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

  • Prem Thapa
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    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.

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    File URL: http://cbe.anu.edu.au/researchpapers/cepr/DP473.pdf
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    Paper provided by Centre for Economic Policy Research, Research School of Economics, Australian National University in its series CEPR Discussion Papers with number 473.

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    Length: 36 pages
    Date of creation: Jan 2004
    Date of revision:
    Handle: RePEc:auu:dpaper:473
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    1. Chiswick, Barry R, 1983. "An Analysis of the Earnings and Employment of Asian-American Men," Journal of Labor Economics, University of Chicago Press, vol. 1(2), pages 197-214, April.
    2. Foster L & Marshall, A & Williams LS, 1991. "Discrimination against immigrant workers in Australia," ILO Working Papers 284418, International Labour Organization.
    3. 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.
    4. Cobb-Clark, Deborah A, 2000. "Do Selection Criteria Make a Difference? Visa Category and the Labour Market Status of Immigrants to Australia," The Economic Record, The Economic Society of Australia, vol. 76(232), pages 15-31, March.
    5. Denise J. Doiron & W. Craig Riddell, 1994. "The Impact of Unionization on Male-Female Earnings Differences in Canada," Journal of Human Resources, University of Wisconsin Press, vol. 29(2), pages 504-534.
    6. Borooah, Vani K & Mangan, John, 2002. "An Analysis of Occupational Outcomes for Indigenous and Asian Employees in Australia," The Economic Record, The Economic Society of Australia, vol. 78(240), pages 31-49, March.
    7. Bruce Chapman & Deborah Cobb-Clark, 1999. "The Changing Pattern of Immigrants' Labour Market Experiences," CEPR Discussion Papers 396, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    8. Ronald Oaxaca, 1971. "Male-Female Wage Differentials in Urban Labor Markets," Working Papers 396, Princeton University, Department of Economics, Industrial Relations Section..
    9. Brooks, Clive & Volker, Paul, 1986. "The Probability of Leaving Unemployment: The Influence of Duration, Destination and Demographics," The Economic Record, The Economic Society of Australia, vol. 62(178), pages 296-309, September.
    10. Miller, Paul W, 1986. "Immigrant Unemployment in the First Year of Australian Labour Market Activity," The Economic Record, The Economic Society of Australia, vol. 62(176), pages 82-87, March.
    11. Beggs, John J & Chapman, Bruce J, 1988. "Immigrant Wage Adjustment in Australia: Cross Section and Time-Series Estimates," The Economic Record, The Economic Society of Australia, vol. 64(186), pages 161-67, September.
    12. Westin, Richard B., 1974. "Predictions from binary choice models," Journal of Econometrics, Elsevier, vol. 2(1), pages 1-16, May.
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