How do immigrants fare during the downturn? Evidence from matching comparable natives

Background: This paper provides empirical evidence regarding the supposed vulnerability of immigrants to the recent economic downturn. Objective: Our purpose is to understand whether immigrant workers are suffering more from the downturn and, if so, to disentangle whether this is related to being an immigrant or to specific characteristics that make immigrants different from natives. Methods: We use longitudinal data from the Italian Labour Force Survey to compare immigrant and native workers, matched for observable personal, household, and job characteristics by propensity score methods. Results: Immigrant workers face a higher probability of ending an ongoing employment spell because their characteristics are more likely associated with higher separation rates, while, when comparing similar workers, differences with natives disappear. In 2009 job separations increased for all male workers, but the impact was stronger for immigrants, mainly because of their characteristics. On the contrary, both groups of female workers showed a slightly lower probability of losing a job in 2009, so that observed differences remained the same before and after the downturn. Conclusions: The impact of the downturn differs markedly by gender, with only male workers being affected. Among these, immigrants suffer more than natives, as their observable characteristics are more associated with losing a job. When comparing only comparable workers, immigrant status itself has no impact on separation rates.