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Breaking Barriers: The Impact of Employer Exposure to Immigrants

Author

Listed:
  • Lehrer, Steven

    (Queen's University and NBER)

  • Lepage, Louis-Pierre

    (Swedish Institute for Social Research)

  • Sousa Pereira, Nuno

    (University of Porto)

Abstract

We study how exposure of employers to immigrants, both at the market and at the individual firm level, mitigates immigrant-native disparities. We use administrative employee-employer matched data from Portugal, which provides a unique setting given that it experienced almost no immigration until the early 2000s followed by substantial immigration waves. Focusing on the evolution of market wages across successive immigration cohorts, we find that increased employer exposure to immigrant groups can account for up to 25% of the wage convergence between immigrants and natives over the last two decades. We also document that individual-level exposure of firms to immigrants plays an important role, influencing future hiring and remuneration of immigrants. Our results provide new insights into how barriers to hiring different worker groups shape economic inequality, with novel implications for integration policies.

Suggested Citation

  • Lehrer, Steven & Lepage, Louis-Pierre & Sousa Pereira, Nuno, 2024. "Breaking Barriers: The Impact of Employer Exposure to Immigrants," SOFI Working Papers in Labour Economics 2/2024, Stockholm University, Swedish Institute for Social Research.
    • Handle: RePEc:hhs:sofile:2024_002
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    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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