Being Employed by a Co-national: A Cul-de-sac or a Short Cut to the Main Road of the Labour Market?

• This paper analyses the impact of working in an ethnic economy on subsequent labour market performance for newly arrived immigrants. Is it a short cut to the labour market or does it lock immigrants into low income jobs? Working in an ethnic economy is defined as being employed by a self-employed co-national. The comparison group is a matched sample of newly arrived immigrants who were without employment during the same period. Swedish panel data for the period 1998–2005 are used, and the sample is restricted to male immigrants, 20–55 years of age. Using propensity score matching, we find that immigrants who were employed by self-employed co-nationals are more likely to be employed in the near future, but that the types of employment they have are associated with lower incomes. Many continue to be employed by self-employed co-nationals or become self-employed themselves.

Subject headings

SAMHÄLLSVETENSKAP  -- Ekonomi och näringsliv -- Nationalekonomi (hsv//swe)

SOCIAL SCIENCES  -- Economics and Business -- Economics (hsv//eng)

Publication and Content Type

ref (subject category)

art (subject category)