Immigration, Internal Migration, and Local Labor Market Adjustment During the Great Recession

Brian Cadena, Assistant Professor of Economics, University of Colorado-Boulder, will present "Immigration, Internal Migration, and Local Labor Market Adjustment During the Great Recession" as part of the Demography Workshop, February 14, 2012.

This paper uses geographic variation in the severity of the Great Recession to examine the effect of local demand conditions on migration. Consistent with the existing literature, we find large differences by skill group. High-skilled natives are quite responsive to employment opportunities whereas low-skilled natives’ location choices are essentially unaffected by the distribution of local demand shocks. In sharp contrast to the results for natives, we find that low-skilled immigrants, primarily those born in Mexico, respond strongly, with elasticities similar to those of high-skilled workers. These results are robust to the inclusion of controls for immigrant diffusion, local policies directed at immigrants, and an examination of pre-recession trends. We also address the endogeneity of local demand to immigrant locations using an instrumental variables strategy. Finally, we find that this geographic redistribution of low-skilled Mexicans operated primarily though internal migration within the U.S. and through slower immigration rates from Mexico to cities with larger demand declines.

Brian C. Cadena, PhD, is an Assistant Professor of Economics at the University of Colorado – Boulder. Dr. Cadena’s research focuses on the mobility of workers in response to labor market prospects, the effects of government policies on the labor market, and the intersection of behavioral economics and the economics of education. His work has been supported by grants from the Russell Sage Foundation and the University of Kentucky Center for Poverty Research. Dr. Cadena’s research has been published in peer-reviewed journals including the Review of Economics and Statistics and the Journal of Human Resources.

The weekly Demography Workshop series is held every Thursday from 12:00 – 1:20 p.m. at NORC at the University of Chicago in seminar room 232/233, located in the Harris School of Public Policy Studies at 1155 East 60th Street.

For more information on the Demography Workshop series, visit the Population Research Center site.