ABSTRACT
The discussion of assimilation and self-selection centered on the result of the adjustment process—as immigrants acquire the necessary labor market-specific and firm-specific skills, the differentials with native-born workers in earnings and other labor market outcomes diminish or even disappear. The unemployment rate of immigrants is higher than the unemployment rate of native-born workers—in March 1990, the average rate for adult foreign-born men was 6.18%, compared to 4.85% for native-born workers. Human capital and implicit contract hypotheses imply that immigrant unemployment will be more sensitive to cyclical fluctuations; immigrants should be more vulnerable to seasonal cutbacks, although on the aggregate the net effect depends on the proportion of immigrants in typically seasonal industries or occupations. Some important characteristics might lead to higher unemployment duration for immigrants. Non-market time may be actually more productive for immigrants than for youth in acquiring market specific skills, such as through language classes or training workshops.
