CAREER PATHS OF MIGRANTS IN DESTINATION LABOR MARKETS Çağlar Özden* Development Research Group THE WORLD BANK EU-OECD DIALOGUE ON INTERNATIONAL MIGRATION & MOBILITY Brussels February 24, 2014 *Usual disclaimer applies. The views expressed in this presentation are those of the author and should not be attributed to the World Bank, its Executive Directors and the Countries they represent.
MIGRANTS IN EVERY LABOR MARKET Real Madrid UEFA Champions League Champions 2014 Côte d'ivoire World Cup Champions 2014
MIGRANTS IN EVERY LABOR MARKET 2010-12 Academy Awards for Best Director 2013 Nobel Prize in Chemistry
MIGRANTS IN EVERY LABOR MARKET Taxi Drivers in New York City 8 countries represented Over half have college degrees Brent Holster interviews, 2004
WHAT EXPLAINS BRAIN EXPANSION & BRAIN WASTE?
I. How does occupational placement and career paths vary by country? II. III. What explains this variation? How does performance evolve over time? IV. How do economic flucutations affect migrants careers?
I HAVE TWO CHOICES: I. POLICY ORIENTED Conceptual Presentation II. DATA/RESEARCH ORIENTED Empirical Presentation
DATA: US census 1980-2000 + American Community Survey 2010 Foreign educated males critical 25-65 & employed Range of Education variables, year of arrival, age Performance indicators: i. Prestige index ii. Average Education level of the current occupation iii. Income
ANALYSIS: What determines performance? Multivariable estimation with performance indicators as dependent variables Explanatory variables: i. Education ii. Age iii. Country of Origin iv. Year of arrival v. Interactions of the above variables Once estimation completed, construct artificial individuals identical in every respect except country of origin Predict their performance over time.
OCCUPATIONAL PLACEMENT 1980 Tertiary Educated Migrant, 25 years old at the time of arrival in 1975 65 60 55 50 Anglo_Saxon Central_America East_Asia Mexico South_Asia Western_Europe 45 40 1980 1990 2000 2011 OCCUPTIONAL PRESTIGE INDEX
OCCUPATIONAL PLACEMENT 1990 Tertiary Educated Migrant, 25 years old at the time of arrival in 1975 65 60 55 50 Anglo_Saxon Central_America East_Asia Mexico South_Asia Western_Europe 45 40 1980 1990 2000 2011 OCCUPTIONAL PRESTIGE INDEX
OCCUPATIONAL PLACEMENT 2010 Tertiary Educated Migrant, 25 years old at the time of arrival in 1975 65 60 55 50 Anglo_Saxon Central_America East_Asia Mexico South_Asia Western_Europe 45 40 1980 1990 2000 2011 OCCUPTIONAL PRESTIGE INDEX
OBSERVATIONS: Significant initial heterogeneity in occupational attainment Significant improvement over time in initial years after arrival Convergence catching up by lower performing Latin American migrants The Crisis affects all migrants, but especially the Latin Americans. They lose significant ground and gap re-opens
OCCUPATIONAL PLACEMENT 1980-2010 High-school Educated Migrant, 25 years old at the time of arrival in 1975 50 45 40 35 Anglo_Saxon Central_America East_Asia Mexico South_Asia Western_Europe 30 1980 1990 2000 2011 OCCUPTIONAL PRESTIGE INDEX
Tertiary Educated Migrant, 25 years old at the time of arrival in 1995 70 65 60 55 50 Anglo_Saxon Central_America East_Asia Mexico South_America Western_Europe 45 40 2000 2011 OCCUPTIONAL PRESTIGE INDEX
OBSERVATIONS: Migrants without tertiary education show significant differences. There is limited improvement, convergence (before crisis) and decline after crisis Still Latin American migrants are the worst impacted during the crisis. Recent arrivals are less affected (both positive and negative) but Latin American migrants again bear the burden
INCOME LEVELS 1980-2010 Tertiary Educated Migrant, 25 years old at the time of arrival in 1975 12.0 11.5 11.0 10.5 10.0 Anglo_Saxon Central_America East_Asia Mexico South_Asia Western_Europe 9.5 9.0 1980 1990 2000 2011 INCOME LEVELS (Natural log)
OBSERVATIONS: Significant initial heterogeneity in wages for tertiary educated migrants Significant improvement over time in initial years after arrival LIMITED Convergence catching up by lower performing Latin American migrants gaps are maintained The Crisis affects tertiary educated Latin Americans. They lose significant ground and gap expands from 75% to 110%
