Understanding Immigrant Job Mobility in the United States

2019-08-06T00:00:00Z (GMT) by Xuening Wang
This dissertation examines the effect of visa status on the job mobility of high-skilled immigrant workers in the United States. One concern regarding current immigration policies is that workers on temporary work visas may be bound to their sponsoring firms in “indentured servitude” with weakened bargaining power and lower wages. Job mobility is known as a crucial mechanism that allows the labor market to enhance the quality of worker-employer matches thereby achieving economic efficiency. However, over the past few decades, the US labor market has undergone a secular slow-down in job-to-job flows. In addition to understanding the institutional constraints on immigrant mobility, this dissertation aims to study more generally how immigrant job mobility patterns may differ from native workers and the potentially reasons behind such differences. Using the National Survey of College Graduates, I first compare the voluntary job-to-job transition patterns of skilled native-born workers with different groups of immigrants by visa type. Given the institutional constraints, I find that temporary professionals are slightly less mobile than comparable US-born workers. Permanent residents and naturalized citizens, however, both have persistent higher probabilities of voluntarily switching employers than their native-born counterparts, thus high-skilled immigration could potentially boost labor market fluidity in the United States. Furthermore, additional empirical evidence supports four hypotheses in explaining the higher immigrant mobility rate: (1) Immigrants have less family ties in the United States; (2) Intra-firm promotions are difficult; (3) General human capital and productivity grow faster among immigrants; (4) Foreign-born workers start their career with reservation wages lower than natives, and better labor market alternatives are therefore more likely in the future. Within the frameworks of individual fixed effects and survival models, I test the presence of institutional mobility restraints by estimating the effect of acquiring US permanent residency on voluntary job mobility and job durations of skilled temporary professionals. I find an immediate upsurge in workers’ voluntary job mobility following receipt of permanent residency. A decomposition analysis indicates that at least 61.2 percent of the spike in mobility is driven by voluntary moving being discouraged during the employer-sponsored green card (permanent residency) application process, as opposed to other barriers. In addition, survival models indicate that a green card shortens job tenure by roughly one year on average. Motivated by the concern that restricted mobility may grant firms monopsony power, consequently leading to inefficiently low wages, I also examine the effect of a green card on worker earnings as well as the role of mobility in explaining such effect. My analysis documents that upon acquiring permanent residency, only male applicants experience an earnings gain — for them, the “green card premium” translates to an 8 percent increase in annual earnings. Finally, I find that a green card generates wage gains among both job movers and stayers, implying that once the job-lock and monopsony power is eliminated, workers are able to obtain higher compensation by either seeking alternative employment opportunities or being promoted within their current firm.