist countries in Eastern Europe and the Soviet Union, as well as a number of Asian and African countries, and entered the informal economy to fill the need for workers in the manufacturing sector (eg textile, food industry), service sector, agriculture, construction, and tourism (Toksöz, Erdoğdu, and Kaşka 2012, 17–23). Employers hired migrants who were vulnerable (eg irregular status, permanent fear of deportation, exclusion from union organisations), and thus willing to work in precarious conditions (eg long working hours, no means to demand the promised salary from employers) for lower wages than locals (eg no overtime pay, no annual leave, no social security coverage) (Toksöz, Erdoğdu, and Kaşka 2012, 23).

The incorporation of migrants into the informal economy was facilitated by a flexible visa regime that allowed nationals from the former Soviet Union and Balkan countries, in particular migrants of Turkish ancestry, to enter Turkey either without visas or with visas easily obtained at entry points (Kirişci 2007, 93; Kirişci 2008, 3). The liberal visa policy made possible ‘shuttle’ or ‘circular migration’ – that is, short-term, repetitive movements of migrants between their homes and the host country – and, consequently, the inclusion of migrants into the informal sector (Kirişci 2008, 4–6). Given that the authorities often tolerated informal work, employers had free rein in tapping into the pool of migrant workers (Kirişci 2008, 8–9). Employers knew there was little chance of being fined for employing informal workers, so they regularly ignored the law and hired migrants without applying for work permits (Eder 2015, 143).

The evolution of Turkish migration governance, in particular how the capital–state nexus influenced migration governance to facilitate the inclusion of migrants into the informal economy, helps us understand the social, economic and political context established before the arrival of Syrian refugees in Turkey (Nimer and Rottmann 2021, 5). When Turkey became the host country with the largest number of Syrian refugees – about 3.6 million (UNHCR 2021) – after the war erupted in 2011, the Turkish authorities and business owners embraced the strategy of incorporating Syrians into the informal labour market to gain a new supply of precarious workers. While providing shelter to Syrian refugees, the Turkish authorities adopted two policies for regulating the integration of Syrians into the economy. The first policy, implemented between 2011 and 2016, was to refuse Syrian refugees access to the formal economy. The authorities thus created the conditions for the inclusion of hundreds of thousands of impoverished Syrians into the informal sector that provided them with no labour-related security (Bidinger 2015, 235; İçduygu and Diker 2017, 24).

The second policy, which finally allowed Syrian refugees to enter the formal sector, was implemented in 2016. In January 2016, the Turkish government adopted the Regulation on Work Permits of Foreigners under Temporary Protection (hereafter Regulation on Work Permits), the key document regulating the access of temporary protection beneficiaries, including Syrian refugees, to the formal labour market. The regulation allowed Syrians to apply for work permits that enabled them to work legally in Turkey. Work permit applications had to be lodged by employers on behalf of their Syrian workers or, in the case of self-employed Syrians, by Syrians themselves. However, despite the introduction of a policy that encouraged the economic integration of Syrian refugees, the vast majority of Syrians continued to work in the informal sector. In November 2018, the total number of work permits granted to temporary protection beneficiaries was only 32,199, which indicated that only a very small fraction of Syrian refugees entered the formal economy (Mülteciler Derneği 2019). Estimates of the number of Syrians working in the informal sector ranged from 500,000 to 1,000,000 (Kadkoy 2017, 2). Informally employed Syrian refugees, including children, continued to work in the garment industry, agriculture, construction, and service sector (eg grocery stores, catering facilities, cafes and restaurants) (Ayhan and Kıraç 2016, 28–29; NOAS 2018, 33).

The dominant view among scholars is that the Turkish authorities adopted a mode of migration governance that enabled the inclusion and exploitation of Syrian workers in the informal sector (Canefe 2016; Yalçın and Yalçın 2019; Yılmaz, Karatepe, and Tören 2019; Çınar 2019; Saraçoğlu and Bélanger 2019; Yılmaz 2019; Nimer and Rottmann 2021). While exploring how the Turkish authorities paved the way for the integration of Syrian refugees into the informal economy, scholars focused – firstly – on the legal regime governing Syrians’ access to the labour market. For example, research showed how the new regulation limited access to formal work and thus pushed Syrians into the informal economy (Canefe 2016), or how the regulation allowed Syrians to work informally in agriculture (Development Workshop 2016; Kavak 2016; Dedeoğlu and Bayraktar 2019; Dedeoğlu and Bayraktar 2020). Secondly, researchers examined various practices sustaining informal work, for example the unwillingness of employers to apply for work permits for Syrian workers (NOAS 2018, 32) and the Turkish state’s reluctance to monitor labour conditions and punish violations of labour law (Bélanger and Saraçoğlu 2020).