INCOME LEVELS 2000-2010 Tertiary Educated Migrant, 25 years old at the time of arrival in 1995 12.0 11.5 11.0 10.5 10.0 Anglo_Saxon Central_America East_Asia Mexico South_Asia Western_Europe 9.5 9.0 2000 2011 INCOME LEVELS (Natural log)
OBSERVATIONS: Significant initial heterogeneity in wages for newer tertiary educated migrants Limited improvement in wages No Convergence gaps are maintained The Crisis affects everybody equally
High-School Educated Migrant, 25 years old at the time of arrival in 1975 11.0 10.5 10.0 9.5 9.0 Anglo_Saxon Central_America East_Asia Mexico South_Asia Western_Europe 8.5 8.0 1980 1990 2000 2011 INCOME LEVELS (Natural log)
OBSERVATIONS: Significant initial heterogeneity in wages for high school educated migrants Significant improvement over time in initial years after arrival LIMITED Convergence catching up by lower performing Latin American migrants gaps are maintained The Crisis affects all less educated migrants equally.
I. How does occupational placement and career paths vary by country? SIGNIFICANTLY! Results available for specific countries! Note: Eastern European performance very similar to Central Americans!!
II. What explains this variation? Heterogeneity is related to: * Educational quality at home * Selection effects * Role of Assimilation policies / legal status / language South Asians vs. Western Europeans vs. Latin Americans * No discrimination minimum gap in performance of second generation role of American citizenship laws
III. How does performance evolve over time? Convergence observed for all education levels - both in occupational placement and income Stronger for higher skilled migrants Stronger for those who start behind
IV. How do economic fluctuations affect migrants careers? SIGNIFICANTLY! Bad shocks harm those who made the biggest gains in good times Latin American tertiary educated migrants! Less Damage to migrants from other regions Less Damage to less educated migrants
LESSONS FOR EUROPE: Data, Data, Data Role of Selection / assimilation / language Data, data, data Role of Labor Market Flexibility / mobility
LOCATION OF BIRTH, EDUCATION AND MIGRATION DYNAMICS The case of 20,000 African doctors in the US No detailed data source that tracks all of these variables. Need to rely on different sources and econometrically match them.
Egyptian doctors in the US BORN IN EGYPT ACS TRAINED IN EGYPT AMA 4,867 4,062
Egyptian doctors in the US BORN IN EGYPT TRAINED IN EGYPT 1,339 3,528 534 (25%) (65%) (10%) TOTAL NUMBER OF EGYPTIAN DOCTORS IN THE US: 5,401
Egyptian doctors in the US Trained in another African Country BORN IN EGYPT 37 44 TRAINED IN EGYPT 124 Born in another African Country Born in the United States Trained in the United States 1,077 3,528 Trained in the rest of the world 225 365 Born in the rest of the world 25% of total 65% of total 10% of total
South African doctors in the US BORN IN SOUTH AFRICA TRAINED IN SOUTH AFRICA Trained in another African Country 5 180 Born in another African Country Trained in the United States 726 821 91 Born in the United States Trained in the rest of the world 213 253 Born in the rest of the world 41% of total 36% of total 23% of total TOTAL: 2,289
Age of Migration to the US 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 18 23 28 33 38 43 48 53 Ghana Nigeria South Africa
WHY GO THROUGH THE TROUBLE? We need to be very careful when we talk about skilled migration Not every Egyptian (or Moroccan or Ethiopian or Nigerian) doctor studied at home There are slightly over 20,000 Sub-Saharan + North African doctors in the United States 45% of studied at home 45% studied outside the region two-third in the US! Global human capital markets are more complicated and integrated than we realize. The flows are not uni-directional but form a multidimensional network
Thank You! cozden@worldbank.org http://econ.worldbank.org/research