There are five major groups of classic ‘labour migrants’ in Germany: Greeks, Italians, (ex-)Yugoslavs, Turks, and Iberians, with the Turks being the largest single group. Today, there are significant numbers of second-generation men and women from these origins in the German labour market. More recently, they have been joined by a more diverse group of migrants from Western Europe, Eastern Europe, the (middle) East, and Africa. In the first generation, the labour-migrant groups had relatively low levels of education, leading to marked ethnic stratification within the labour market. This stratification continues in the second generation although on a reduced scale. While the second generation has acquired higher levels of education than the first, they still lag some way (the Turks especially so) behind native Germans in their education. Ethnic penalties in the labour market itself are also much reduced in the second generation, although significant penalties remain for Turks. However, most of the continuing ethnic stratification is due to processes that operate prior to entry into the labour market.