Employability and Labor Income of Immigrants in the US: A Special Focus on the Roles of Language and Home Country Income Level

Abstract

Speaking the most-demanded languages is an asset in the labor market. However, coming from a high-income country may give immigrants an advantage in the labor market as those may have more transferable skills. This article investigates the determinants of the employability and labor income of immigrants and newcomer immigrants in the United States (US) labor market, specifically focusing on the role of language and income level of the home country. It applies the Heckman two-step selection procedure to the American Community Survey between 2000 and 2019. The findings show that immigrating from both high-income countries and countries where internationally most widely used languages (English, French, Portuguese, Spanish, and Chinese) are spoken gives immigrants an advantage in the US labor market compared to those from the countries where only national languages are spoken. This article emphasizes the key role of the income level of the home country on immigrants' labor income in the US. It contributes to the literature by employing the interaction terms of being from the same-income-level countries and the same-languages-speaking countries.

JEL classification:  F22, J15, J61

Keywords:  Employability, Foreign language knowledge, Income level of home country, Immigrants, Labor income