Ethnic Segregation and Immigrants’ Labor Market Outcomes: The Role of Education

Abstract

Given the conflicting findings about whether ethnic segregation benefits or hurts immigrants’ labor market outcomes in the existing literature, this paper investigates how segregation effects vary within young immigrants’ education levels. We also test the differential segregation effects for young immigrants with different education levels and from ethnic groups with different average education levels. We find that on average, ethnic segregation negatively impacts earnings of highly educated immigrants but benefits lower educated immigrants. Additionally, the net effects of ethnic segregation depend on whether immigrants’ own education levels match their group average education levels. Specifically, being segregated with many highly educated co-ethnics can reverse the negative segregation effects on highly educated immigrants’ earnings. However, a highly educated ethnic enclave can reduce the positive isolation effects for lower educated immigrants. Finally, we do not find significant segregation effects on immigrants’ employment.

Immigrant Ethnic Enclaves: Causes and Consequences

“…A recent study delves deeper into the interplay between the quality of ethnic enclaves and the skill levels of individual immigrants in the United States [57]. Utilizing a triple difference model, the study reveals that the overall impact of ethnic segregation depends on the alignment of immigrants' education levels with the average education levels of their ethnic group.…”