Immigration, Jobs, and Employment Protection: Evidence From Europe Before and During the Great Recession

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. n this paper we analyze the impact of immigrants on the type and quantity of native jobs. We use data on fifteen Western European countries during the 1996-2010 period. We find that immigrants, by taking manual-routine type of occupations pushed natives towards more "complex" (abstract and communication) jobs. Such positive reallocation occurred while the total number of jobs held by natives was unaffected. This job upgrade was associated in the short run to a 0.6% increase in native wages for a doubling of the immigrants' share. These results are robust to the use of two alternative IV strategies based on past settlement of immigrants across European countries measured alternatively with Census or Labor Force data. The job upgrade slowed, but did not come to a halt, during the Great Recession. We also document the labor market flows behind it: the complexity of jobs offered to new native hires was higher relative to the complexity of lost jobs. Finally, we find evidence that such reallocation was significantly larger in countries with more flexible labor laws and that his tendency was particularly strong for less educated workers. Giovanni Peri (University of California, Davis and NBER) * Terms of use: Documents in May, 2012AbstractIn this paper we analyze the impact of immigrants on the type and quantity of native jobs. We use data on fifteen Western European countries during the 1996-2010 period.We find that immigrants, by taking manual-routine type of occupations pushed natives towards more "complex" (abstract and communication) jobs. Such positive reallocation occurred while the total number of jobs held by natives was unaffected. This job upgrade was associated in the short run to a 0.6% increase in native wages for a doubling of the immigrants' share. These results are robust to the use of two alternative IV strategies based on past settlement of immigrants across European countries measured alternatively with Census or Labor Force data. The job upgrade slowed, but did not come to a halt, during the Great Recession. We also document the labor market flows behind it:the complexity of jobs offered to new native hires was higher relative to the complexity of lost jobs. Finally, we find evidence that such reallocation was significantly larger in countries with more flexible labor laws and that his tendency was particularly strong for less educated workers.JEL Classification Codes: J24, J31, J61.

Do immigrant workers depress the wages of native workers?

“…When immigrants fill lower-skill, manual-intensive positions, native workers move into more complex, cognitive-and communication-intensive jobs [2], [10]. Similarly, when highly educated immigrants enter the labor market and take analytically intensive positions in science and technology, highly educated native workers move into managerial occupations.…”

Do immigrants improve the health of native workers?

“…A number of recent studies suggest that this adjustment process may improve the job quality of native workers and have non-negligible effects on individual health and well-being [4], [5]. There is also evidence that immigration pushes native workers toward more communication-intensive jobs and reduces the physical burden associated with certain occupations ( Figure 1; Figure 2) [1], [2], [3], [4]. Furthermore, immigration decreases the likelihood of native workers working late hours and non-standard shifts [4], [6], [7].…”

“…It is worth noting that current studies focus on occupational risk and job types, rather than on the condition of jobs themselves. There is also evidence that immigration reduces the average workload of native workers and pushes them toward more "communication-intensive" jobs and more standard schedules [1], [2], [3], [4], [6], [7].…”

Nordic Economic Policy Review

“…In this article, we focus on research literature that has investigated this wage structure mechanism through which immigration may affect the resident population's formal educational attainment (Jackson, 2011;Hunt, 2012;, as well as its occupational specialisation (Peri and Sparber, 2009;D'Amuri and Peri, 2012).…”

“…The starting point for this research literature (Peri and Sparber, 2009;D'Amuri and Peri, 2012) is that natives, compared to immigrants, may have a comparative advantage for work that requires knowledge of country-specific skills. This typically concerns jobs that require a relatively high level of communicative skills.…”