Selectivity and Immigrant Employment

Brian Duncan, University of Colorado at Denver
Stephen Trejo, University of Texas at Austin

Jointly modeling location and employment decisions turns out to have important implications for migrant selectivity. Existing microeconomic models of migrant self-selection ignore employment decisions, and these models demonstrate that immigrants need not be favorably selected in terms of their wages or labor market skills. By contrast, we show that immigrants are likely to be favorably selected in terms of employment rates. Moreover, the interaction between decisions regarding work and migration serves to limit the extent to which immigrants can be negatively selected in terms of skills. Empirical analysis of microdata from the 2000 U.S. Census confirms the main implication of the theoretical model. In particular, at low skill levels foreign-born men are more likely to work than U.S.-born men, whereas at high skill levels the employment rates of immigrants and natives are similar.