The search for self-reliance: refugees and the informal working poor

“Their labour is often all that refugees have to sell,” proclaimed Robert Chambers, a renowned refugee advocate and researcher. At the time, he was writing about refugees in rural sub-Saharan Africa in the 1970s. But his words continue to ring true around the world today.

An estimated two-thirds of the world’s refugees lived in poverty in 2023. Their situation has continued to deteriorate. Refugees in 2025 have experienced cuts to their food rations and other support, rising xenophobia and anti-migrant behaviours, and threats to their legal right to remain protected in exile. This is in part due to USAID and other donor cuts, as well as the rise of anti-migrant politicians in the US, Europe, and elsewhere.

A tragic yet paradoxical outcome of not just becoming a refugee but remaining one is that assistance (and often media attention and public goodwill) decreases over time. As humanitarian funding dries up, agencies often switch to encouraging so-called ‘development’ practices in the hopes of helping refugees better fend for themselves. A large pillar of such work is supporting refugees to join labour markets, be they semi-closed markets of camps, local urban economies, or even the global market through remote work.

My research documents how assistance to help refugees become ‘self-reliant’ (to live without humanitarian assistance) has changed over the last century. The first refugee livelihoods programmes, as we would call them today, were largely focused on agricultural subsistence in rural areas. But over the decades they have shifted to a primary focus on incorporating refugees into waged-based labour markets. In practice, this incorporation has largely taken place in the informal urban economies of host countries since the 1980s.

This history suggests that practitioners and policymakers are increasingly relying on the labour market – rather than legal protections, such as those found in the 1951 Refugee Convention – to provide long-term protection (and ostensibly dignity) for refugees. The public statements of international bodies confirm this assessment. As UNHCR, the UN Refugee Agency, states: “After fleeing war or persecution, one of the most effective ways people can rebuild their lives with dignity and in peace is through the opportunity to work and earn a living.”

But does the work that refugees undertake provide dignity? And what sort of protection can the capitalist system actually offer?

To continue with Chambers’ observations from the 1970s: refugees who have “self-settled” in rural areas (i.e. are living outside of camps and not in cities) “may be kept poor not just by their initial poverty, low wages, lack of work and lack of food, but also by petty persecution and lack of security”. This remains an accurate summary for millions of refugees living both in and outside of camps in 2025.

Refugees as a reserve army of labour

Capitalist economies have long drawn on the presence of vulnerable, impoverished populations for cheap and exploitable labour. In the 1800s, Karl Marx described an “industrial reserve army of labour” that can easily be employed in times of growth and swiftly cast aside when production slows.

This “army”, he wrote, is inherent to the successful working of capitalism. It provides the necessary labour for production and the internal competition to drive down wages. In Das Kapital, Marx writes: “…The greater this reserve army [is] in proportion to the active labour army, the greater is the mass of a consolidated surplus population, whose misery is in inverse ratio to the amount of torture it has to undergo in the form of labour.”

In other words, as the reserve army grows in number, wages sink further or stay low, and this population continues to be exploited through work. However, for most, exploitative work is still preferable to the utter destitution that exists without savings or a safety net.

Refugees comprise part of this reserve army in host economies, and efforts have been made to get them into active employment throughout the modern history of refugee assistance. Practitioners have tried to do this through public works programmes, vocational training, micro-finance loans, cash stipends, and agricultural support, among other programmes. In most contexts they have had some, albeit often-fleeting, successes. But both the challenges of poverty and the reality of precarity remain.

Even while working, refugees must often decide whether to eat enough or send their children to school

Why? Notably, the types of income generating activities that refugees are encouraged to undertake are generally not based on refugees’ own desires or existing skills. They are (primarily) dictated by the needs or allowances of host states or corporations. This leads to refugees' instrumentalisation as labourers for projects that are not their own, be they grand national development plans or the growth of cash-based economies.

Refugees are also generally not permanently active members of this army, as regular employees with benefits are. As reservists, they are more like shock absorbers for the economy. They provide more or cheaper labour power when and where the economy desires it, rather than based on any needs of their own. Even those working full-time in the informal market may not make regular profit, highlighting their precarious conditions.

Indeed, by Marx’s definition, many refugees are in fact members of the stagnant reserve army, a term he uses to describe workers in relation to capitalism: “a part of the active reserve army but with extremely irregular employment”. The stagnant reserve is marked by their low living conditions, irregular employment, and informal or part-time work that pays below average wages.

