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Low-wage jobs, foreign-born workers, and firm performance

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  • Amuedo Dorantes, Catalina
  • Arenas-Arroyo, Esther
  • Mahajan, Parag
  • Schmidpeter, Bernhard

Abstract

We examine how migrant workers impact firm performance using administrative data from the United States. Exploiting an unexpected change in firms' likelihood of securing low-wage workers through the H-2B visa program, we find limited crowd-out of other forms of employment and no impact on average pay at the firm. Yet, access to H-2B workers raises firms' annual revenues and survival likelihood. Our results are consistent with the notion that guest worker programs can help address labor shortages without inflicting large losses on incumbent workers.

Suggested Citation

  • Amuedo Dorantes, Catalina & Arenas-Arroyo, Esther & Mahajan, Parag & Schmidpeter, Bernhard, 2023. "Low-wage jobs, foreign-born workers, and firm performance," Ruhr Economic Papers 1040, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    • Handle: RePEc:zbw:rwirep:279541
    DOI: 10.4419/96973209
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    References listed on IDEAS

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    1. Parag Mahajan, 2021. "Immigration and Local Business Dynamics: Evidence from U.S. Firms," Working Papers 21-18, Center for Economic Studies, U.S. Census Bureau.
    2. Andreas Beerli & Jan Ruffner & Michael Siegenthaler & Giovanni Peri, 2021. "The Abolition of Immigration Restrictions and the Performance of Firms and Workers: Evidence from Switzerland," American Economic Review, American Economic Association, vol. 111(3), pages 976-1012, March.
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    5. Shalise Ayromloo & Benjamin Feigenberg & Darren Lubotsky, 2020. "States Taking the Reins? Employment Verification Requirements and Local Labor Market Outcomes," NBER Working Papers 26676, National Bureau of Economic Research, Inc.
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    8. Agostina Brinatti & Nicolas Morales, 2021. "Firm Heterogeneity and the Impact of Immigration: Evidence from German Establishments," Working Paper 21-16, Federal Reserve Bank of Richmond.
    9. Michael A. Clemens & Ethan G. Lewis & Hannah M. Postel, 2018. "Immigration Restrictions as Active Labor Market Policy: Evidence from the Mexican Bracero Exclusion," American Economic Review, American Economic Association, vol. 108(6), pages 1468-1487, June.
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    Cited by:

    1. Silliman, Mikko & Willén, Alexander, 2024. "Worker Power, Immigrant Sorting, and Firm Dynamics," Discussion Paper Series in Economics 13/2024, Norwegian School of Economics, Department of Economics.

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    More about this item

    Keywords

    Guest workers; migrants; employment; firm dynamics; H-2B visa;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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