The Cost of Waiting for Nationality: Impact on Immigrant’s Labor Market Outcomes in Spain

In this paper, I examine the impact of administrative delays in obtaining Spanish nationality on the long-term labor market outcomes of legal immigrants. Using Social Security data from 2006 to 2019 and an instrumental variable strategy, I find that longer delays in nationality acquisition result in significantly lower accumulated earnings over a ten-year period, driven by both lower wages and fewer days worked. Specifically, one additional year of delay reduces accumulated earnings over 10 years by 3.8 to 6.7 percent. To understand the underlying mechanisms, I study the short-term effects of nationality acquisition on job mobility and job quality. The results suggest that delays prolong the period of restricted mobility, hindering access to better employment opportunities. After obtaining the nationality, immigrants can afford a more selective and longer job search that pays off in the long run. These findings underscore the importance of timely nationality acquisition for improving economic outcomes and highlight the need for efficient administrative processes to support immigrant integration.