The project aims to enhance our understanding of the socio-economic trajectories of people with a migration background, by focusing on three interconnected domains (work packages): the individual, the household and the firm. An extensive international body of research studies the labour market outcomes of people with a migration background, producing inconclusive views on why people with a migration background fare worse than their native counterparts. Human capital theory in a migration context claims that increased demand for a highly-educated workforce has raised the education premium and punishes the less skilled more severely (Katz and Autor, 1999; Baldwin and Beckstead, 2003). Authors find that first generation migrants are often endowed with lower levels and different kinds of human capital than those necessary to fare successfully in western labour markets (Heath and Cheung, 2007). An alternative stream of literature emphasizes the occurrence of different degrees of success in the labour market integration of newcomers (Neels, 2001; Euwals et al. 2007; Baert and Cockx, 2013). The human capital thesis is challenged by segmented assimilation theories rejecting that first generation migrants' disadvantages may weaken over time. Segmented assimilation theories indeed are less optimistic about the potential of education and other factors in explaining first generation migrants' weak labour market position. While some groups have an abundance of opportunities, others face multiple disadvantages, including insufficient social resources and discriminatory processes. There is increasing evidence that many first generation migrants face persistent labour market barriers that threaten their full integration (Fuller, 2011 ). Another factor that negatively affects first generation migrants' investment in the native labour market is the prevalence of discrimination. Even after controlling for human capital and after adjusting for host country characteristics, first generation migrants are often still disadvantaged. A potential, but again only partial, explanation is that first generation migrants face some form of discrimination in the labour market, either directly (Kalleberg and Soresen, 1979) or indirectly (Heath and Cheung, 2007). But the fact that people with a migration background have a harder time getting hired, just as young natives and older employees, does not necessarily directly point to discrimination. Literature equally points to rigidities in the labour market that make it harder for outsiders to find their way in. Strict employment protection makes hiring and firing decisions costly, which reduces the chance of 'risky' hires, such as people with a migration background whose human and cultural capital is much harder to gauge (Kogan, 2006).