IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp17444.html
   My bibliography  Save this paper

Lifting Barriers to Skill Transferability: Immigrant Integration through Occupational Recognition

Author

Listed:
  • Anger, Silke

    (Institute for Employment Research (IAB), Nuremberg)

  • Bassetto, Jacopo

    (University of Bologna)

  • Sandner, Malte

    (Technische Hochschule Nürnberg)

Abstract

While Western countries worry about labor shortages, their institutional barriers to skill transferability prevent immigrants from fully utilizing foreign qualifications. Combining administrative and survey data in a difference-in-differences design, we show that a German reform, which lifted these barriers for non-EU immigrants, led to a 15 percent increase in the share of immigrants with a recognized foreign qualification. Consequently, non-EU immigrants' employment and wages in licensed occupations (e.g., doctors) increased respectively by 18.6 and 4 percent, narrowing the gaps with EU immigrants. Despite the inflow of non-EU immigrants in these occupations, we find no evidence of crowding out or downward wage pressure for natives.

Suggested Citation

  • Anger, Silke & Bassetto, Jacopo & Sandner, Malte, 2024. "Lifting Barriers to Skill Transferability: Immigrant Integration through Occupational Recognition," IZA Discussion Papers 17444, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp17444
    as

    Download full text from publisher

    File URL: https://docs.iza.org/dp17444.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Christian Dustmann & Albrecht Glitz & Uta Schönberg & Herbert Brücker, 2016. "Referral-based Job Search Networks," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 83(2), pages 514-546.
    2. repec:ces:ifosdt:v:75:y:2022:i:10:p:70 is not listed on IDEAS
    3. Andreas Beerli & Jan Ruffner & Michael Siegenthaler & Giovanni Peri, 2021. "The Abolition of Immigration Restrictions and the Performance of Firms and Workers: Evidence from Switzerland," American Economic Review, American Economic Association, vol. 111(3), pages 976-1012, March.
    4. Maury Gittleman & Mark A. Klee & Morris M. Kleiner, 2018. "Analyzing the Labor Market Outcomes of Occupational Licensing," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 57(1), pages 57-100, January.
    5. Christoph Albert & Albrecht Glitz & Joan Llull, 2021. "Labor Market Competition and the Assimilation of Immigrants," Working Papers 1280, Barcelona School of Economics.
    6. Alison L. Booth & Marco Francesconi & Jeff Frank, 2002. "Temporary Jobs: Stepping Stones Or Dead Ends?," Economic Journal, Royal Economic Society, vol. 112(480), pages 189-213, June.
    7. Sari Pekkala Kerr & William R. Kerr & William F. Lincoln, 2015. "Skilled Immigration and the Employment Structures of US Firms," Journal of Labor Economics, University of Chicago Press, vol. 33(S1), pages 147-186.
    8. Scott R. Baker & Andrey Fradkin, 2017. "The Impact of Unemployment Insurance on Job Search: Evidence from Google Search Data," The Review of Economics and Statistics, MIT Press, vol. 99(5), pages 756-768, December.
    9. Christian Dustmann & Uta Schönberg & Jan Stuhler, 2017. "Labor Supply Shocks, Native Wages, and the Adjustment of Local Employment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 132(1), pages 435-483.
    10. Koumenta, Maria & Pagliero, Mario & Rostam-Afschar, Davud, 2022. "Occupational Regulation, Institutions, and Migrants’ Labor Market Outcomes," Labour Economics, Elsevier, vol. 79(C).
    11. George J. Borjas, 2021. "The Slowdown in the Economic Assimilation of Immigrants: Aging and Cohort Effects Revisited Again," World Scientific Book Chapters, in: Foundational Essays in Immigration Economics, chapter 3, pages 31-65, World Scientific Publishing Co. Pte. Ltd..
    12. Kirk Doran & Alexander Gelber & Adam Isen, 2022. "The Effects of High-Skilled Immigration Policy on Firms: Evidence from Visa Lotteries," Journal of Political Economy, University of Chicago Press, vol. 130(10), pages 2501-2533.
    13. Jérôme Adda & Christian Dustmann & Joseph-Simon Görlach, 2022. "The Dynamics of Return Migration, Human Capital Accumulation, and Wage Assimilation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 89(6), pages 2841-2871.
    14. Friedberg, Rachel M, 2000. "You Can't Take It with You? Immigrant Assimilation and the Portability of Human Capital," Journal of Labor Economics, University of Chicago Press, vol. 18(2), pages 221-251, April.
    15. Susan Dynarski & CJ Libassi & Katherine Michelmore & Stephanie Owen, 2021. "Closing the Gap: The Effect of Reducing Complexity and Uncertainty in College Pricing on the Choices of Low-Income Students," American Economic Review, American Economic Association, vol. 111(6), pages 1721-1756, June.
    16. Lochmann, Alexia & Rapoport, Hillel & Speciale, Biagio, 2019. "The effect of language training on immigrants’ economic integration: Empirical evidence from France," European Economic Review, Elsevier, vol. 113(C), pages 265-296.
