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The Wages and Language Skills of U.S. Immigrants

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  • Geoffrey Carliner

Abstract

This paper finds that immigrants on average earned about $0.50/hour less than native-born Americans in 1989. Immigrants from some regions earned much more than natives, while others, especially from Mexico, earned much less. This paper also finds that when immigrants first arrive in the U.S. they earn significantly less than native workers, but they close the gap by about 0.8 percentage points with each added year of residence. As a result, the wage of the typical immigrant who arrived in the 1950s and 1960s eventually surpassed the average native wage. Improvements in English language skills contributed 6 to 18 percent of this narrowing, depending on sex and education level. The remainder came from unmeasured sources of assimilation. However, since the 1950s and 1960s the wage gap between natives and newly arrived immigrants has widened by 0.2 to 0.6 percentage points annually. Because they start with a larger disadvantage the average wage of more recent immigrants may never exceed the average native wage. A decline in the average education of newly arrived immigrants accounts for 4-23% percent of the starting wage gap, and shifts in the source countries of new immigrants from Europe to Latin America and Asia account for 73 to 95 percent. Changes in English skills and in other factors have played little role in this relative decline. This analysis also finds a significant return to English skills. Even after controlling for education, region of origin, and years of U.S. residence, workers are rewarded for speaking English well. Differences between each of the five English skill categories reported in the Census data are about the same as the return to an additional year of schooling.

Suggested Citation

  • Geoffrey Carliner, 1996. "The Wages and Language Skills of U.S. Immigrants," NBER Working Papers 5763, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:5763
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    References listed on IDEAS

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    1. Chiswick, Barry R, 1978. "The Effect of Americanization on the Earnings of Foreign-born Men," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 897-921, October.
    2. Borjas, George J, 1985. "Assimilation, Changes in Cohort Quality, and the Earnings of Immigrants," Journal of Labor Economics, University of Chicago Press, vol. 3(4), pages 463-489, October.
    3. Rivera-Batiz, Francisco L., 1990. "English language proficiency and the economic progress of immigrants," Economics Letters, Elsevier, vol. 34(3), pages 295-300, November.
    4. Gilles Grenier, 1984. "The Effects of Language Characteristics on the Wages of Hispanic-American Males," Journal of Human Resources, University of Wisconsin Press, vol. 19(1), pages 35-52.
    5. Borjas, George J & Bratsberg, Bernt, 1996. "Who Leaves? The Outmigration of the Foreign-Born," The Review of Economics and Statistics, MIT Press, vol. 78(1), pages 165-176, February.
    6. Carliner, Geoffrey, 1980. "Wages, Earnings and Hours of First, Second, and Third Generation American Males," Economic Inquiry, Western Economic Association International, vol. 18(1), pages 87-102, January.
    7. Daneshvary, Nasser, et al, 1992. "Job Search and Immigrant Assimilation: An Earnings Frontier Approach," The Review of Economics and Statistics, MIT Press, vol. 74(3), pages 482-492, August.
    8. Dustmann, Christian, 1994. "Speaking Fluency, Writing Fluency and Earnings of Migrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 7(2), pages 133-156.
    9. Kossoudji, Sherrie A, 1988. "English Language Ability and the Labor Market Opportunities of Hispanic and East Asian Immigrant Men," Journal of Labor Economics, University of Chicago Press, vol. 6(2), pages 205-228, April.
    10. Levy, Frank & Murnane, Richard J, 1992. "U.S. Earnings Levels and Earnings Inequality: A Review of Recent Trends and Proposed Explanations," Journal of Economic Literature, American Economic Association, vol. 30(3), pages 1333-1381, September.
    11. Evelina Tainer, 1988. "English Language Proficiency and the Determination of Earnings among Foreign-Born Men," Journal of Human Resources, University of Wisconsin Press, vol. 23(1), pages 108-122.
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    Citations

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    Cited by:

    1. Stephen J. Trejo, 2003. "Intergenerational Progress of Mexican-Origin Workers in the U.S. Labor Market," Journal of Human Resources, University of Wisconsin Press, vol. 38(3).
    2. Darren Lubotsky, 2000. "Chutes or Ladders? A Longitudinal Analysis of Immigrant Earnings," Working Papers 824, Princeton University, Department of Economics, Industrial Relations Section..
    3. Darren Lubotsky, 2000. "Chutes or Ladders? A Longitudinal Analysis of Immigrant Earnings," Working Papers 824, Princeton University, Department of Economics, Industrial Relations Section..
    4. Lang Kevin & Siniver Erez, 2009. "The Return to English in a Non-English Speaking Country: Russian Immigrants and Native Israelis in Israel," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 9(1), pages 1-30, November.
    5. Berman, Eli & Lang, Kevin & Siniver, Erez, 2003. "Language-skill complementarity: returns to immigrant language acquisition," Labour Economics, Elsevier, vol. 10(3), pages 265-290, June.
    6. Chris Herbst & Burt Barnow, 2008. "Close to Home: A Simultaneous Equations Model of the Relationship Between Child Care Accessibility and Female Labor Force Participation," Journal of Family and Economic Issues, Springer, vol. 29(1), pages 128-151, March.
    7. Aparicio Fenoll, Ainhoa & Kuehn, Zoë, 2016. "Education Policies and Migration across European Countries," IZA Discussion Papers 9755, Institute for the Study of Labor (IZA).
    8. Lutz Hendricks, "undated". "Migration and Human Capital," Working Papers 97/6, Arizona State University, Department of Economics.
    9. Antonio Di Paolo & Josep Lluís Raymond, 2012. "Language knowledge and earnings in Catalonia," Journal of Applied Economics, Universidad del CEMA, vol. 15, pages 89-118, May.
    10. Darren Lubotsky, 2007. "Chutes or Ladders? A Longitudinal Analysis of Immigrant Earnings," Journal of Political Economy, University of Chicago Press, vol. 115(5), pages 820-867, October.
    11. Libertad González, 2005. "Nonparametric bounds on the returns to language skills," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(6), pages 771-795.
    12. Ethan G. Lewis, 2011. "Immigrant-Native Substitutability: The Role of Language Ability," NBER Working Papers 17609, National Bureau of Economic Research, Inc.
    13. Zavodny, Madeline, 2000. "The Effects of Official English Laws on Limited-English-Proficient Workers," Journal of Labor Economics, University of Chicago Press, vol. 18(3), pages 427-452, July.
    14. Gonzalez, Arturo, 2003. "The education and wages of immigrant children: the impact of age at arrival," Economics of Education Review, Elsevier, vol. 22(2), pages 203-212, April.
    15. Ono, Hiroshi & Zavodny, Madeline, 2007. "Immigrants, English Ability and the Digital Divide," IZA Discussion Papers 3124, Institute for the Study of Labor (IZA).
    16. Cortes, Kalena E., 2004. "Are Refugees Different from Economic Immigrants? Some Empirical Evidence on the Heterogeneity of Immigrant Groups in the United States," IZA Discussion Papers 1063, Institute for the Study of Labor (IZA).
    17. Padoan, Pier Carlo, 1998. "Trade, knowledge accumulation and diffusion: A sectoral perspective1," Structural Change and Economic Dynamics, Elsevier, vol. 9(3), pages 349-372, September.

    More about this item

    JEL classification:

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

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