Immigration, Jobs and Employment Protection: Evidence from Europe before and during the Great Recession
69 Pages Posted: 30 Nov 2012
Date Written: October 26, 2012
In this paper we analyse the impact of immigrants on the type and quantity of natives’ jobs. We use data on fifteen Western European countries during the 1996-2010 period. We find that immigrants, by taking up manual-routine type of occupations pushed natives towards more “complex” (abstract and communication) jobs. This job upgrade was associated with a 0.7% increase in native wages for a doubling of the immigrants’ share. These results are robust to the use of an IV strategy based on the past settlement of immigrants across European countries. The job upgrade slowed, but did not come to a halt, during the Great Recession. We also document the labour market flows behind it: the complexity of jobs offered to new native hires was greater than that of lost jobs. Finally, we find evidence that the reallocation was larger in countries with more flexible labour laws.
Keywords: immigration, jobs, task specialization, employment protection laws, Europe
JEL Classification: J24, J31, J61
Suggested Citation: Suggested Citation