Does Neighbourhood Ethnic Concentration in Early Life Affect Subsequent Labour Market Outcomes? A Study across Ethnic Groups in England and Wales

Abstract

The impact of neighbourhood ethnic concentration on ethnic minorities' outcomes is a contested topic, with mixed empirical results. In this paper, we use a large-scale longitudinal dataset of England and Wales, covering a 40-year period, to assess the impact of neighbourhood co-ethnic concentration in childhood on subsequent adult labour market outcomes. We distinguish the five main minority groups in the UK and develop theoretical expectations about how social interaction mechanisms in the neighbourhood might influence their employment and social class outcomes, given different group (cultural values and ethnic capital) and individual (gender) characteristics. By separating in time explanatory and outcome variables and by controlling for factors that mediate or confound co-ethnic concentrationsuch as neighbourhood deprivation, household resources in childhood (i.e. parental social class), and individuals' own educationour analytical model tackles potential problems of selfselection and endogeneity. Among other findings, we show that greater concentration of co-ethnics in the neighbourhood results in substantially lower labour market participation and lower social class for Pakistani and Bangladeshi women but better social class outcomes for Indian men. We link the outcomes for Pakistani and Bangladeshi women to cultural maintenance of more traditional norms, facilitated by greater social interaction. The results for Indian men, instead, suggest the positive role that high levels of group resources or 'ethnic capital' can play. Our study is, we believe, the first to demonstrate a role for coethnic concentration in childhood in explaining Pakistani and Bangladeshi women's low labour market participation and Indian men's labour market success.

Minority Embeddedness and Economic Integration: Is Diversity or Homogeneity Associated with Better Employment Outcomes?

“…In contrast concerns about ethnic embeddedness appear not to be wholly without foundation. This is in line with recent research by Zuccotti and Platt (2016) who, using linked census data, show that growing up in areas of high minority embeddedness leads to lower levels of economic activity subsequently. They interpret this as due to the preservation of traditional gender norms and roles in homogeneous minority communities.…”

Residential segregation and the fertility of immigrants and their descendants

“…These issues are avoided by investigating community population composition during childhood, prior to the commencement of childbearing. As argued by Zuccotti and Platt (), this approach is beneficial because it minimises the number of competing explanations, not least those due to selection.…”

Ethnicity and neighbourhood attainment in England and Wales: A study of second generations' spatial integration

“…The negative effects of neighbourhood deprivation on a series of outcomes, such as employment (Feng, Flowerdew, & Feng, ) or mortality and health (Boyle, Norman, & Rees, ), are well‐known. Moreover, although the effect of ethnic concentration is more complex to assess and depends greatly on the outcomes studied, research in the United Kingdom shows for example negative effects on Pakistanis and Bangladeshis' labour market outcomes (Clark & Drinkwater, ; Khattab, Johnston, Sirkeci, & Modood, ; Zuccotti & Platt, ).…”