The studies exploring how informally employed Syrians were exploited by Turkish employers neglected the fact that many Syrians were self-employed or small business owners – and thus independent of Turkish employers – who chose to work in the informal sector. Between 2011 and 2017, Syrian refugees registered more than 6000 companies in Turkey, while the number of informal, unregistered Syrian businesses was estimated to be about 4000 (Building Markets 2017, 9).¹ Another study estimated that the approximately 10,000 companies established by Syrians employed on average 7.3 workers, 60% of whom were Syrians. According to this estimate, Syrian companies employed about 44,000 Syrians (Güven et al. 2018, 16). This indicated that Syrian refugees were not solely exploited workers, victims of the state–capital nexus, but also capital owners who relied on an informal labour force. It is true, as research convincingly showed, that the vast majority of Syrian refugees were ordinary workers, toiling in Turkish companies, but if we want to obtain a more complete picture of Syrian refugees in the Turkish informal labour market, we also need to explore the various reasons for informal work in Syrian-run companies and among Syrian self-employed workers.

Relying on theories about informal work and using new data collected through interviews with Syrian refugees and representatives of Syrian community organisations, this article aims to provide a comprehensive analysis of the reasons why Syrians entered the informal sector. The research, on the one hand, provides new knowledge on the factors driving Syrian workers into the informal labour market (eg administrative obstacles, monetary and non-monetary benefits, and unfamiliarity with labour regulations) and, on the other hand, offers original insights into previously under-researched reasons behind the decisions of Syrian business owners and self-employed persons to work informally (eg the desire to hire Syrian workers, inability to comply with labour regulations, and fear of deportation). By focusing on the reasons behind Syrian employers’ decisions to remain in the informal sector, the article shows that such decisions were often based not on profit-seeking but on solidarity with fellow Syrians.

Deconstructing the reasons behind informal work

In order to gain new knowledge on the factors driving the inclusion of Syrian refugees in the informal sector, it is worth combining recent studies on migration governance with theories on informal work. The theories on informal work can provide us with a solid conceptual framework for understanding the heterogeneity of the informal sector and the various reasons for the persistent presence of informal work, including the reasons for the inclusion of refugees into the informal sector (Gërxhani 2004; Portes and Haller 2010; Williams and Lansky 2013). Studies on migration governance can contribute to the theories on informal work by providing knowledge on how refugee status affects people seeking work in the informal sector. The theories on informal work were developed using data on citizens working in the informal sectors of specific countries, and are thus often blind to the particular situation of people with protection status.

Three theories on informal work are relevant to this study. The legalist theory, also called the neoliberal theory, argues that the emergence of the informal sector – for example, informal small businesses – is a popular reaction against a hostile legal system that excludes the urban poor from the formal economy (De Soto 1989, 2000; Neuwirth 2011). According to this theory, people with limited financial resources have no choice but to set up informal businesses to avoid the burdensome legal restrictions protecting the interests of a narrow elite, for example legal restrictions that increase labour costs (eg high taxes) and prevent flexibility in the formal sector (De Soto 1989; Becker 2004). This theory contends that the informal sector has no links to the formal economy. De Soto (1989, 14), for example, viewed informal businesses as an ‘alternative market’, thus suggesting that the informal sector was an unregulated entity separate from the formal economy. The legalist theory is useful for this study because it can help us better understand the legal barriers preventing Syrian business owners from entering the formal sector. Although this theory focuses on controls and restrictions regulating the procedures for running a company, we propose here to include among such legal barriers the restrictions linked to the refugee status of those seeking employment.

Unlike the legalist theory, the structuralist theory views informal work as closely interlinked with, and dependent on, the formal sector (Moser 1978; Portes and Schauffler 1993; Fernández-Kelly and Shefner 2006). This theory contends that the existence of the informal sector is the result of formal large-scale companies’ arrangements aimed at maximising production flexibility and reducing labour costs by violating labour law (Benería and Roldan 1987; Portes and Schauffler 1993). Such arrangements, for example, include subcontracting production to unregulated small-scale businesses that rely on the exploitation of an informally employed workforce (Moser 1978). It is, therefore, the modus operandi of large-scale companies that creates the conditions for the emergence of the informal sector. This theory is useful for our research because it can help us understand the rationale behind employers’ decision to hire Syrian workers to exploit them as an informal, cheap labour force.

