Offshoring, Automation, Low-Skilled Immigration, and Labor Market Polarization

2022 ◽  
Vol 14 (1) ◽  
pp. 355-389
Author(s):  
Federico S. Mandelman ◽  
Andrei Zlate
Keyword(s):  
Labor Market ◽  
Structural Model ◽  
Employment Growth ◽  
Native Workers ◽  
Skilled Immigration

We show that the observed polarization of employment toward the high- and low-skill occupations disappears when only native workers are considered. Instead, low-skilled immigration explains employment growth at the low tail of the skill distribution. Moreover, while employment rose, wages remained subdued in low-skill occupations. A data-disciplined structural model accounts for this evidence: Offshoring and automation negatively affect middle-skill occupations but enhance employment and wages for the high-skilled. Low-skill employment is sheltered from offshoring and automation, as it consists of manual, non-tradable services. However, low-skilled immigration depresses low-skill wages and encourages native workers to move into skilled occupations through training. (JEL F16, J24, J31, J61, M53)

scholarly journals Examining the Impact of Legal Arizona Worker Act on Native Female Labor Supply in the United States

2020 ◽  
Vol 10 (1) ◽  
Author(s):  
Christian Gunadi
Keyword(s):  
Labor Market ◽  
Labor Supply ◽  
The United States ◽  
Women's Labor ◽  
Women's Participation ◽  
Native Workers ◽  
Skilled Immigration ◽  
Skilled Immigrant ◽  
The Cost ◽  
The Impact

AbstractLow-skilled immigration has been argued to lower the price of services that are close substitutes for household production, reducing barriers for women to enter the labor market. Therefore, policies that reduce the number of low-skilled immigrants who work predominantly in low-skilled service occupations may have an unintended consequence of lowering women’s participation in the labor market. This article examines the labor supply impact of the Legal Arizona Workers Act (LAWA), which led to a large decline in the low-skilled immigrant workforce of the state. The analysis shows no evidence that LAWA statistically significantly affected US-born women’s labor supply in Arizona. This finding is partly explained by an increase in native workers in household service occupations due to LAWA, which offset the decline in immigrants in these occupations and caused the cost of household services to be relatively uninfluenced by the passage of LAWA.

scholarly journals Macroeconomic Long-Run Effects of the German Minimum Wage when Labor Markets are Frictional

2020 ◽  
Vol 240 (2-3) ◽  
pp. 351-386 ◽  
Author(s):  
Helge Braun ◽  
Roland Döhrn ◽  
Michael Krause ◽  
Martin Micheli ◽  
Torsten Schmidt
Keyword(s):  
Labor Market ◽  
Minimum Wage ◽  
Structural Model ◽  
Economic Effects ◽  
Relative Price ◽  
Wage Policy ◽  
Market Outcomes ◽  
Long Run ◽  
Search And Matching Frictions ◽  
Negative Effect

AbstractThis paper analyzes the introduction of the German minimum wage in 2015 in a structural model geared to quantitatively assess its long-run economic effects. We first employ a simple neoclassic model where wages equal their marginal product, then extend this model to two sector economy, and finally introduce search and matching frictions. Even though all model variants remain highly stylized, they yield quantitative insights on the importance of different mechanisms and channels through which minimum wages affect outcomes in the long run. In this framework, the minimum wage has a strong negative effect on employment. When sectors are differently affected by the minimum wage, sectoral relative price changes play an important quantitative role. Other labor market policies and institutions are important for the transmission of minimum wage policy on labor market market outcomes.

