Immigrants’ Economic Assimilation: Evidence from Longitudinal Earnings Records

Abstract

We examine immigrants’ earnings trajectories and measure the extent and speed with which they are able to reduce the earnings gap with natives, using a dataset that links respondents of the Survey of Income and Program Participation (SIPP) to their longitudinal earnings obtained from individual tax records. Our analysis addresses key debates regarding ethnoracial and cohort differences in immigrants’ earnings trajectories. First, we find a racially differentiated pattern of earnings assimilation: black and Hispanic immigrants are less able to catch up with native whites’ earnings compared to white and Asian immigrants, but they are almost able to reach earnings parity with natives of their same race and ethnicity. Second, we find no evidence of a declining “quality” of immigrant cohorts even after controlling for their ethnoracial composition and human capital. Immigrants arriving since 1994 actually experience similar or slightly higher earnings growth compared to immigrants from earlier eras. We identify a pattern of accelerated assimilation in which more educated immigrants experience much of their earnings growth during the first years after arriving.