Low-Wage Jobs, Foreign-Born Workers, and Firm Performance

Abstract

How do migrant workers impact firm performance? We exploit an unexpected change in firms’ likelihood of securing low-wage workers through the U.S. H-2B visa program to address this question. Using comprehensive administrative data, we find that access to H-2B workers raises firms’ annual revenues and survival likelihood without crowding out other forms of employment. We do not find evidence of negative spillover effects on competitor firms. Our results support the notion that guest worker programs can mitigate labor shortages while limiting harm to incumbent workers.

Keywords: guest workers, migrants, employment, firm dynamics, H-2B visa

JEL Classification: J23, F22, J61