    17. Tani, Massimiliano, 2017. "Local signals and the returns to foreign education," Economics of Education Review, Elsevier, vol. 61(C), pages 174-190.
    18. Ole Agersnap & Amalie Jensen & Henrik Kleven, 2020. "The Welfare Magnet Hypothesis: Evidence from an Immigrant Welfare Scheme in Denmark," American Economic Review: Insights, American Economic Association, vol. 2(4), pages 527-542, December.
    19. Rebecca Lessem & Carl Sanders, 2020. "Immigrant Wage Growth In The United States: The Role Of Occupational Upgrading," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 61(2), pages 941-972, May.
    20. Alexander Patt & Jens Ruhose & Simon Wiederhold & Miguel Flores, 2021. "International Emigrant Selection on Occupational Skills," Journal of the European Economic Association, European Economic Association, vol. 19(2), pages 1249-1298.
    21. Henning Hermes & Philipp Lergetporer & Frauke Peter & Simon Wiederhold, 2021. "Application Barriers and the Socioeconomic Gap in Child Care Enrollment," CESifo Working Paper Series 9282, CESifo.
    22. Dan Anderberg & Helmut Rainer & Fabian Siuda, 2022. "Quantifying domestic violence in times of crisis: An internet search activity‐based measure for the COVID‐19 pandemic," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 185(2), pages 498-518, April.
    23. Adriana D. Kugler & Robert M. Sauer, 2005. "Doctors without Borders? Relicensing Requirements and Negative Selection in the Market for Physicians," Journal of Labor Economics, University of Chicago Press, vol. 23(3), pages 437-466, July.
    24. Lutz Hendricks & Todd Schoellman, 2018. "Human Capital and Development Accounting: New Evidence from Wage Gains at Migration," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 133(2), pages 665-700.
    25. Herbert Brücker & Albrecht Glitz & Adrian Lerche & Agnese Romiti, 2021. "Occupational Recognition and Immigrant Labor Market Outcomes," Journal of Labor Economics, University of Chicago Press, vol. 39(2), pages 497-525.
    26. Christian Dustmann & Tommaso Frattini & Ian P. Preston, 2013. "The Effect of Immigration along the Distribution of Wages," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 80(1), pages 145-173.
    27. Maarten Goos & Alan Manning & Anna Salomons, 2014. "Explaining Job Polarization: Routine-Biased Technological Change and Offshoring," American Economic Review, American Economic Association, vol. 104(8), pages 2509-2526, August.
    28. Mette Foged & Linea Hasager & Giovanni Peri, 2024. "Comparing the Effects of Policies for the Labor Market Integration of Refugees," Journal of Labor Economics, University of Chicago Press, vol. 42(S1), pages 335-377.
    29. Caroline M. Hoxby & Sarah Turner, 2015. "What High-Achieving Low-Income Students Know about College," American Economic Review, American Economic Association, vol. 105(5), pages 514-517, May.
    30. Mattoo, Aaditya & Neagu, Ileana Cristina & Özden, Çaglar, 2008. "Brain waste? Educated immigrants in the US labor market," Journal of Development Economics, Elsevier, vol. 87(2), pages 255-269, October.
    31. Battisti, Michele & Giesing, Yvonne & Laurentsyeva, Nadzeya, 2019. "Can job search assistance improve the labour market integration of refugees? Evidence from a field experiment," Labour Economics, Elsevier, vol. 61(C).
    32. Agostina Brinatti & Nicolas Morales, 2021. "Firm Heterogeneity and the Impact of Immigration: Evidence from German Establishments," Working Paper 21-16, Federal Reserve Bank of Richmond.
    33. Yann Algan & Christian Dustmann & Albrecht Glitz & Alan Manning, 2010. "The Economic Situation of First and Second-Generation Immigrants in France, Germany and the United Kingdom," Economic Journal, Royal Economic Society, vol. 120(542), pages 4-30, February.
    34. Saurabh Bhargava & Dayanand Manoli, 2015. "Psychological Frictions and the Incomplete Take-Up of Social Benefits: Evidence from an IRS Field Experiment," American Economic Review, American Economic Association, vol. 105(11), pages 3489-3529, November.
    35. Doran, Kirk & Gelber, Alexander & Isen, Adam, 2022. "The Effects of High-Skilled Immigration Policy on Firms: Evidence from Visa Lotteries," University of California at San Diego, Economics Working Paper Series qt4m50h88v, Department of Economics, UC San Diego.
    36. repec:iab:iabfda:201904(en is not listed on IDEAS
    37. Renato Faccini, 2014. "Reassessing Labour Market Reforms: Temporary Contracts as a Screening Device," Economic Journal, Royal Economic Society, vol. 124(575), pages 167-200, March.
    38. Albrecht Glitz, 2012. "The Labor Market Impact of Immigration: A Quasi-Experiment Exploiting Immigrant Location Rules in Germany," Journal of Labor Economics, University of Chicago Press, vol. 30(1), pages 175-213.
    39. Kaivan Munshi, 2003. "Networks in the Modern Economy: Mexican Migrants in the U. S. Labor Market," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(2), pages 549-599.
