Task Specialization, Immigration, and Wages

Giovanni Peri, Chad Sparber

American Economic Journal Applied Economics · 2009 · 887 citations · 37 references

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Concepts

TL;DR

Large inflows of less educated immigrants can depress wages for similarly educated native workers, but task specialization between foreign and native workers may reduce this effect. The study uses O*NET task‑intensity data and census records to show that foreign‑born workers concentrate in manual‑physical occupations while natives focus on communication‑language tasks. The observed task specialization explains why studies find only modest wage effects of immigration on less educated natives. JEL codes: J24, J31, J61.

Abstract

Large inflows of less educated immigrants may reduce wages paid to comparably-educated, native-born workers. However, if less educated foreign- and native-born workers specialize in different production tasks, because of different abilities, immigration will cause natives to reallocate their task supply, thereby reducing downward wage pressure. Using occupational task-intensity data from the O*NET dataset and individual US census data, we demonstrate that foreign-born workers specialize in occupations intensive in manual-physical labor skills while natives pursue jobs more intensive in communication-language tasks. This mechanism can explain why economic analyses find only modest wage consequences of immigration for less educated native-born workers. (JEL J24, J31, J61)

References

37