A more recent theory, the voluntarist theory, argues that workers choose to operate in the informal economy after weighing the costs and benefits of the informal sector relative to the formal sector (Maloney 2004). According to this theory, many self-employed workers and employers – for example, owners of micro-enterprises – voluntarily transit into the informal sector due to the many monetary and non-monetary benefits this sector provides them (eg greater independence at work, higher remuneration, and the opportunity to better balance work and home responsibilities) (Maloney 2004; Williams and Renooy 2013). Given that this theory presupposes that workers are able to make free, voluntary decisions on whether or not to enter the informal sector, it may not be easily applicable to refugees whose decisions are significantly influenced by external factors (eg the struggle for survival, restrictive legal regimes), and, consequently, are not completely voluntary. However, this theory can still help us detect and understand why Syrian workers and employers in some situations decided to work informally, even though their decisions were limited by external factors.

Methodology

This qualitative study collected data through semi-structured interviews with 39 Syrian refugees – 30 males and nine females – who settled in Istanbul between 2011 and 2019. Moreover, interviews were conducted with representatives of one Turkish non-governmental humanitarian organisation and two Syrian community organisations providing assistance to Syrian refugees in Istanbul.²

The staff of the two Syrian community organisations helped me get in contact with Syrian refugees. The interviews with refugees took place on the premises of the two community organisations and the premises of Syrian-owned companies. All interviews were conducted in quiet, private locations. During the interviews with refugees, only the interviewee, the interpreter and I were present. The interviews were carried out in three neighbourhoods – Yedikule, Esenyurt and Fatih – in Istanbul in June and July 2019. All participants required an interpreter.

The participants were aged from 18 to 58. Most of them – 33 people – were temporary protection beneficiaries and four of them had a tourist visa, while two had no status. Out of the 39 interviewees, 34 worked in the informal labour market, while only five had a work permit and worked legally. The men worked in the garment and textile industry (six participants), grocery shops (six), pastry shops (six), mobile phone shops (two), perfume shops (two), wholesale coffee vendors (two), restaurants (two), a butcher shop (one), and a barbershop (one). In addition, one of the men was a street vendor, while another was a freelance photographer and video editor. Almost all of the women worked at home, sewing clothes (three) or making jewellery (two), toys (one) or cigarettes (one). Only two women did not work at home: one was a hairdresser, and the other was a babysitter.

Using conventional content analysis, the study examined the factors driving Syrian refugees into the informal economy. The analysis, which took place over a period of six months, included multiple readings and coding of the transcripts to develop a detailed insight into the participants’ perspectives.

The factors driving Syrian workers into the informal sector

Syrian workers, legal obstacles and informal work

Migration studies often cite legal barriers as one of the key factors preventing or hindering the inclusion of refugees into the formal economy, thus leaving refugees with no choice but to seek informal work (Zetter and Ruaudel 2016, 12–13). Such legal barriers may include restrictive criteria for obtaining work permits, high costs for work permits, the prohibition of employment in certain sectors, and limitations such as the prohibition of owning a business, owning immovable property, and limited access to credit (Zetter and Ruaudel 2016, 12-13).

The labour-related legal barriers Syrian refugees faced in Turkey can be divided into two categories. The first category consists of restrictions that prevented Syrians from having access to formal jobs. All of these restrictions were linked to the temporary protection status granted to Syrians. Firstly, the Regulation on Work Permits, which set the conditions under which Syrian refugees were allowed to enter the formal sector, had a provision stipulating that temporary protection beneficiaries were allowed to ‘lodge an application […] to obtain work permits six months after the date of their temporary protection registration’. Newly registered Syrians thus had to wait for six months to apply for work permits and work legally. This temporal limitation represented a problem for Syrians who arrived in Turkey with limited financial resources and needed to find a job quickly. Given that they were not allowed to enter the formal economy immediately, they had to look for informal work.

Secondly, another legal obstacle preventing Syrians from getting a work permit in Istanbul was that the local authorities refused to change the place of registration of Syrians who moved to Istanbul from other provinces. The law stipulated that Syrian refugees were allowed to work only in the province where they registered as temporary protection beneficiaries. If they moved to another province with a more dynamic labour market (eg industrial hubs such as Istanbul, Ankara and Izmir), they were not allowed to seek formal employment unless they changed their place of registration (Del Carpio, Seker, and Yener 2018, 11). It was, however, difficult to change the registration location due to a cumbersome and costly administrative procedure (Del Carpio, Seker, and Yener 2018, 11). The situation was even worse in Istanbul because the local authorities stopped allowing Syrians to change the registration location at all. A Syrian worker who moved to Istanbul after registering in Hatay province explained:

The problem is that I’m registered in Hatay. I asked to change the place of registration [in Istanbul], but I was rejected. My employer … he is my friend … he said that he was willing to provide me a work permit, but he can’t do it because I can’t change the place of registration. Now it’s not possible to change the place of registration. The Istanbul municipality decided that they have enough Syrian refugees and don’t want to take more. […] You can move to other places but not to Istanbul. (Interviewee 15)

In mid-2019, the Turkish authorities announced that Syrian refugees were not allowed to change their place of registration to Istanbul. The Istanbul Governor’s Office, which was under the authority of the Ministry of Interior, ordered all Syrians not registered in Istanbul to relocate to their province of registration or, if they were not yet registered, to move to other provinces to register (AI 2019, 9). Consequently, Syrians who wanted to stay in the city despite being unregistered or registered in another province could not apply for a work permit, which left them with no choice but to seek informal work.

