Immigration, Working Conditions, and Compensating Differentials

Abstract

The large inflow of less-educated immigrants into the United States in recent decades may have affected US natives’ labor market outcomes in many ways, including their working conditions. Although the general consensus is that low-skilled immigrants tend to hold “worse” jobs than US natives, the impact of immigration on natives’ working conditions has received little attention. This study examines how immigration has affected US natives’ occupational exposure to workplace hazards and the compensating differential paid for such exposure from 1990 to 2018. Results indicate that immigration causes less-educated natives’ exposure to workplace hazards to fall, and instrumental variables results show a larger impact among women than among men. The corresponding compensating differential appears to fall among men, but not after accounting for immigration-induced changes in the financial returns to occupational skills.