High skilled immigration and the occupational choices of native workers: the case of Australia

2020 ◽  
Vol 72 (3) ◽  
pp. 585-605
Author(s):  
By Daniel Crown ◽  
Alessandra Faggian ◽  
Jonathan Corcoran
Keyword(s):  
Household Income ◽  
Cognitive Skills ◽  
Longitudinal Survey ◽  
Temporary Work ◽  
Negative Effects ◽  
Combine Data ◽  
Native Workers ◽  
Skilled Immigration ◽  
Nationally Representative ◽  
Full Population

Abstract This paper estimates the effect of a major skilled visa programme in Australia on the wages and occupation-specific skills performed by native workers. We combine data from the full population of approved Temporary Work Visa applications with the nationally representative Household, Income and Labour Dynamics in Australia (HILDA) longitudinal survey from 2005–2015. Our findings indicate that skilled international workers increase the wages of natives, and induce native workers to specialize in occupations associated with a high intensity of communication and cognitive skills. We find no evidence of negative effects of the visa programme on the wages of high-skilled or low-skilled native workers, or on previous migrants who may be close substitutes to the skilled visa holders.

scholarly journals The Determinants of Immigrant Self-Employment in Australia

2000 ◽  
Vol 34 (1) ◽  
pp. 183-214 ◽  
Author(s):  
Anh T. Le
Keyword(s):  
Labor Market ◽  
Cross Section ◽  
Employment Growth ◽  
Cohort Effect ◽  
Employment Outcomes ◽  
Foreign Born ◽  
Self Employment ◽  
Single Cross Section ◽  
Market Experience ◽  
Single Cross

This article applies both single cross-section and dual cross-section approaches to modeling the propensity to be self-employed among the foreign born in the Australian labor market. The results from a single cross-section regression indicate that educational attainment, Australian labor market experience, the availability of capital, marital status and job related characteristics are important influences on self-employment outcomes. The propensity to be self-employed among immigrants is shown to be enhanced by the existence of enclave markets. Ethnic enclaves created via a common language provide more relevant prospects for self-employment than does the concentration of immigrants by birthplace. However, enclave markets do not have a significant impact on the self-employment outcomes of the Australian-born children of immigrants. The dual cross-section approach shows that the cross-section self-employment growth among immigrants is predominantly an adjustment effect rather than a cohort effect.

When Politics Trumps Economics: Contrasting High-Skilled Immigration Policymaking in Germany and Austria

2020 ◽  
pp. 019791832091486
Author(s):  
Melanie Kolbe
Keyword(s):  
Labor Market ◽  
Immigration Policy ◽  
Institutional Context ◽  
Immigrant Integration ◽  
Organized Labor ◽  
Integration Policy ◽  
Policy Reforms ◽  
Issue Linkage ◽  
Skilled Immigration ◽  
Immigrant Integration Policy

High-skilled immigration (HSI) policy has become of increasing interest among immigrant destination countries, but success in establishing liberal policies has varied considerably across countries. Focusing on two reluctant immigration states, Germany and Austria, this article explains why HSI policy reforms in these two countries have led to starkly diverging outcomes. Whereas previous studies have concentrated on the politics of organized labor market actors and the market-institutional context in which they are embedded, this article contends that variation in HSI policy liberalization also reflects increasing politicization through issue linkage to adjacent immigration domains, in this case, immigrant integration policy. The findings challenge the predominant interest-group–centric work on HSI and show how arguments for and against liberalization can traverse immigration policy domains.

Impact of Foreign Worker Migration on Wage and Labor Market in Thailand

2015 ◽  
pp. 66-79
Author(s):  
Siriwan Saksiriruthai
Keyword(s):  
Economic Development ◽  
Labor Market ◽  
Migrant Workers ◽  
Migrant Worker ◽  
Critical Role ◽  
Foreign Worker ◽  
Negative Effects ◽  
Foreign Labor ◽  
Native Workers ◽  
The Impact

This chapter focuses on Thailand's foreign labor migration, which has played a critical role in the economic development of Thailand. Emphasizing both positive and negative effects of foreign migration to the Thai labor market, Thailand economy, and sustainability in economic development, this chapter separates foreign migrant workers into two types, legal and illegal, and analyzes the impact of each type of migrant worker on wages, labor market, Thai economy, innovation, and sustainability. While foreign skilled laborers, who usually receive formal work permits from the Thai government, as well as capital and native workers are complements, the unskilled or low-skilled workers, usually from neighbor countries, as well as capital and native workers, are substitutes. Furthermore, the impact of each group of foreign migrants on economic development and government reactions (as reflected in migration policies) is also elaborated before discussion for migration and development in the long term.

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