Date of Completion

4-11-2012

Embargo Period

4-5-2013

Open Access

Campus Access

Abstract

In this paper, I examine the impacts of immigration and local labor market characteristics on earnings inequality among full-time year-round workers in micropolitan areas in the United States for the years 2006-2008. Micropolitan areas are essentially small town communities with populations between 10,000 and 50,000 located outside metropolitan areas. Micropolitan areas have increasingly become new immigrant destinations (Wahl et al 2007); however, the impact of immigration on new small town destinations has not been thoroughly explored. Drawing upon previous research on new destinations and immigration and stratification in urban and metropolitan areas, I focus on the impacts of different citizen and non-citizen immigrants on earnings inequality in these micropolitan areas given the industrial characteristics, the geographic characteristics, and the types of employment of these areas. I find that the percent foreign-born in these small towns is associated with greater earnings inequality and mixed support that this relationship is primarily driven by non-citizen immigrants (new immigrants). These findings are consistent with dual labor market theory and previous research on immigration to small towns (Piore 1979; Kandel and Parrado 2005) suggesting that many immigrants to small towns are funneled into industries that are undesirable to natives and exploit them for lower wages, which in turn increases earnings inequality. I also find that foreign-born non-citizens primarily impact inequality because they are associated with lower earnings for the average full-time worker relative to the poorest and richest workers. This finding suggests that immigrants tend occupy average-paying jobs with lower pay relative to native workers. Implicit in this analysis is the assumption that immigration impacts earnings inequality; however, future analyses will further examine the direction of causality in the relationship. Further, these findings suggest that there might be a lack of opportunity for immigrant incorporation in these new small town destinations.

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