Impact of immigrant workers on a regional labour market

This article analyses the ability of a regional labour market to absorb growing flows of immigrant workers with declining levels of skills in relatively high unemployment times. In the short-run, unemployment increases with larger immigration flows, however, in the longer run, unemployment is permanently lowered. The level as well as the composition of skills of immigrant workers matter. Increasing the discrepancy between the skill distribution of immigrants and that of the existing workforce is desirable to mitigate some of the adverse effects on unemployment in the short run as both types of labour appear to be complement. Strengthening the existing screening system for immigrant candidates is then a possibility.