Thirdly, the decision by the Turkish authorities to stop registering Syrian refugees in Istanbul created another legal obstacle for Syrians who had recently arrived in the city. Without a temporary protection status, the new arrivals could not get a work permit. Two interviewees – one of them arrived in Istanbul in 2018, while the other came in 2019 – confirmed they could not register as temporary protection beneficiaries because the authorities had stopped registering Syrian refugees in Istanbul. Both of them wanted to stay in Istanbul because they had friends in the city and better job opportunities. Without temporary protection status, however, they were unable to apply for a work permit and thus had to work in the informal sector.

The second category of legal barriers consisted of restrictive regulations in the workplace. One such legal obstacle was a provision stipulating that a work permit for Syrian workers was valid only at one workplace. When Syrian refugees received a work permit, they were allowed to work only for the company where they received it. Each time they changed an employer, they had to apply for a new work permit. Consequently, if workers frequently changed their jobs, applying for work permits became impractical and expensive. A Syrian worker explained:

I constantly change the place of work. So, I am not thinking about getting a work permit because then I would need to stay with the same employer. I change the companies too often. Sometimes I change the employer every four months. Since I’m here [in Turkey], I changed about 20 companies. Sometimes I just fill a gap when they need a worker, and I work for a company for a few weeks. (Interviewee 11)

It was difficult for Syrians with short-term jobs that lasted only a few weeks to ask employers to apply for work permits because they knew it was too expensive for the employers to get the permits for such short periods. Given that many Syrians could not find long-term work and had to accept short-term positions, continuously jumping from one employer to another (Caro 2020, 9–10), they had to work informally.

Syrian workers, employers and informal work

The structuralist school stresses that in capitalist societies the informal sector is often subordinated to the formal sector, with formal companies exploiting informal workers who are poorly paid and easily replaceable, and who have no bargaining power (Moser 1978; Fernández-Kelly and Shefner 2006). By exploiting an informal labour force, usually hired through informal subcontractors, formal large-scale companies create the conditions for the existence of the informal sector.

In the case of Syrian workers in Turkey, many business owners created the circumstances for the emergence of informal work by refusing to apply for work permits. Research evidence showed that one of the key reasons for the low number of work permits granted to Syrians was the unwillingness of employers to apply for permits on behalf of their Syrian employees (İçduygu and Diker 2017, 23; Tören 2018; NOAS 2018, 32). Although the Regulation on Work Permits stipulated that an application for a work permit had to be lodged by the employer, many employers refused to do so because, as the interviews confirmed, they wanted to avoid the costs of having formally employed workers. A Syrian worker said:

Syrian workers are very cheap for Turkish employers. If I asked an employer to provide me a work permit, he would tell me to go away. He would tell me that he will find another worker who will not ask for a work permit. […] Money is a big deal for Turkish employers. When it comes to money, they will do everything not to lose it. Even when a Dutch organisation [United Work, a non-governmental organisation providing assistance to Syrian refugees in Turkey] offered to pay for the work permit, the employers didn’t want to apply for the permit. (Interviewee 24)

Employers refused to apply for work permits because they wanted to avoid paying the fees for the permits. The fee was initially US$90 for a permit, but it was reduced to US$33 in December 2017 (Turkish Labor Law 2017). Moreover, employers wanted to avoid paying workers the minimum monthly wage set by the Turkish government. The Regulation on Work Permits stipulated that lawfully employed Syrian refugees must receive at least the minimum monthly salary, but employers chose to hire workers informally and paid them less than the national minimum. Research evidence showed that Syrian informal workers received wages well below the national minimum (Ayhan and Kıraç 2016, 29; Tören 2018, 41).

By exploiting informally employed Syrians, Turkish-run companies gained an advantage that enabled them to endure a domestic economic crisis and improve their position in a competitive global arena (Bélanger and Saraçoğlu 2020). Given that many Turkish companies (eg companies in the garment sector and agriculture) were subcontractors of transnational corporations, informally employed Syrians became a cheap labour force indirectly exploited by such corporations (Korkmaz 2019; Segal 2019).

Syrian workers, cost–benefit analysis and informal work

The voluntarist theory contends that workers choose informal work for both monetary (eg higher income generation, no tax payments) and non-monetary (eg flexible workday hours, increased independence, ‘community building’) reasons (Maloney 2004; Williams 2004, 26–27). This dichotomy between economic and non-economic motives for choosing informal work became apparent in the case of Syrian refugees.

