Germany's immigrant wage gap affects the next generation, study says
international study
published in
Nature
this week revealed the wage gap between
immigrants and native-born populations across Western nations, including in Germany, highlighting the structural barriers which cause this gap to endure across generations.
The multinational team behind the research, including Dr. Malte Reichelt of the Institute for Employment Research (IAB) in Nuremberg, analysed employment and wage information from 13.5 million workers – both immigrants and non-immigrants – in nine high-income countries; Germany, Canada, Denmark, France, the Netherlands, Norway, Spain, Sweden, and the United States.
In Germany, the average wage gap between first-generation immigrants and non-immigrants is 19.6 percent, slightly higher than the average seen across all countries, which was about 18 percent.
Strikingly, three-quarters of the total wage gap was attributed not to immigrants being paid less for the same work, but to having limited access to better-paid jobs, industries, and companies. So the wage gap is largely a result of structural rather than direct discrimination issues, in other words.
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Germany's skilled labour shortage intensifies across industries
Only about 4.6 percent of the wage gap can be ascribed to immigrants being paid less for the same job than native-born employees.
The study's comprehensive data set and multi-country approach confirm that Germany is not unique, but the gap is still among the largest in northern and western Europe, exceeded only by Norway, Spain, and Canada for first-generation migrants.
Multi-generational effects
The wage gap narrows into the second generation but still persists. In Germany, second-generation immigrants earn 7.7 percent less than their peers with native-born parents.
Again the gap in the second generation in Germany is above average for countries in the study, and is even wider for descendants of immigrants from Africa and the Middle East.
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While Germany has long been aware of income disparities affecting immigrants, the study's emphasis on generational persistence and structural factors, rather than just unequal pay for equal work, represents a challenge to assumptions that simply prohibiting wage discrimination will solve the problem.
As Dr. Malte Reichelt notes, 'Integration is not just about equal pay for equal work. It is primarily about breaking down structural barriers to access to well-paid jobs.'
FACT CHECK:
Are immigrants in Germany taking advantage of the welfare state?
In Germany, as in other countries, these structural barriers can include non-recognition of foreign credentials, language barriers, and a lack of professional networks for foreigners.
What do the authors recommend?
Beyond fairness, the findings have major implications for economic growth, especially given Germany's reliance on skilled immigration in an aging society.
Reichelt and his colleagues point to Canada as an example of a country where targeted support programs and the effective use of policy tools have resulted in a much smaller second-generation wage gap.
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According to the study, although Canada's first-generation wage gap is among the largest of any country studied – at 27.5 percent – it shrinks to just 1.9 percent among second-generation immigrants, the smallest gap observed in the comparison countries.
By contrast, Germany's gap narrows from 19.6 percent in the first generation to 7.7 percent in the second, well above Canada's result and the cross-country average of 5.7 percent.
This dramatic narrowing in Canada is attributed by the study's authors to strong integration policies, effective recognition of foreign qualifications, robust language support, and active measures to connect immigrants and their children to well-paid work.
READ ALSO:
How German ministers want to boost skilled migration and integration
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