levels are far below those in the United States. Part of this growing wage gap may stem from the influx of illegal immigrants, but there is also evidence of a growing gap among legal immigrants. With time spent in the United States, the wage gap narrows for some—significantly for immigrants from Europe and Asia, and at least modestly for some others—but not at all for those from Mexico.
Employment rates of recent immigrants have also fallen relative to those of natives. However, immigrants catch up to natives relatively quickly on this dimension, so that their employment rates are quite similar to those of natives after some years in the United States.
A higher proportion of immigrants than of the native-born work in many jobs that call for high levels of education—they are college teachers, medical scientists, economists. But they are even more disproportionately represented in many of the lowest-paying jobs: waiters and waitresses, agricultural graders and sorters, private household workers. Immigrants also account for a disproportionate number of workers in many occupations that require little education but much skill, such as tailors and jewelers.
Potentially, immigration could have large effects on certain parts of the labor market—workers in geographic areas that receive large numbers of immigrants or those with low levels of education. However, the evidence on local labor markets shows only a weak relationship between native wages and the number of immigrants. This evidence also indicates that the numerically weak relationship between native wages and immigration is observed across all types of native workers, skilled and unskilled, male and female, and black and white. Ironically, the one group that appears to suffer substantially from new waves of immigrants are immigrants from earlier waves.
However, the weak observed relationship between native wages and immigration may be due to problems with this approach. If native workers and firms respond to the entry of immigrants by moving to areas offering better opportunities, the wages of all competing native workers fall, not just the wages of natives working in the cities where immigrants cluster. But in this case, because immigration generates only small changes in aggregate labor supply, wage changes will be relatively small.
Looking in particular at workers with low levels of education, over the 1980s immigration was partly responsible for increasing the supply of high school dropouts by 15 percent relative to the supply of workers with at least a high school diploma. Based on an alternative approach using previous estimates of wage responses to changes in supply, the supply increase due to immigration could account for about 44 percent of the total decline in the relative wage of high school dropouts that was observed between 1980 and 1994.
The evidence points to the conclusion that there is only a small adverse impact of immigration on the wage and employment opportunities of competing native groups. This effect does not appear to be concentrated in the local areas where immigrants live, but instead is dispersed across the United States. This