Research Finds Slowdown in the Economic Assimilation of New Immigrants

10.24.2013 | A new study by George J. Borjas finds that immigrants since the 1990s are not “economically assimilating” as fast as prior waves of newcomers to the United States.

Immigrants arriving in the United States—save for those brainiacs who go straight to Silicon Valley—have typically earned less than native-born Americans, at least at first. Eventually, with time in the country, a better grasp on the language, and education, immigrants’ earnings have started to match those of the native-born. But not lately.

Those arriving before the 1980s, for example, saw their wage gap narrow by about 15 percentage points over their first two decades here. Those arriving in the 1990s, however, saw no change in the wage gap.

Borjas, the Robert W. Scrivner professor of economics and social policy at Harvard University’s John F. Kennedy School of Government, wondered why that was. He considered whether it was the changing economy (no effect), the makeup of the immigrant population (likewise, no effect), and where in the US they landed (also, no effect).

Instead, he found, it’s likely the fact that they don’t feel as much pressure to learn English.

The rate at which immigrants increased their fluency in English has slowed by half in the most recent decades. Borjas suggests that it might be because those recent arrivals who join huge, already established immigrant communities don’t have as great an incentive to learn English, and that keeps them back when it comes to wage growth.

As he finds, “the rate of increase in English language proficiency was significantly slower for larger national origin groups than smaller groups. The growth in the size of these groups accounts for about a quarter of the decline in the rates of human capital acquisition and economic assimilation.”

While Borjas is only analyzing more recent waves of immigrants, it’s interesting to look back at the equally large immigration waves in mid- and late nineteenth century. Germans, Italians, Jews, and Chinese (to name but a few) found similarly large ethnic enclaves then, in some cases sustaining their languages for generations, yet many eventually assimilated economically.

Meanwhile, The New York Times discovered that Midwestern cities are welcoming immigrants to town as an economic renewal strategy. Focusing on Dayton, Ohio’s Welcome Dayton plan, the story by reporter Julia Preston traces the whys and wherefores before concluding (link in the original):

Recent research suggests that Dayton’s experience is not accidental. In a national study published last month, Jacob L. Vigdor, an economics professor at Duke University, found that over the last four decades, immigrants helped preserve and in some cases add manufacturing jobs in cities where they settled, sustaining employment for Americans. They also added to local housing values. For every thousand immigrants who moved into a county, 270 Americans moved in after them, Mr. Vigdor found.

Dayton’s immigrant experiment is particularly close to home for one lawmaker who will most likely have a major impact on the debate in Washington: the Republican speaker of the House, John A. Boehner. His district wraps around the city on three sides.

But Dayton officials said they were not waiting for Congress. “We’ve found that we can repopulate our city and we can educate the people and inspire them to employ themselves,” Mayor Leitzell said. “In 10 years, when the federal government figures everything out, we’ll be thriving.”

By the way, BRR has previously discussed the economic integration of immigrants previously, along with immigration and regional resilience.

Photo / Vistavision

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