Do Country-Specific Skills Lead to Improved Labor Market Positions?

The gap in labor market rewards between immigrants and the native born is sometimes explained with reference to immigrants' lack of country-specific skills. This study investigates whether speaking and understanding Swedish well, having an education obtained in Sweden, and living with a Swedish partner improve immigrants' position in the labor market. The findings show that these characteristics do not substantially reduce the risk of unemployment, and the risk remains clearly above the level of native-born Swedes. However, employed immigrants with a Swedish education and very good language skills are as likely as Swedes to be educationally overqualified for their job. In sum, country-specific skills are helpful in the process of reward attainment but do not go all the way in accounting for the labor market disadvantage of immigrants. The residual may be due to discrimination.