Immigrants from ENP countries and employment dismissal in Spain

Purpose - – The purpose of this paper is to check if the rate of employment dismissal in the Spanish labour market is higher for immigrants from countries of the European Neighbourhood Policy (ENP) than for the native-born and the immigrants from other developing countries. It also analyses the impact on this rate of the lower endowment of human capital and the segregation in particular occupations and sectors of ENP immigrants. Design/methodology/approach - – The study exploits micro-data from the Labour Force Survey before and during the great depression in Spain. The authors define two groups of immigrants, one for those whose origin is an ENP country and another for those from the rest of the developing countries. Then the rate of job loss is computed for the natives and the two groups of immigrants based on the information for each individual in the sample for each of the years under analysis. An empirical model for the probability of employment dismissal is estimated to check if the immigrant-native gap vanishes when controlling for differences in human capital and occupational, sectoral, and territorial allocation of jobs. This traditional approach is complemented with a new proposal based on the decomposition of the gap using a method that does not impose the same response to the observed characteristics in the three demographic groups under analysis. Findings - – Immigrants from ENP face a higher rate of employment dismissal. The gap with respect to natives and even to other immigrants increased during the crisis. Most of the gap can be explained by the lower endowment of human capital of the ENP immigrants and, particularly, by their allocation in certain occupations, sectors, and territories. Originality/value - – Novelties in this paper include: first, the study of employment layoffs for natives and immigrants in a period of crisis in a country such as Spain that attracted massive migration during the booming period; second, the analysis of the origin of the higher rate of employment dismissal for immigrants from the ENP; and third, the proposal of a new approach to assess the contribution of human capital and segregation on the immigrant-native gap in the rate of job loss.