The interviews conducted for this research revealed the following monetary and non-monetary reasons behind the decisions of Syrian workers to remain in the informal sector. Firstly, many Syrians did not want to apply for work permits because they did not want to lose humanitarian aid (eg cash and non-cash assistance) from governmental and non-governmental organisations (SEF 2018, 11–12). For example, the European Union funded the Emergency Social Safety Net (ESSN) programme, the largest cash transfer scheme in Turkey, which provided assistance to over 1.5 million of the most vulnerable refugees (WFP 2019). One of the conditions for obtaining cash assistance – about US$20 a month – was that the beneficiary had to be unemployed (WFP 2019). If the beneficiary started working with a valid work permit or opened a registered business in Turkey, he and all of his family members stopped receiving the cash assistance (WFP 2019). The same applied to most humanitarian aid and financial grants for Syrian refugees living in Turkey (SEF 2018, 12). As a result, some Syrians who benefitted from those grants preferred to work informally in order to have a source of income and, at the same time, retain humanitarian assistance (WFP 2019). A representative of a Turkish non-governmental organisation explained:

They [Syrian refugees] receive aid from abroad, from the EU. They receive 120 Liras for every family member. It’s not much. But if you have five infants at home, it covers your basic needs. If you register yourself as a legal worker, all family members lose that benefit. […] They have two choices – to try hard and find a formal job and lose the aid, or work informally and keep the aid.

Secondly, one Syrian employee I interviewed preferred to work informally to obtain the entire gross salary. In 2019, the minimum monthly gross wage was US$426 (Turkish Labor Law 2018). Employers had to deduct from that amount US$89 to pay for social security insurance, unemployment premium, income tax, and stamp tax (Turkish Labor Law 2018). Therefore, a formally employed worker with a work permit received a net salary of US$337 (Turkish Labor Law 2018). As one Syrian worker explained, he preferred to receive the gross salary instead of the net amount.

If a worker has a work permit, he has to give part of his salary for the sigorta [health insurance]. What is left for the worker? Nothing. […] Any employer will tell you that you have to pay for the work permit and the sigorta. If you pay for that, there is nothing left for you. (Interviewee 30)

The rationale was that it was better to be informally employed to avoid paying for benefits and taxes, and thus receive a higher salary. The interviewee explained that Syrians with temporary protection status had free-of-charge access to health services, so it did not make sense for them to see part of their gross salary deducted to pay for health insurance. If they worked informally, they were able to keep that part of the salary.

Thirdly, a few Syrian women, all of them employees, explained they preferred to stay informally employed because it allowed them to better balance their time between work and maternal responsibilities. Three women with young children – Interviewees 5, 6 and 9 –worked informally at home because they had to take care of their children at the same time. For example, Interviewee 5 said she ‘never tried to find a real job because I have to stay at home to take care of the children. I only work at home if someone brings me the materials needed to do the work’. In these cases, a patriarchal cultural norm – that is, that women must stay at home taking care of the children – pushed women into informal, low-paid work.³

Syrian workers not familiar with the regulation

One of the reasons behind informal work – that is, not being familiar with the regulation on work permits – seems not to fit into any of the above theories. A few Syrian refugees – four women working at home and a man working in a garment factory – were unfamiliar with the regulation governing access to the formal labour market. Two women – Interviewees 2 and 10 – claimed they did not need a work permit to work legally in Turkey. One woman – Interviewee 8 – was convinced that it was only possible to obtain a work permit if you had Turkish citizenship. The man working in a garment factory – Interviewee 18 – believed that the Turkish authorities would not allow him to go back to Syria for short visits during holidays if he had a work permit. Therefore, he did not ask his employer to apply for a work permit.

Also, one of the women – Interviewee 9 – said that she did not understand what was needed to obtain a work permit due to the language barrier. ‘I never asked for a work permit’, she said. ‘My command of the Turkish language is so weak that I was never able to ask. I don’t know what I have to do to get a work permit’.

The factors driving Syrian employers into the informal sector

Syrian employers, legal obstacles and informal work

Drawing on the legalist theory, we can argue that burdensome controls and restrictions (eg legislation related to labour conditions, quality regulations and high taxes) often create insurmountable obstacles for the most marginalised strata of society to enter the formal sector, thus leaving them with no option but to join the informal labour market (De Soto 1989; Johnson et al. 1997; Johnson, Kaufmann, and Zoido-Lobaton 1998). The legalist theory primarily focuses on controls and restrictions regulating the procedures – and costs – of setting up and running a company, which prevent potential business owners from entering the formal sector.

