Immigrant–native pay gap driven by lack of access to high-paying jobs

Are Skeie Hermansen (), Andrew Penner, István Boza, Marta M. Elvira, Olivier Godechot, Martin Hällsten, Lasse Folke Henriksen, Feng Hou, Zoltán Lippényi, Trond Petersen, Malte Reichelt, Halil Sabanci, Mirna Safi, Donald Tomaskovic-Devey and Erik Vickstrom
Additional contact information
Are Skeie Hermansen: University of Oslo
Andrew Penner: University of California, Irvine
István Boza: HUN-REN Centre for Economic and Regional Studies
Marta M. Elvira: University of Navarra
Olivier Godechot: CNRS
Martin Hällsten: Stockholm University
Lasse Folke Henriksen: Copenhagen Business School
Feng Hou: Statistics Canada
Zoltán Lippényi: University of Groningen
Trond Petersen: University of California, Berkeley
Malte Reichelt: University of Erlangen-Nuremberg
Halil Sabanci: Frankfurt School of Finance and Management
Mirna Safi: CNRS
Donald Tomaskovic-Devey: University of Massachusetts Amherst
Erik Vickstrom: United States Census Bureau

Nature, 2025, vol. 644, issue 8078, 969-975

Abstract: Abstract Immigrants to high-income countries often face considerable and persistent difficulties in the labour market1–6, whereas their native-born children typically experience economic progress6–9. However, little is known about the extent to which these immigrant–native earnings differences stem from unequal pay when doing the same work for the same employer versus labour market processes that sort immigrants into lower-paid jobs. Here, using data from nine European and North American countries, we show that the segregation of workers with immigrant backgrounds into lower-paying jobs accounts for about three-quarters of overall immigrant–native earnings differences. Although within-job pay inequality remains notable for immigrants in several countries, our results demonstrate that unequal access to higher-paying jobs is the primary driver of the immigrant–native pay gap across a range of institutionally and demographically diverse contexts. These findings highlight the importance of policies aimed at reducing between-job segregation, such as language training10–13, job training13–15, job search assistance programmes13,15, improving access to domestic education13,16,17, recognizing foreign qualifications18,19, and settlement programmes aimed at enhancing access to job-relevant information and networks13,20,21. Policies that target employer bias in hiring and promotion decisions are also likely to be effective, whereas measures aimed at ensuring equal pay for equal work may have more limited scope for further progress in closing the immigrant–native pay gap22–28.

Date: 2025
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DOI: 10.1038/s41586-025-09259-6

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