Investigating Migrants’ Labor Market Trajectories: Does Health shock explain the migrant native employment and earnings gap?

Waseem Haider, University of Turku

Existing studies highlight a significant earnings gap between migrants and natives, particularly for non-Western migrants, but rarely examine how health shocks affect migrant earnings. This study uses full population register data and objective health measures to explore how health shocks impact earnings differently across ethnic backgrounds and how earnings trajectories vary by health shock and ethnicity. The study population included individuals aged 25 to 58 living in Finland in 2007. Health status was determined between 2009 and 2010, and earnings were tracked from 2011 to 2018. Individuals were matched by migrant status and health shock within each country group, and growth curve models were used to analyse earnings trajectories. In the unmatched dataset, health shocks reduced earnings for all groups except those from refugee-exporting countries. However, this effect disappeared in the matched sample, suggesting that baseline differences influenced the results. Longer stays in the host country were linked to higher earnings, while mental health conditions were associated with lower earnings. Although the average marginal effect of health shock was not statistically significant in the matched sample, the study found a significantly higher unexplained positive effect of time on the earnings trajectories of individuals without a health shock.

Keywords: Longitudinal studies , International Migration, Multi-level modeling , Economic Demography

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