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On The Risk Of Unemployment: A Comparative Assessment of the Labour Market Success of Migrants in Australia

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  • Prem Thapa

Abstract

One important indicator of the successful assimilation of immigrants is the comparison of the relative success of immigrants and of the native born population in finding employment under different macro economic regimes that affect the overall rate of unemployment in an economy. This paper analyzes the "risk" of unemployment of male immigrants to Australia relative to the native born for two different time periods in which the overall labour market characteristics and the pool of immigrants differ considerably. The two data sets used are the 1990 Income and Housing Costs Survey conducted by the Australian Bureau of Statistics and the first wave of the Household Income and Labour Dynamics in Australia (HILDA) survey whose data refer primarily to the 2001 calendar year. The paper analyzes the correlates of unemployment at the individual level using logistic and probit regression models. It uses both a standard specification of the probability of being unemployed determined by individual and family level socio-economic characteristics (i.e. years of schooling and work experience, age, years since migration, etc.); and an extended model that is feasible only with the extra information available in the HILDA data set. The results show there is a clear disadvantage in the probability of finding employment for migrants with similar characteristics of a native born Australian in both the standard and extended model specifications. There also are very distinct country of birth effects which persist even after controlling for the individual migrant's English language skills. The relative disadvantage of migrants has not diminished between the two time periods in spite of greater emphasis on skilled migration in recent years. By providing a clearer understanding of why and how the individual and subgroup level characteristics are correlated with the probability of an individual being unemployed, this paper gives valuable insights on how the Australian labor market functions, and, in particular on how it evaluates the employment prospects of specific immigrant groups.

Suggested Citation

  • Prem Thapa, 2004. "On The Risk Of Unemployment: A Comparative Assessment of the Labour Market Success of Migrants in Australia," CEPR Discussion Papers 473, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    • Handle: RePEc:auu:dpaper:473
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    References listed on IDEAS

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    1. P. N. Junankar & Satya Paul & Wahida Yasmeen, 2010. "Are Asian Migrants Discriminated Against In The Labor Market? A Case Study Of Australia," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 55(04), pages 619-646.
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    Cited by:

    1. Jaai Parasnis & Dietrich Fausten & Roland Cheo, 2008. "Do Australian Qualifications Help? The Effect of Host Country Qualification on Migrant Participation and Unemployment," The Economic Record, The Economic Society of Australia, vol. 84(s1), pages 131-140, September.
    2. Gatina, Liliya, 2016. "Does money buy happiness? Financial and general well-being of immigrants in Australia," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 63(C), pages 91-105.
    3. Nina Westerheide & Goran Kauermann, 2014. "Unemployed in Germany: Factors Influencing the Risk of Losing the Job," Research in World Economy, Research in World Economy, Sciedu Press, vol. 5(2), pages 43-55, September.
    4. Deborah A. Cobb‐Clark & Lihini De Silva, 2021. "Participation, Unemployment, and Wages," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 54(4), pages 482-493, December.
    5. Jaai Parasnis & Dietrich Fausten & Russell Smyth, 2006. "The Impact of Immigration on Native Workers in Australia," Monash Economics Working Papers archive-40, Monash University, Department of Economics.
    6. Denise Doiron & Rochelle Guttmann, 2009. "Wealth Distributions of Migrant and Australian‐born Households," The Economic Record, The Economic Society of Australia, vol. 85(268), pages 32-45, March.
    7. Bruce Chapman & Paul Flatau, 2004. "Introduction and Appendix: The Household, Income and Labour Dynamics in Australia (HILDA) Survey Special Issue: Case Studies in Labour Economics," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 7(2), pages 109-124, June.
    8. Prem Jung Thapa & Tue Gørgens, 2006. "A Duration Analysis of the Time Taken to Find the First Job for Newly Arrived Migrants in Australia," CEPR Discussion Papers 527, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    9. Kelly, Elish & McGuinness, Seamus & O'Connell, Philip J., 2011. "Transitions to Long-Term Unemployment Risk Among Young People: Evidence from Ireland," Papers WP394, Economic and Social Research Institute (ESRI).

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    More about this item

    Keywords

    employment prospects of migrants; immigrant workers and assimilation; unemployment probabilities; immigrants in Australia;
    All these keywords.

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination

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