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When Minority Labor Migrants Meet the Welfare State

Author

Listed:
  • Bratsberg, Bernt

    () (Ragnar Frisch Centre for Economic Research)

  • Raaum, Oddbjørn

    () (Ragnar Frisch Centre for Economic Research)

  • Røed, Knut

    () (Ragnar Frisch Centre for Economic Research)

Abstract

We find that the lifecycle employment profiles of nonwestern male labor migrants who came to Norway in the early 1970s diverge significantly from those of native comparison persons. During the first years after arrival almost all of the immigrants worked and their employment rate exceeded that of natives. But, about ten years upon arrival, immigrant employment started a sharp and steady decline. By 2000, the immigrant employment rate was 50 percent, compared to 87 percent for the native comparison group. To some extent, the decline in immigrant employment can be explained by immigrants being overrepresented in jobs associated with short employment careers. But we also identify considerable disincentives embedded in the social security system that contribute to poor lifecycle employment performance of immigrants with many dependent family members. Finally, we uncover evidence that labor immigrants are particularly vulnerable to the state of the economy and face a high probability of permanent exit from employment during economic downturns.

Suggested Citation

  • Bratsberg, Bernt & Raaum, Oddbjørn & Røed, Knut, 2007. "When Minority Labor Migrants Meet the Welfare State," IZA Discussion Papers 2872, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp2872
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    Cited by:

    1. Knut Røed & Jens Fredrik Skogstrøm, 2014. "Unemployment Insurance and Entrepreneurship," LABOUR, CEIS, vol. 28(4), pages 430-448, December.
    2. Simen Markussen & Knut Røed, 2015. "Social Insurance Networks," Journal of Human Resources, University of Wisconsin Press, vol. 50(4), pages 1081-1113.
    3. Berglann, Helge & Moen, Espen R. & Røed, Knut & Skogstrøm, Jens Fredrik, 2011. "Entrepreneurship: Origins and returns," Labour Economics, Elsevier, vol. 18(2), pages 180-193, April.
    4. Augustin de Coulon & Dragos Radu, 2012. "Migrant Networks and Migration Policy: A “Grease or Sand the Wheel†Relationship?," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 9(4), pages 32-36, 02.
    5. Barth, Erling & Bratsberg, Bernt & Raaum, Oddbjørn, 2012. "Immigrant wage profiles within and between establishments," Labour Economics, Elsevier, vol. 19(4), pages 541-556.
    6. Bernt Bratsberg & Oddbjørn Raaum & Knut Røed, 2017. "Immigrant labor market integration across admission classes," CReAM Discussion Paper Series 1702, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
    7. Christoph Wunder & Regina T. Riphahn, 2014. "The dynamics of welfare entry and exit amongst natives and immigrants," Oxford Economic Papers, Oxford University Press, vol. 66(2), pages 580-604.
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    9. Bratsberg, Bernt & Fevang, Elisabeth & Røed, Knut, 2013. "Job loss and disability insurance," Labour Economics, Elsevier, vol. 24(C), pages 137-150.
    10. J. David Brown & Serife Genc & Julie L. Hotchkiss & Myriam Quispe-Agnoli, 2014. "Undocumented Workers' Employment Across U.S. Business Cycles," Contemporary Economic Policy, Western Economic Association International, vol. 32(3), pages 653-670, July.
    11. Michele Pellizzari, 2013. "The use of welfare by migrants in Italy," International Journal of Manpower, Emerald Group Publishing, vol. 34(2), pages 155-166, May.
    12. Bratsberg, Bernt & Raaum, Oddbjørn & Røed, Knut, 2011. "Educating Children of Immigrants: Closing the Gap in Norwegian Schools," IZA Discussion Papers 6138, Institute for the Study of Labor (IZA).
    13. Christian Dustmann & Giovanni Facchini & Cora Signorotto, 2015. "Population, Migration, Ageing and Health: A Survey," CReAM Discussion Paper Series 1518, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
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    15. Anton Nilsson, 2015. "Who suffers from unemployment? The role of health and skills," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-24, December.
    16. repec:eee:hapoch:v1_119 is not listed on IDEAS
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    18. Andrew Ellul & Chotibhak Jotikasthira & Christian T. Lundblad & Yihui Wang, 2012. "Is Historical Cost Accounting a Panacea? Market Stress, Incentive Distortions, and Gains Trading," FMG Discussion Papers dp701, Financial Markets Group.
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    22. Zaiceva, A. & Zimmermann, K.F., 2016. "Migration and the Demographic Shift," Handbook of the Economics of Population Aging, Elsevier.

    More about this item

    Keywords

    labor market outcomes; labor migration;

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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