In the case of Syrian refugees in Turkey, such restrictions – firstly – included regulations determining the costs of doing business in Turkey, in particular the cost to register a company, and salaries. With minimal capital at their disposal, many Syrian micro-entrepreneurs decided to work informally because they could not afford to obtain a licence for their companies – the cost of licensing was approximately US$1000 – and pay taxes (SEF 2018, 11). Moreover, many Syrian business owners opted for informal work because they did not have enough revenue to pay their workers the minimum monthly wage set by the Turkish government (Turkish Labor Law 2018). The Regulation on Work Permits stipulated that employers had to pay at least the minimum monthly wage to formally employed workers. Without revenue to meet that requirement, many Syrian employers decided to have Syrians work for them informally, and thus avoided paying the minimum monthly wage. As one Syrian employer explained: ‘I pay my workers about 1000 to 1500 Liras [about US$167–250] per month. I didn’t apply for work permits for them because it’s expensive for them and expensive for me’ (Interviewee 36).

Similarly, self-employed Syrian refugees with low revenues were unable to register their businesses and pay themselves the minimum monthly wage. One of the Syrians who worked as a freelance photographer and video editor explained:

If I open a company, I would need to pay taxes regularly, even when I have no work. I am still in the starting phase [of being a freelancer]. Most of the people who are in the starting phase they prefer to work [informally] for themselves and earn money. And if things go well and the business grows, yeah, then you can open a company. […] As far as I understand, the amount of money that I should pay [for opening a company] is quite high and more than what I am currently earning. (Interviewee 1)

Both self-employed Syrians and Syrian micro-entrepreneurs who did not have enough funds to lawfully run companies opted to set up informal businesses. They refused to lodge applications for work permits and thus remained part of the informal economy.

Another legal obstacle that drove Syrian businesses into the informal economy was the limited number of Syrian workers that employers were allowed to have at one workplace. The Regulation on Work Permits, Article 8, stipulated that the number of temporary protection beneficiaries working in a company had to be no more than 10% of the number of Turkish citizens working at the same workplace. In addition, if the total number of workers in a small company was fewer than 10, employers were allowed to hire only one foreigner under temporary protection, while all the other workers had to be Turkish citizens. Those rules were a problem for Syrian business owners who wanted to hire exclusively Syrians. Syrian employers often refused to apply for work permits for their Syrian workers because they did not want the authorities to know how many Syrians were working at their companies. All Syrian employers interviewed for this research had small, usually family-run, businesses where they employed only Syrians. The employees were family members, relatives, friends, and acquaintances of the employers, which indicated they were hired because the employers trusted them and wanted to provide work to members of their community. For example, Interviewee 16, the manager of a small Syrian-owned pastry shop that employed only Syrians, confirmed that the ‘problem is that you have to employ some Turkish workers if you want to have one Syrian worker’. As a result, none of the Syrians working at the pastry shop had a work permit.

Moreover, Interviewee 21, a Syrian owner of a small grocery shop that employed only Syrians, explained that it would be too expensive to formally employ a few Turkish workers to gain permission to have one Syrian worker:

It’s not possible to get a work permit for Syrians because we need to employ many Turkish workers for each Syrian worker. We would have to pay each Turkish worker the minimum wage – that is 2500 Liras [about US$416] per month. This is too expensive for us.

Consequently, Syrian employers who hired only Syrian workers chose not to apply for work permits. If they applied for work permits, they would reveal to the authorities that they were hiring Syrian workers in contravention of the Regulation on Work Permits.

Syrian employers, fear of deportation and informal work

According to De Genova (2002, 2005), the law generates and sustains the possibility of deportation, which makes migrant workers a disposable labour force. In addition to the law, an anti-refugee political discourse within a host country can also increase the fear of deportation among the refugee community. The fear of being deported can lead refugees, including business owners, to join the informal economy, mostly because informality gives them more flexibility and lower costs. Thus, it is easier for them to leave the host country if forced to do so. Due to the possibility of deportation, some Syrian business owners decided it was a waste of time and money to register their companies and apply for work permits (SEF 2018, 11). Two Syrian employers I interviewed said they did not apply for work permits because they feared they would soon have to leave Turkey. One of them said:

After the election, we feel a lot of pressure. People started to like us less. With the new mayor, we might close [our shop] at any moment. We might find ourselves in harsh conditions. This is keeping us back. We cannot move forward. With the AKP [Justice and Development Party], it was easier for us. Now, with the new mayor, we feel pressure. They [labour inspectors] are going around and checking licences. They can fine us. This is a big change for us. (Interviewee 39)⁴

Moreover, the fear of deportability also affected Syrian workers. Due to the uncertain situation in Turkey, one Syrian worker said he did not want to apply for a work permit because he did not intend to stay in the country. He was planning to move to Europe, so he thought it was a waste of time to get a work permit. He said:

