Immigration, Jobs and Employment Protection: Evidence from Europe before and during the Great Recession

69 Pages Posted: 30 Nov 2012

See all articles by Francesco D’Amuri

Francesco D’Amuri

Bank of Italy; University of Essex - Institute for Social and Economic Research (ISER)

Giovanni Peri

University of California, Davis - Department of Economics

Date Written: October 26, 2012

Abstract

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

D’Amuri, Francesco and Peri, Giovanni, Immigration, Jobs and Employment Protection: Evidence from Europe before and during the Great Recession (October 26, 2012). Bank of Italy Temi di Discussione (Working Paper) No. 886. Available at SSRN: https://ssrn.com/abstract=2182589 or http://dx.doi.org/10.2139/ssrn.2182589

Francesco D’Amuri (Contact Author)

Bank of Italy ( email )

Via Nazionale 91
00184 Roma
Italy

University of Essex - Institute for Social and Economic Research (ISER) ( email )

Wivenhoe Park
Colchester CO4 3SQ
United Kingdom

Giovanni Peri

University of California, Davis - Department of Economics ( email )

One Shields Drive
Davis, CA 95616-8578
United States
530-752-3033 (Phone)
530-752-9382 (Fax)

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