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The impact of immigration on occupational wages: evidence from Britain

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Author Info

  • Stephen Nickell
  • Jumana Saleheen

Abstract

This paper asks whether immigration to Britain has had any impact on average wages. There seems to be a broad consensus among academics that the share of immigrants in the workforce has little or no effect on the pay rates of the indigenous population. But the studies in the literature have typically not refined their analysis by breaking it down into different occupational groups. In this paper we find that once the occupational breakdown is incorporated into a regional analysis of immigration in Britain, the immigrant-native ratio has a significant, small, negative impact on average wages. Closer examination reveals that the biggest impact is in the semi/unskilled services sector. This finding accords well with intuition and anecdote, but does not seem to have been recorded previously in the empirical literature.

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Bibliographic Info

Paper provided by Federal Reserve Bank of Boston in its series Working Papers with number 08-6.

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Date of creation: 2008
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Handle: RePEc:fip:fedbwp:08-6

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Keywords: Emigration and immigration - Great Britain ; Wages - Great Britain;

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References

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  1. Manacorda, Marco & Manning, Alan & Wadsworth, Jonathan, 2006. "The Impact of Immigration on the Structure of Male Wages: Theory and Evidence from Britain," IZA Discussion Papers 2352, Institute for the Study of Labor (IZA).
  2. Ethan Lewis, 2005. "Immigration, skill mix, and the choice of technique," Working Papers 05-8, Federal Reserve Bank of Philadelphia.
  3. David Card & John E. DiNardo, 2000. "Do Immigrant Inflows Lead to Native Outflows?," NBER Working Papers 7578, National Bureau of Economic Research, Inc.
  4. David Card, 2004. "Is the New Immigration Really So Bad?," CReAM Discussion Paper Series 0402, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  5. David Card, 1989. "The Impact of the Mariel Boatlift on the Miami Labor Market," Working Papers 633, Princeton University, Department of Economics, Industrial Relations Section..
  6. Gianmarco I.P. Ottaviano & Giovanni Peri, 2006. "Rethinking the Gains from Immigration: Theory and Evidence from the U.S," Working Papers 2006.52, Fondazione Eni Enrico Mattei.
  7. Pesaran, M. Hashem & Smith, Ron, 1995. "Estimating long-run relationships from dynamic heterogeneous panels," Journal of Econometrics, Elsevier, vol. 68(1), pages 79-113, July.
  8. Nickell, Stephen J, 1981. "Biases in Dynamic Models with Fixed Effects," Econometrica, Econometric Society, vol. 49(6), pages 1417-26, November.
  9. Baltagi, Badi H. & Li, Qi, 1995. "Testing AR(1) against MA(1) disturbances in an error component model," Journal of Econometrics, Elsevier, vol. 68(1), pages 133-151, July.
  10. Paul Beaudry & Mark Doms & Ethan Lewis, 2006. "Endogenous skill bias in technology adoption: city-level evidence from the IT revolution," Working Paper Series 2006-24, Federal Reserve Bank of San Francisco.
  11. Christian Dustmann & Francesca Fabbri & Ian Preston, 2005. "The Impact of Immigration on the British Labour Market," Economic Journal, Royal Economic Society, vol. 115(507), pages F324-F341, November.
  12. Ethan Lewis, 2003. "Local, open economies within the U.S.: how do industries respond to immigration?," Working Papers 04-1, Federal Reserve Bank of Philadelphia.
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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Immigration & the media
    by chris dillow in Stumbling and Mumbling on 2011-07-18 14:40:04
  2. Miliband on immigration
    by chris dillow in Stumbling and Mumbling on 2010-09-29 13:05:08
  3. Immigration: let's not be reasonable
    by chris dillow in Stumbling and Mumbling on 2012-11-02 14:40:42
  4. Immigration & irrationalism
    by chris dillow in Stumbling and Mumbling on 2013-03-26 14:26:19
  5. Divide-and-rule
    by chris dillow in Stumbling and Mumbling on 2012-12-17 14:45:31
  6. Talking about immigration
    by chris dillow in Stumbling and Mumbling on 2013-03-08 15:30:30
  7. UKIP: the victory of the ruling class
    by chris dillow in Stumbling and Mumbling on 2013-05-04 11:44:21
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Cited by:
  1. Christian Dustmann & Tommaso Frattini & Caroline Halls, 2010. "Assessing the Fiscal Costs and Benefits of A8 Migration to the UK," Fiscal Studies, Institute for Fiscal Studies, vol. 31(1), pages 1-41, 03.
  2. Blanchflower, David G. & Lawton, Helen, 2008. "The Impact of the Recent Expansion of the EU on the UK Labour Market," IZA Discussion Papers 3695, Institute for the Study of Labor (IZA).

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