Even while working, refugees must often decide whether to eat enough or send their children to school. The work they undertake ranges from farming to sex work to IT support and more. But regardless of whether we take the pay, the type of work, or the outcomes (families still food insecure, still not enough money for healthcare) as our metric, this work can rarely be considered dignified. Protection and security remain out of reach for too many refugees.

Urban refugees and the search for self-reliance

In urban areas and camps alike, refugees generally must join the economy in order to survive. Urban refugees are generally not provided with food rations or support for housing, while refugees in camps or settlements must often supplement inadequate rations with additional income for basic necessities.

Refugees I interviewed in the Nakivale settlement in Uganda described food rations cuts while simultaneously dealing with worsening weather conditions for farming and few other viable livelihood opportunities. In Kampala, refugees selling goods informally on the street are chased by police for not having a business license – sold for a fee few of them could ever afford.

Indeed, livelihoods creation often comes into direct conflict with the legal restrictions of host countries. Millions of refugees lack the legal right to work, and despite refugees’ need to survive, host countries are generally loath to open up their usually very small formal labour markets to them. This confines most income generation to the informal market, making the livelihoods on offer far less secure, stable or dignified than is often assumed.

Taken most cynically, transitioning from aid to livelihoods training is little more than a cost-effective exit strategy

Self-employment is also often more difficult than practitioners like to pretend. The livelihoods trainings offered to refugees in many places provide them with some skills, but not with the start-up capital or access to markets that they need to create viable businesses. Many refugees I have met have spent six to 12 months participating in a livelihood training programme offered by an international humanitarian agency, only to then find themselves lacking the funds to buy the necessary material to start a business. As a result, they remain without work. While refugees may seem like they have the ability to become entrepreneurs (and often have the interest and determination to become successful), in reality they are often excluded from the resources that entrepreneurs in any context need to succeed.

Finally, both livelihoods and entrepreneurial trainings are too often misaligned with refugees’ skills or desires. This mismatch, combined with the lack of investment in follow-through to true livelihoods creation, represents at best negligence by organisations and at worst programming that has no expectation of impact. Taken most cynically, transitioning from aid to livelihoods training is little more than a cost-effective exit strategy – a way for international humanitarian and development agencies to reduce the costs of supporting protracted refugee situations. While important work is taking place to foster refugee self-reliance and promote the matching of skilled refugee workers and decent work, this must continue on a larger scale – and be complemented by wider work to address structural global inequality.

Protracted displacement and policies of containment

Refugees are not just members of countries’ stagnant reserve armies, but also the global stagnant reserve army – the unavoidable surplus population engendered by capitalism and fuelled by globalisation. In an increasingly transnational world, the global stagnant reserve army consists of members generally too poor, old, sick, or otherwise marginalised to pose a threat in the societies where they work as international migrants.

Living in slums and working haphazardly in the informal economy, many refugees enjoy no recourse to onward movement or social protection. They can be neither ‘welfare thieves’ nor competition in northern markets. This segment of vulnerabilised workers is contained politically and geographically by the poverty enforced upon them: earning enough to survive but not enough to meaningfully change their circumstances through mobility or other means. Poverty keeps them working – and in place.

In such contexts, any claim that the ‘market’ will offer refugees protection and dignity should be viewed with scepticism. Once ‘self-reliant’, it is far more common for refugees to simply become forgotten members of the informal working poor.

Stepping back, looking ahead

The nature of society is exposed at its margins. Understanding the reality of refugees struggling to generate livelihoods in truly dignified and sustainable ways leads to both an indictment and a way forward.

As an important starting point in refugee assistance, there is a need for truthful discourse about the limited protective capacity of capitalism at both the individual and global scale. Indeed, the thin ‘protection’ of the market was further exposed within the humanitarian and development sector this year when close to a quarter million jobs were lost globally as a result of US legislative orders to close USAID.

Now more than ever, it is clear that work as a source of safety – for healthcare, financial security, dignity, and more – is tenuous for many of us, and out of reach for most. Recognising and addressing the specific challenges that many refugee workers face also calls forth larger questions on human rights, labour protections, and global inequality. The experiences of refugees are one part of the much larger story of labour and capital.

As Chambers once wrote, there is a need for people involved in refugee assistance to “have eyes to see, and the will to act” on this knowledge.