Earnings Convergence: Does It Matter Where Immigrants Come from or Why?

Recent immigrants to the US are starting their economic lives at substantially lower earnings than previous cohorts of immigrants. This decline--attributed to high family admissions and changes in the country-of-origin composition of US immigrants--has fostered concerns about the quality of recent immigrants and motivated changes in US immigration law as well as calls for further change. The importance of these concerns depends upon whether immigrants starting with low earnings remain at a disadvantage throughout their working lives. This paper summarizes the research concerning the relationship between immigrant entry earnings and earnings growth and the effect on immigrant earnings growth of kinship admission and country of origin. For cohorts from the same country of origin education group and age group the authors find strong evidence of a systematic inverse relationship between initial earnings and subsequent earnings growth. With regard to the effect of greater admissions on the basis kinship the authors find that declines in admissions on the basis of occupational skills and corresponding increases in admissions on the basis of family are associated with both a decrease in initial earnings and an increase in earnings growth. Finally they find that the importance of country of origin as a determinant of immigrant earnings diminishes with time in the US; the earnings of demographically comparable immigrants regardless of origin converge with time in the US. (authors)