Ethnic Minorities In The Labour Market Notes

What explains ethnic minority disadvantage in the labour market?

In this piece I focus on the reasons for disadvantage in the labour market of children of immigrants from non-european nations to industrialised countries. This is because at least some of the major reasons for first generation migrants’ disadvantage, such as poor language skill and, initially at least, material deprivation, are obvious. I focus on those of non-european origin because, with a few exceptions, the labour market positions of those of european origin are, by the second generation, quite similar to the charter population. I also mostly focus on what some have termed the ‘ethnic penalty’ that is, the disadvantage these groups experience in labour market outcomes after controlling for observables such as education and social class origin. I do this because, if these controls are not applied, then our explanations will often borrow heavily from more general explanations of stratification and social class reproduction, to the extent that I would not really be offering specific analyses the disadvantages felt by the groups in question. However, I do finish with a brief argument against focusing exclusively on the ethnic penalty as it is currently conceived. There are, as I see it, three distinct puzzles, in this field. The first is why, in some countries, the ethnic penalty is felt in relation to unemployment risk but not in relation to access to the salariat risk, and why in some countries an ethnic penalty operates on both measures. The second is why so-called ‘involuntary minorities’ such as the indigenous in Canada, seem to have worse outcomes than other minorities. The third puzzle is the cross-national differences in the general magnitude of the ethnic penalty, which seems to be the case even when looking at minorities from the same country’s experiences in different countries. This third puzzle, which is perhaps the most fundamental, informs answers to debates about assimilation: will the descendants of newer migrants’ socioeconomic positions ultimately resemble those of the charter population, or, as some theories of ‘segmented assimilation’ suggest, will (at least some of) these minorities more or less permanently join a socioeconomic underclass? Explanations for the extent of the ethnic penalty in industrialised nations can be grouped into two classes. The first class of explanations are macrosocietal explanations about phenomena like the apparent bifurcation of industrialised economies’ labour markets, and the overall rate of unemployment. The second class focus on minorities themselves, and the different incidence of phenomena like prejudice across minorities and societies, as well as the impact of policy on migration and citizenship. It is on this second class of explanations that I will focus. My intent is not to solve any of the three puzzles identified above, but to argue that the latter class of explanations are, despite their intuitive appeal, poorly developed. My arguments can be thought of as falling into three categories. Firstly, I raise doubts about the project of relating prejudice in the aggregate to minorities’ labour market disadvantage, and even suggest the effect could be in the opposite direction to that which is commonly expected. Secondly, I argue audit studies are less informative than is thought, and thirdly, I suggest that narrowing our focus to ‘ethnic penalties’ by controlling for education is more complex and problematic than is usually realised..

Heath and Yu, in their conclusion to a major cross-national study of ethnic disadvantage in the labour market, finds that, after conducting a bivariate analysis of ethnic versus civic conceptions of the nation and ethnic penalties with respect to unemployment (I raise some doubts about the project of narrowing our focus to ethnic penalties below), ‘if anything the relationship is in the wrong direction’¹. He speculates that other subjective measures of charter populations’ attitudes towards minorities might yield a ‘better’ result, but (whilst an empirical analysis of the impact of such attitudes is obviously beyond me here) I doubt this for several reasons. Firstly, aggregate measures of prejudice are too crude for this question. What is perhaps needed is a focus on the incidence of these sorts of beliefs amongst those in a position to make hiring decisions. Part of the reason for that is obvious - there is no obvious reason why a white person in a low status occupation can directly affect the odds of an ethnic minority accessing the salariat or avoiding unemployment. Furthermore, it is widely recognised that racist beliefs are more prevalent amongst lower status whites², who are clearly less likely to be in a position to hire. But even if a more focused analysis of the sort suggested above yielded positive results, the direction of causality is questionable. It may be that high rates of unemployment amongst certain minorities (and the consequences thereof, such as being in receipt of welfare) affect the evaluations charter populations make of minorities’ suitability for work and other characteristics.

The other problem for advocates of causally relating aggregate levels of negative attitudes towrds minorities to labour market outcomes for minorities is that, insofar as prejudice informs policy on migration, it probably make minorities more advantaged in the labour market by affecting selection. Stricter migration policies, such as insisting on migrants having certain qualifications or material resources, which might, as Facchini³ argues conceivably arise from policymakers attempting to appease prejudiced voters, will lead, all else equal, to migrants with an enhanced capacity to succeed in the...

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