Chapter 22. The Labor Market Integration and Impacts of US Immigrants

Over the last several decades, two of the most significant developments in the US labor market have been: (1) rising inequality, and (2) growth in both the size and the diversity of immigration flows. Because a large share of new immigrants arrive with very low levels of schooling, English proficiency, and other skills that have become increasingly important determinants of success in the US labor market, an obvious concern is that such immigrants are a poor fit for the restructured American economy. In this chapter, we first place this concern in context by briefly describing the history of US immigration policy and immigrant flows. We then evaluate the concern by discussing evidence for the United States on three relevant topics: the labor market integration of immigrants, the socio-economic attainment of the US-born descendants of immigrants, and the impact of immigration on the earnings and employment opportunities of native workers. We show that immigrants have little trouble finding paid employment and that the wages they earn are commensurate with their skills. Overall, the US-born second generation has achieved educational parity with mainstream society; for some Hispanic groups, however, this is not the case. Finally, we survey the pertinent academic literature and conclude that, on the whole, immigration to the US has not had large adverse consequences for the labor market opportunities of native workers.