October 29, 2010

After the Great Recession: Foreign Born Gain Jobs; Native Born Lose Jobs

IV. Earnings of Native-born and Foreign-born Workers

The weekly earnings of workers during the recession and the initial stage of the recovery were generally stagnant.19 However, foreign-born workers experienced a sharp decline in earnings during the recovery even as they managed to boost their employment. Hispanics also did not fare well—their earnings fell for two years in a row—and, among Hispanics, immigrants sustained the biggest cut in wages.

The median weekly earnings of all workers, full time and part time, were $624 in the second quarter of 2008 (earnings expressed in second-quarter 2010 dollars).20 By the end of the recession, in the second quarter of 2009, weekly earnings stood at $623. Earnings nudged upward slightly during the recovery, to $630 in the second quarter of 2010.

In the midst of overall wage stagnation, the earnings of foreign-born workers fell sharply during the recovery. Wages for immigrants did not change much in the recession, moving from $544 in 2008 to $550 in 2009. However, in the recovery from 2009 to 2010, median earnings of foreign-born workers dropped to $525, a loss of 4.5%. The earnings of native-born workers have remained flat during the recession and recovery, starting at $651 in the second quarter of 2008 and ending at $653 in the second quarter of 2010.

Hispanics are the only group of workers whose median earnings decreased during both the recession and the recovery. Starting at $504 in the second quarter of 2008, the median weekly earnings of Latinos fell to $489 in the second quarter of 2009 and then to $480 in the second quarter of 2010.

The downward momentum in earnings for Latinos was led by immigrants. For immigrant Latinos, median weekly earnings dropped from $454 in 2008 to $448 in 2009, and then to $422 in 2010. Over the two-year period, the earnings of immigrant Latinos decreased by 7.0%.

  1. Data on weekly earnings are available only for employed persons. Household income is better able to capture the effects of unemployment on the economic well-being of households. The latest estimate from the Census Bureau shows that median household income was unchanged from 2008 to 2009. The largest decline in income occurred for black households, a group with the highest rate of unemployment, and foreign-born non-citizen households, the group that includes unauthorized immigrants (DeNavas-Walt, Proctor and Smith, 2010).
  2. The median wage divides workers into two equal groups, with half earning more than the median wage and the other half earning less than the median.