The Impact of Immigration on Native Workers: A Fresh Look at the Evidence

The debate over the “competition question” of whether immigrants depress wages and displace native workers in the U.S. labor market is a long one. This policy brief provides an overview of research since the mid-1990s studying the impact of immigration on native wages and job displacement, and reviews additional factors that may affect how labor markets adjust to immigrant flows.

While many earlier studies indicate that immigration has little to no impact on the wages of natives, the brief finds that recent scholarship on wage impacts has been divergent. Some studies have shown substantial negative wage effects, particularly among Black workers and natives in occupations with large shares of Latino immigrants; other studies suggest that complementarities between high-skilled immigrants and similarly skilled natives, as well as between low-skilled immigrants and more highly skilled native workers, contribute to higher wages for the U.S. born. Studies examining other factors that potentially mitigate wage and employment impacts, such as the out-migration or upward mobility of natives and changes in the way local labor markets and businesses absorb immigrant workers, also appear to lack consensus.

On the other hand, recent literature on job displacement consistently links immigration to at least some level of job displacement among natives and the growing exclusion of native workers from certain industries. However, the brief raises concern over the narrow focus of these studies. With the competition question still largely up for debate, the authors caution that wage and employment concerns should be viewed as only one of many ways to look at the complex picture of immigrants, their contributions, and their costs in the United States.