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Labour Market Disadvantages For Black Immigrants And Black Natives In The UK

Black immigrants to the UK earn less than similarly qualified black natives, who themselves earn less than white natives. For example, on arrival in the UK, a West Indian immigrant with ten years foreign work experience can expect to earn 28% less than a similarly qualified black native. By the end of their working life, this gap will have fallen to 11%. These are some of the findings of Brian Bell of Nuffield College, Oxford, in research on the success of immigrants in the UK labour market published in the latest issue of the Economic Journal.

Bell notes that the growing number of immigrants in the UK has occasioned much debate in political circles but has been largely ignored in the economics literature. His research shows that:

• Since the 1960s, there has been a precipitous decline in the number of immigrants coming from Ireland and the Old Commonwealth. The increases in immigration in the 1960s and 1970s came from the Indian subcontinent, East Africa and the Caribbean.
• Immigrants as a whole have on average 1.1 more years of schooling than native British. What''s more, this education gap has been rising as successive cohorts have entered the UK. The gap is particularly large for Indian immigrants. Unsurprisingly, much of the change over time is explained by the changes in the national origins of immigrants.
• Black immigrants earn less than similarly qualified black natives, who themselves earn less than white natives. Much of this wage disadvantage is because employers seem to reward foreign labour market experience and education less than domestic experience and education.
• But as the length of time spent in the UK increases, the gap between black immigrants and natives shrinks as the immigrants become more familiar with the UK labour market and develop skills relevant to that market. Nevertheless, the gap will remain for their entire working lives. Interestingly, immigrants who arrive in the UK before they begin their working lives do not suffer these wage gaps.
• White immigrants experience no wage penalty in the labour market and there is no evidence that they receive a lower return to experience and education than white natives.

Bell's analysis was conducted using the General Household Surveys (GHS). This is the only annual survey that contains detailed information on the wages and education of immigrants going back to the beginning of the 1970s. The Office of National Statistics has recently announced the suspension of the GHS, claiming that other surveys can cover the same information. Bell argues that this is simply incorrect and that the suspension of the GHS will seriously hamper future research into immigrants in the UK.

''The Performance of Immigrants in the United Kingdom: Evidence from the General Household Surveys (GHS)'' by Brian Bell is published in the March 1997 issue of the Economic Journal. Bell is a Research Fellow at Nuffield College, Oxford. Material from the GHS was made available through the Economic and Social Research Council Data Archive.