Skills Gap Grows, Even as Immigrants Are More Educated

By Steven A. Camarota and Steven A. Camarota on June 9, 2011

A new Brookings Institution study entitled "The Geography of Immigrant Skills: Educational Profiles of Metropolitan Areas" examines the education level of immigrants at the national and local levels. The education level of immigrants is a very important topic because there is no better single predictor of how an immigrant will do in the United States than his or her educational attainment.

The Brookings report is certainly interesting and worth reading. Moreover, the large share of immigrants who have a college degree, which is the focus of the report, is certainly good news and a reminder that while many immigrants are unskilled many others are highly educated. Putting aside non-economic issues, highly educated immigrants tend to earn good wages and, on average, will pay more in taxes than they use in services.

Nevertheless, there is nothing really new in the report (though this didn't stop the Washington Post from featuring it on today's front page.) It has been known for some time that the share of immigrants who have at least a college degree is similar to the share who have not completed high school. Back in 2001, CIS published a report showing that 32 percent of recent immigrants (age 25 to 64) had not completed high school compared to 28 percent who had a college degree. And it has also been known that immigrant education levels differ significantly by metropolitan area.

The real concern has been and remains the very large share of immigrants that have relatively little education compared to natives. Immigrants are still three and a half times more likely than natives to lack a high school diploma. The relative skills gap between recent immigrants and natives at the bottom of the education distribution – a gap that grew dramatically after 1970 – remains. In 1970, 48 percent of recent immigrants (ages 25 to 64) compared to 42 percent of natives had not completed high school – a six percentage-point gap. In 2010 the figure for recent immigrants (ages 25 to 64) was 30 percent, compared to 7 percent for natives – a 23 percentage-point gap. Thus both immigrants and native became more skilled; but the improvement for natives was much faster, so the gap between them widened. Interestingly, at the top end of the education distribution recent immigrants in 1970 were nearly 50 percent more likely than natives to have at least a college degree. In 2010, the share of recent immigrants and natives with a college degree is about the same – around 32 percent**. Thus the advantage immigrants enjoyed at the top end disappeared while a huge gap persists at the bottom end. It's this comparison with the native born that is most relevant to policy making.

The other big issue to consider is that the employment picture for natives with a college degree looks very bad during this recession. Those with a bachelor's degree are generally much more insulated from recessions than other workers, and to some extent this is still true. But for young college graduates (21 to 29) the broader measure of unemployment (referred to as the U-6 rate) was 12.2 percent in the first quarter of 2011. The U-6 measure includes those who want to work but have not looked recently because they are discouraged, and those forced to work part-time. Moreover, nearly one in five young college graduates was not working in the first quarter, a dramatic increase from before the recession.*** Thus the large number of more-skilled immigrants being allowed into the country maybe adding to the significant problems this group already faces in the current economic downturn. Many of these students have incurred large debts to complete their degree and now face diminished employment opportunities. When celebrating the impact of skilled immigrants, we ought not lose sight of what has been happening in the labor market.

** All figures are from public use file of the March 2010 Current Population Survey, including the Annual Social and Economic Supplement. Figures for immigrants include those in the country legally and illegally. Recent immigrants in 1970 and 2010 are defined as having arrived in the 10 years prior to the survey.

*** All figures are from the public use files of the January, February and March 2011 Current Population Survey.