March 21, 2012

The Demographics of the Jobs Recovery

III. The Economic Recovery for Native-born and Foreign-born Workers

Foreign-born workers are experiencing a faster rate of growth in employment in the economic recovery than are native-born workers. From the fourth quarter of 2009 to the fourth quarter of 2011, the employment of foreign-born workers rose from 21.5 million to 22.6 million, an increase of 5.2%. Also, their employment level at the end of 2011 was back to where it stood before the recession (22.5 million).

For native-born workers, employment increased from 116.5 million in the fourth quarter of 2009 to 118.6 million in the fourth quarter of 2011. This is an increase of 1.8%, well below the rate of growth in employment of foreign-born workers. Also, the employment of native-born workers at the end of 2011 was nearly 5 million less than its level before the recession began (123.4 million).

The difference in the rate of growth in employment between native-born and foreign-born workers is roughly in line with the difference in the growth in their working-age populations during the recovery. From 2009 to 2011, the native-born working-age population increased 1.4% (2.9 million) and the foreign-born population increased 3.8% (1.3 million). Thus, the distribution of new jobs in the recovery across nativity groups—35% foreign born; 65% native born—was in keeping with the changes in the population—32% foreign born; 68% native born.

Because the employment of foreign-born workers is growing only slightly faster than their population, the recovery in their employment rate is far from complete. For immigrants, the employment rate fell from 65.1% in the fourth quarter of 2007 to 60.7% in the fourth quarter of 2009. The rate rose to 61.6% in the fourth quarter of 2011, still 3.6 percentage points less than its pre-recession level.

The trend in the employment rate for native-born workers is similar. It plunged from 62.7% in the fourth quarter of 2007 to 58.1% in the fourth quarter of 2009. During the recovery, the native-born employment rate edged up only slightly, standing at 58.2% in the fourth quarter of 2011. Thus, the current employment rate for native-born workers is 4.4 percentage points less than its level prior to the recession.

Unemployment rates for native-born and foreign-born workers were virtually the same at the start of the recession—4.6% and 4.5%, respectively. By the time the labor market reached its trough in the fourth quarter of 2009, the unemployment rate for immigrants had risen to 10.1% and the rate for the native born had climbed to 9.5%. The unemployment rate for both groups has fallen in the recovery, but the rate for immigrants—8.7%—is still higher than the rate for the native-born—8.3%.