I don’t have a work permit. I didn’t ask for one. It’s up to us to decide whether we want one. I don’t want it because I don’t plan to stay here. I want to return to Europe [He lived in Germany for about a year before being deported back to Turkey]. (Interviewee 13)

Tacit support for informal work

It is important to note that an additional key factor behind the widespread practice of informal work was that the Turkish authorities rarely conducted workplace inspections, so employers knew they did not risk much by hiring Syrians without work permits (Danış and Nazlı 2019). Almost all interviewees said they never had problems with labour inspections because inspectors never visited their workplaces. A non-governmental organisation official from Kadiköy said that government officials confirmed to him that the state was ‘not putting this kind of pressure [labour inspections] on employers’ because of the difficult economic situation in the country. Although government officials knew companies were hiring Syrian refugees illegally, they decided not to enforce the regulation.

When inspections were carried out at factories, it was easy for employers to hide informally employed Syrians. A Syrian worker said:

Inspectors came two times to check the factory where I worked. We had to hide to avoid a fine. The owner told me to go out through the back door. He told me that he would call me to come back after the inspectors were gone. (Interviewee 16)

To avoid such labour inspections, the Syrian community in Fatih neighbourhood relied on a ‘warning system’. A Syrian business owner explained that most of the Syrian businesses in that neighbourhood were connected through an app, which enabled them to inform each other about the presence of labour inspectors. When a labour inspector visited a Syrian company, the owner of that company sent a message to the other Syrian businesses, thus helping them to avoid the inspection by briefly closing their shops.

Moreover, when Syrian refugees were caught working without a work permit, labour inspectors sometimes ignored this kind of labour law violation. Interviewee 32, a Syrian refugee who owned a perfume shop, recalled:

They [labour inspectors] once came to check our papers. The company is registered. The company is legal. The workers still have no work permits, but they [labour inspectors] didn’t create problems for us. We told them that we are in the process of getting the work permits. They wrote a note, and I’m sure they will come back to check our papers again.

Even when the local authorities found unregistered Syrian refugees working without work permits, they adopted a lax approach. One of the interviewed Syrians was not registered as a temporary protection beneficiary and, consequently, did not have a work permit. Although he worked as a street vendor, and thus frequently came into contact with the police, he said the officers were kind to him: ‘The police came here and asked me about my papers. When they saw I have no papers, they took it easy on me. […] They just told me to go and register and get a kimlik [temporary protection identification document]’ (Interviewee 28). Although labour inspectors and the police often showed a high degree of tolerance towards informally working Syrians, the new, stricter migration policy adopted by the Turkish government after the 2019 local elections indicated that the authorities might adopt a tougher stance in the future (AI 2019).

Conclusion

This research shed new light on the complexity of factors behind informal work in the case of the Syrian refugee community, which was composed, as we have seen above, of people engaged in informal work of various types and for diverse reasons (Table 1).

Table 1. Summary of factors driving Syrians into the informal labour market.

Actors	Factors behind informal work
Turkish authorities	Legal obstacles: Having to wait six months after registration Not possible to change the place of registration Not possible to register in the desired location Work permits valid only at one workplace
Employers	Unwilling to apply for work permits in order to lower labour costs
Syrian workers	Want to retain humanitarian aid Prefer to receive a gross salary Easier to balance home responsibilities and work Unfamiliarity with the labour regulation (eg language barrier)
Syrian employers	Too costly to set up and run a formal business Want to hire fellow Syrians Fear of deportation

Previous research on Syrian refugees working in the Turkish informal economy mainly viewed informal work as a form of exploitative employment of precarious workers subjected to unscrupulous employers who were unwilling to apply for work permits for their Syrian workers. Those studies convincingly demonstrated that most Syrians were victims of restrictive measures and unlawful practices (eg unwillingness to apply for work permits, avoiding labour inspections, not registering companies) used to create a docile and cheap labour force needed to extract more surplus value.

Although the restrictive legal regime and unlawful practices played a key role in pushing Syrian refugees into informal work, it is also important to explore how some Syrians made their own decisions on whether or not to enter the informal sector, either as ordinary workers or as capital owners who opened informal businesses. In such cases, the emergence of informal work was caused by Syrians who decided to work informally based on a number of reasons. In the case of ordinary workers, employers were not the reason behind informal work when workers decided to enter the informal sector because it provided them with greater monetary benefits. For example, Syrian workers decided to work informally if they calculated that they would increase their revenue, by continuing to receive humanitarian aid and/or receiving the gross (rather than the net) salary. Moreover, in the case of Syrian women, the decision to work informally was influenced by a patriarchal cultural norm that views women as responsible for domestic work. Such decisions were also the consequence of structural factors such as the lack of childcare and the long working hours of their husbands. In these cases, the primary reason for the emergence of informal work was not the employers but the decision by Syrian women to work informally because it provided them more flexibility in balancing work and homecare responsibilities.

