Does Immigration Affect Wages? A Look at Occupation-Level Evidence

IZA Discussion Paper No. 2481

FRB of Atlanta Working Paper No. 2003-2

35 Pages Posted: 3 Apr 2003

See all articles by Pia M. Orrenius

Pia M. Orrenius

Federal Reserve Banks - Federal Reserve Bank of Dallas

Madeline Zavodny

University of North Florida; IZA Institute of Labor Economics; Agnes Scott College

Date Written: December 2006

Abstract

Previous research has reached mixed conclusions about the effect of higher levels of immigration on the wages of natives. This paper reexamines this question using data from the Current Population Survey and the Immigration and Naturalization Service and focuses on differential effects by skill level. Using occupation as a proxy for skill, we find that an increase in the fraction of foreign-born workers tends to lower the wages of natives in blue collar occupations - particularly after controlling for endogeneity - but does not have a statistically significant negative effect among natives in skilled occupations. The results also indicate that immigrants adjusting their immigration status within the U.S., but not newly arriving immigrants, have a significant negative impact on the wages of low-skilled natives. This suggests that immigrants become closer substitutes for natives as they spend more time in the U.S.

Keywords: immigrants, natives, wages

JEL Classification: J61

Suggested Citation

Orrenius, Pia M. and Zavodny, Madeline, Does Immigration Affect Wages? A Look at Occupation-Level Evidence (December 2006). IZA Discussion Paper No. 2481, FRB of Atlanta Working Paper No. 2003-2, Available at SSRN: https://ssrn.com/abstract=382000 or http://dx.doi.org/10.2139/ssrn.382000

Pia M. Orrenius (Contact Author)

Federal Reserve Banks - Federal Reserve Bank of Dallas ( email )

PO Box 655906
Dallas, TX 75265-5906
United States
214-922-5747 (Phone)
214-922-5194 (Fax)

Madeline Zavodny

University of North Florida ( email )

4567 St. Johns Bluff Road, South
Jacksonville, FL 32224-2645
United States

IZA Institute of Labor Economics

Schaumburg-Lippe-Str. 7 / 9
Bonn, D-53072
Germany

Agnes Scott College ( email )

United States

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