NCPA - National Center for Policy Analysis


January 4, 2006

The population of Mexican-born persons residing in the United States has increased at an unprecedented rate in recent decades. According to a paper from the National Bureau of Economic Research, this is contributing to a widening gap in the U.S. wage structure.

According to authors George Borjas and Lawrence Katz, both Mexican immigrants and native workers of Mexican descent face wage disadvantages:

  • Mexican immigrants have much less education than either native-born workers or non-Mexican immigrants.
  • While the earnings of non-Mexican immigrants converge to approximate those of their native-born counterparts as the immigrants accumulate U.S. work experience, the convergence has been weaker on average for Mexican immigrants than for other immigrant groups.
  • Although native-born workers of Mexican ancestry have levels of human capital and earnings that far exceed those of Mexican immigrants, the economic performance of these native-born workers lags behind that of native workers who are not of Mexican ancestry.

The authors also find that the large Mexican influx in recent decades has contributed to the widening of the U.S. wage structure by adversely affecting the earnings of less-educated native workers and improving the earnings of college graduates. These wage effects have, in turn, lowered the prices of non-traded goods and services that are low-skill labor intensive.

Source: Les Picker, "The Evolution of the Mexican Workforce in the United States," NBER Digest, December 2005; based upon: George Borjas and Lawrence Katz, "The Evolution of the Mexican-Born Workforce in the United States," National Bureau of Economic Research, Working Paper No. 11281, April 2005.

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