How Do Low-Skilled Immigrants Adjust to Chinese Import Shocks? Evidence Using English Language Proficiency

Delia Furtado and Haiyang Kong

No 14152, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper examines the link between trade-induced changes in local labor market opportunities and English language fluency rates among low-skilled immigrants in the United States. Many of the production-based manufacturing jobs lost in recent years due to Chinese import competition did not require strong English-speaking skills while many of the jobs in expanding industries, mostly in the service sector, did. Consistent with responses to these changing labor market opportunities, we find that a $1,000 increase in import exposure per worker in a local area led to an increase in the share of low-skilled immigrants speaking English very well in that area by about half a percentage point. As evidence that at least part of this is a result of actual improvements in English language speaking abilities, we show that low-skilled immigrants in trade-impacted areas became especially likely to be enrolled in school compared to similarly low-skilled natives. However, while we find little support for selective domestic migration in response to trade shocks, we present evidence suggesting that new immigrants arriving from abroad choose where to settle based either on their English fluency or their ability to learn English. Regardless of whether low-skilled immigrants respond to trade shocks via actual improvements in English fluency or migration choices, our results suggest that immigrants help to equilibrate labor markets, an implication we find evidence for in the data.

Keywords: immigrant assimilation; import competition; language fluency; immigrants (search for similar items in EconPapers)
JEL-codes: F16 J15 J24 J61 (search for similar items in EconPapers)
Pages: 64 pages
Date: 2021-02
New Economics Papers: this item is included in nep-int, nep-lab, nep-mig and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published - published in: European Economic Review, 2024, 163, 104681

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