In the case of Syrian business owners, it became evident that some of them set up informal businesses because they were unable to comply with the labour regulations or because they feared being deported soon. Another reason was solidarity with fellow Syrians. The data indicated that Syrian employers hired fellow Syrians to provide work for their relatives, friends, and community members. This kind of informal economy based on solidarity included not only small businesses but also informal health centres (Danış and Nazlı 2019, 9), schools (HRW 2015) and community organisations (Sahin Mencutek 2021) for Syrian refugees. Given that the objective of such informal businesses and institutions was not only profit-making but also supporting members of the Syrian community, we cannot easily place them within the market-centred conceptualisation of informal work.

The various reasons for entering the informal sector show there are some differences and similarities in how different groups – that is, ordinary Syrian workers, entrepreneurs, and self-employed persons – experienced informality. Syrian workers often saw the informal sector as an option that enabled them to marginally increase their earnings or to better balance work with home responsibilities, whilst Syrian business owners and self-employed Syrians perceived the informal sector as a solution to set up their businesses and minimise the risks in running them. Although all groups were affected by the legal obstacles limiting access to the formal sector, different legal provisions affected these groups in different ways. On the one hand, Syrian workers were affected by the rules on the registration of refugees, the changing of registration location, the time frame for applying for a work permit, and the validity of the work permits. On the other hand, Syrian business owners and the self-employed were mostly affected by the rules governing the establishment of companies. In addition, those Syrian business owners who wanted to hire Syrians were affected by the rule limiting the number of Syrians at workplaces.

All the factors behind informal work indicated that refugees were not always passive victims of employers but also individuals making choices about entering the informal market based on monetary and non-monetary reasons. However, it must be clear that such decisions were also heavily influenced by external structural factors (eg the struggle for survival, the restrictive legal regime, and the widespread presence of informal work), and, therefore, not truly voluntary. A voluntary decision can only be made if an individual is in a position to freely decide among different options. Syrian refugees were not in such a privileged position as they were able to make decisions only within the very limited parameters set by the Turkish state and capital owners. We need to be aware of the particular situation of Syrian refugees to avoid creating a misleading impression that they were able to make truly voluntary choices. The voluntarist theory, which emphasises the voluntary nature of the decision to join the informal labour market, ultimately falls short of explaining the structural factors affecting such decisions. Therefore, more research is needed on how such decisions are influenced by those external factors.

Disclosure statement

There is no potential conflict of interest.

Additional information

Funding

This work was supported by the Slovenian Research Agency under grant no. P5-0221 B (research core funding) and grant no. J5-2565 B (Preventive (in)justice: The prevention of crime and social harms).

Notes on contributors

Vasja Badalič

Vasja Badalič is Senior Researcher at the Institute of Criminology at the Faculty of Law in Ljubljana, Slovenia. His primary fields of research are contemporary imperialism and migration. He has published many peer-reviewed articles in academic journals and monographs, including in Drones & Unmanned Aerial Systems (Springer, 2016) and Automating Crime Prevention, Surveillance, and Military Operations (Springer, 2021). He is the author of the book The War Against Civilians: Victims of the ‘War on Terror’ in Afghanistan and Pakistan (Palgrave Macmillan, 2019).

Notes

1 Syrian refugees who set up unregistered businesses usually worked as street vendors or in electronics shops, grocery stores, handicrafts stores, restaurants, hairdressing salons, and bakeries (ICG 2018, 17; SEF 2018, 10).

2 The collected data is available in Badalič (2021). The ethics approval for the research was given by the Institute of Criminology at the Faculty of Law in Ljubljana.

3 For an excellent analysis of the integration of Syrian women into the Turkish labour market, see Williams et al. (2020).

4 After the 2019 local elections in Turkey, the fear that the Turkish authorities would start putting pressure on Syrians to repatriate became more pronounced. During the campaign for the Istanbul mayoral election, the opposition candidate, Ekrem Imamoğlu, promised a tougher position on Syrian refugees living in the city. In the midst of a recession, with soaring unemployment and inflation, Imamoğlu, who believed that a lower number of Syrian refugees would benefit Turkish citizens, argued that Syrians living in Istanbul must return to their country of origin (Yurdakul 2019). After Imamoğlu won the election, many Syrians feared they would be forced to leave the city. After suffering defeat in the mayoral election in Istanbul, it was, however, President Erdoğan’s ruling party, the Justice and Development Party, that implemented a tougher policy on Syrian refugees, which included the forcible repatriation of Syrians from Istanbul and other Turkish cities to northern Syria (HRW 2019; AI 2019).