    40. repec:hal:spmain:info:hdl:2441/536kq4edtr82jqovubq3ttobc5 is not listed on IDEAS
    41. Pernilla Andersson Joona & Lena Nekby, 2012. "Intensive Coaching of New Immigrants: An Evaluation Based on Random Program Assignment," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(2), pages 575-600, June.
    42. Eric P. Bettinger & Bridget Terry Long & Philip Oreopoulos & Lisa Sanbonmatsu, 2012. "The Role of Application Assistance and Information in College Decisions: Results from the H&R Block Fafsa Experiment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(3), pages 1205-1242.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Paul Berbée & Jan Stuhler, 2023. "The Integration of Migrants in the German Labor Market: Evidence over 50 Years," RF Berlin - CReAM Discussion Paper Series 2315, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    2. Regina T. Riphahn & Irakli Sauer, 2024. "Earnings Assimilation of Post-Reunification East German Migrants in West Germany," CESifo Working Paper Series 11233, CESifo.
    3. Herbert Brücker & Albrecht Glitz & Adrian Lerche & Agnese Romiti, 2021. "Occupational Recognition and Immigrant Labor Market Outcomes," Journal of Labor Economics, University of Chicago Press, vol. 39(2), pages 497-525.
    4. Dustmann, Christian & Glitz, Albrecht, 2011. "Migration and Education," Handbook of the Economics of Education, in: Erik Hanushek & Stephen Machin & Ludger Woessmann (ed.), Handbook of the Economics of Education, edition 1, volume 4, chapter 0, pages 327-439, Elsevier.
    5. Rosso, Anna, 2019. "Emigrant selection and wages: The case of Poland," Labour Economics, Elsevier, vol. 60(C), pages 148-175.
    6. Abdulla, Kanat, 2020. "Human capital accumulation: Evidence from immigrants in low-income countries," Journal of Comparative Economics, Elsevier, vol. 48(4), pages 951-973.
    7. Hannah Illing, 2023. "Crossing Borders: Labor Market Effects of European Integration," ECONtribute Discussion Papers Series 221, University of Bonn and University of Cologne, Germany.
    8. Christian Dustmann & Hyejin Ku & Tetyana Surovtseva, 2024. "Real Exchange Rates and the Earnings of Immigrants," The Economic Journal, Royal Economic Society, vol. 134(657), pages 271-294.
    9. Silliman, Mikko & Willén, Alexander, 2024. "Worker Power, Immigrant Sorting, and Firm Dynamics," Discussion Paper Series in Economics 13/2024, Norwegian School of Economics, Department of Economics.
    10. Agostina Brinatti & Xing Guo, 2023. "Third-Country Effects of U.S. Immigration Policy," Staff Working Papers 23-60, Bank of Canada.
    11. Laurent Bossavie & Daniel Garrote‐Sanchez & Mattia Makovec & Çağlar Özden, 2022. "Do immigrants shield the locals? Exposure to COVID‐related risks in the European Union," Review of International Economics, Wiley Blackwell, vol. 30(5), pages 1478-1514, November.
    12. Illing, Hannah, 2023. "Crossing Borders: Labor Market Effects of European Integration," IZA Discussion Papers 15930, Institute of Labor Economics (IZA).
    13. Berbée, Paul & Brücker, Herbert & Garloff, Alfred & Sommerfeld, Katrin, 2022. "The labor demand effects of refugee immigration: Evidence from a natural experiment," ZEW Discussion Papers 22-069, ZEW - Leibniz Centre for European Economic Research.
    14. Sharpe, Jamie & Bollinger, Christopher R., 2020. "Who competes with whom? Using occupation characteristics to estimate the impact of immigration on native wages," Labour Economics, Elsevier, vol. 66(C).
    15. Engdahl, Mattias & Willis, Sébastien & Åslund, Olof, 2024. "Professional networks and the labour market assimilation of immigrants," Working Paper Series 2024:9, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    16. Edo, Anthony & Rapoport, Hillel, 2019. "Minimum wages and the labor market effects of immigration," Labour Economics, Elsevier, vol. 61(C).
    17. Sari Pekkala Kerr & William R. Kerr, 2021. "Whose Job Is It Anyway? Coethnic Hiring in New US Ventures," Journal of Human Capital, University of Chicago Press, vol. 15(1), pages 86-127.
    18. Karadja, Mounir & Sundberg, Anton, 2023. "The labor market impact of a taxi driver’s license," Working Paper Series 2023:6, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    19. Jacob Nielsen Arendt & Christian Dustmann & Hyejin Ku, 2022. "Refugee migration and the labour market: lessons from 40 years of post-arrival policies in Denmark," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 38(3), pages 531-556.
    20. Edo Anthony, 2015. "The Impact of Immigration on Native Wages and Employment," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 15(3), pages 1151-1196, July.

    More about this item

    Keywords

    skill transferability; occupational recognition; immigrant integration;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp17444. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.