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The Impact of Immigration on the Labor Market Outcomes of Native Workers: Evidence using Longitudinal Data from the LEHD

January 2016

Written by: Ted Mouw

Working Paper Number:

CES-16-56

Abstract

Empirical estimates of the effect of immigration on native workers that rely on spatial comparisons have generally found small effects, but have been subject to the criticism that out-migration by native workers dampens the observed effect by spreading it over a larger area. In contrast, studies that rely on variation in immigration across industries, occupations, or education-based skill-levels often report large negative effects, but rely primarily on repeated cross-sectional data sets which also cannot account for the adjustment of native workers over time. In this paper, we use a newly available data set, the Longitudinal Employer Household Data (LEHD), which provides quarterly earnings records, geographic location, and firm and industry identifiers for 97% of all privately employed workers in 29 states. We use this data to analyze the impact of immigration on earnings changes and the mobility response of native workers. Overall, we find that although immigration has a negative effect on the earnings and employment of native workers, and positive effects on their firm, industry, and cross-state mobility, the overall size of the effects is small.

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endogeneity, employ, employed, ethnic, hispanic, immigrant, metropolitan, workforce, geographically, occupation, native, immigration, mobility, geographic, residence, migrate, migration, migrating, migrant, refugee

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Metropolitan Statistical Area, Social Security Administration, National Science Foundation, Center for Economic Studies, Census Bureau Center for Economic Studies, Current Population Survey, Decennial Census, Chicago Census Research Data Center, Research Data Center, North American Industry Classification System, American Community Survey, Social Security Number, Longitudinal Employer Household Dynamics, PSID, Protected Identification Key, Quarterly Census of Employment and Wages, 2010 Census, SSA Numident, Pew Research Center

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