Working Paper: CEPR ID: DP18452
Authors: Paul Berbe; Jan Stuhler
Abstract: Germany has become the second-most important destination for migrants worldwide. Using all waves from the microcensus, we study their labor market integration over the last 50 years and highlight differences to the US case. Although the employment gaps between immigrant and native men decline after arrival, they remain large for most cohorts; the average gap after one decade is 10 pp. Conversely, income gaps tend to widen post-arrival. Compositional differences explain how those gaps vary across groups, and why they worsened over time; after accounting for composition, integration outcomes show no systematic trend. Still, economic conditions do matter, and employment collapsed in some cohorts after structural shocks hit the German labor market in the early 1990s. Lastly, we examine the integration of recent arrivals during the European refugee “crisis” and the Russo-Ukrainian war.
Keywords: immigration; labor market integration; long-run trends
JEL Codes: J11; J61; J68
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| economic conditions (E66) | employment outcomes (J68) |
| initial employment gaps (J63) | future outcomes (P17) |
| education, refugee share, regional unemployment rates (I25) | integration trajectories (F15) |
| income gaps (D31) | earnings over time (J31) |
| structural shocks (E32) | immigrant employment (J68) |
| economic conditions at time of arrival (J69) | speed of integration (C69) |
| employment gaps between immigrant and native men (J69) | employment outcomes (J68) |