The Rise and Fall of Immigrant Employment: A Lifecycle Study of Labor Migrants to Norway
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Bratsberg, Bernt, Oddbjørn Raaum, and Knut Røed
We find that the lifecycle employment profiles of nonwestern male labor migrants that came to Norway in the early 1970s diverge significantly from those of native comparison persons. During the first years after arrival almost all of the immigrants worked and their employment rate exceeded that of natives. But, about ten years upon arrival, immigrant employment started a sharp and steady decline. By 2000, the immigrant employment rate was 50 percent, compared to 87 percent for the native comparison group. That year, as many as 74 percent of the non-employed immigrants received a permanent disability pension and an additional 16 percent received another form of social security transfer. We identify considerable disincentives embedded in the social security system that may be responsible for the poor lifecycle employment performance of the immigrant cohort. But we also uncover evidence that labor immigrants are particularly vulnerable to the state of the economy and face a high probability of permanent exit from the labor market during economic downturns.
Project:Oppdragsgiver: Arbeids- og sosialdepartementet og Finansdepartementet
Frisch prosjekt: 1391 - Strategic Institute Program on Labor Market and Pension Research
The Ministry of Labour and Social Inclusion and the Ministry of Finance and the World Bank Research Program on International Migration and Development.