The labour market impact and performance of immigrants

• Main Author: Glitz, Albrecht
• Published: University College London (University of London) 2008
• Subjects: 331
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.498586

In many countries, the extent to which immigration affects the labour market of the host economy is one of the key concerns in the public debate on immigration policies. Chapter 2 of this thesis provides a thorough review of the economic literature on the labour market impact of immigration and summarises the current empirical evidence. Chapter 3 investigates the impact of immigrants on the German labour market during the 1990s. This analysis takes advantage of a natural experiment in which a particular group of immigrants was exogenously allocated to specific regions across the country by the government. The empirical analysis focuses on the effect of these exogenous inflows on relative skill-specific employment and wage rates of the resident population. Chapter 4 of the thesis investigates how industries and firms respond to a change in the skill mix of local labour supply induced by an inflow of immigrants. One way to absorb these changes is an expansion in size of those industries and firms that use the corresponding skill group most intensively. Alternatively, in dustries and firms can adjust their production process and switch to a technology that uses the corresponding skill group more intensively. Based on German micro data, the analysis assesses which of these channels is dominant and quantifies their relative contributions. One of the key assumptions in many impact analyses is that natives and immigrants of the same observable skill level are perfect substitutes in the labour market and are thus equally affected by aggregate economic shocks. Chapter 5 of the thesis tests this assumption by analysing the way different immigrant groups in Germany and the UK respond to the economic cycle relative to comparable native workers.