The data from the European Labour Force Survey presented in previous articles (here) suggest that immigrants may have been more exposed than natives to the coronavirus-induced crisis that has unfolded during 2020.
In fact, the data indicate that, among all workers that had a job in the first half of 2019, 95% of natives were still in employment one year later, whereas this share decreases to 91% among immigrants. EU migrants do worse than those from the rest of the world, as they are less likely than those from outside the EU (90.5% vs 91.5%) to be still employed.
Women are more likely than men to have fallen out of employment between the first half of 2019 and the same period in 2020: among natives, the share of men who had a job one year before the crisis, and still have one during the first two quarters of 2020 is 96%, but among women this share falls to 94%. For immigrants, the gender gap is even more pronounced: slightly more than 93% of foreign-born men and 88.6% of foreign-born women who had a job in the first semester of 2019 still have one in the first semester of 2020.
As expected, one key factor affecting the probability job retention between January and June 2020, for those who had one the previous year, is the type of contract. The employment probability in the midst of the coronavirus crisis is a striking 21 percentage points lower for workers who had a temporary contract one year earlier, relative to those who had a permanent position. Interestingly, the effect of temporary contracts is the same for both natives and immigrants – although the latter are significantly more likely than natives to have a short-term job. Likewise, workers that in 2019 were employed in sectors not directly affected by the lockdown of Spring 2020 have a 2.4 percentage points higher probability of being in employment one year later: the effect is the same for both immigrants and natives; however, natives are more likely to be employed in one such sector.
Obviously, these data provide only a partial picture of the heterogeneous consequences of the COVID-19 shock on the labour market outcomes for immigrants and natives. The picture is partial for at least two reasons. First, the employment probability of a population at any given point in time depends not only on how many workers manage to keep the job they already have, but also on how many unemployed workers find a new job – and the data presented above omit this second channel which may be relevant. Additionally, it could be the case that the share of immigrants that manage to retain their job over a period of one year is in general lower than among natives, and that the differential we observe between immigrants and natives in the probability of being still in employment between the first half of 2019 and the same period of 2020 has nothing to do with the COVID-19 shock, but is instead driven by other factors that appear every year.
To address both type of concerns, we compare the immigrant-native differential in employment probability in the first two quarters of 2019 with the differential in the same two quarters of 2020, in what is called a “difference-in differences” setting.
Figure 1: Immigrant employment gap increased during the pandemic
Quarterly immigrant-native differences in employment probability, Q1 2018 – Q2 2020
The employment probability of natives was 66.2% in the first two quarters of 2019, and did not significantly change in the same period of 2020. However, while in the first half of 2019 immigrants’ employment probability was 1.5 percentage points lower than natives’ (64.7%), this differential increased by 2.5 percentage points (62.2%) during the first six months of 2020: this suggests that the coronavirus exerted a stronger toll on immigrants’ employment than on natives’, at least initially. This pattern is evident in Figure 26, which reports the quarterly evolution of the immigrant-native gap in employment probability between the first quarter 2018 and the second quarter 2020. The graph clearly shows the seasonality of employment gaps, that are smaller in the central quarters of the years, and become larger in the first and last quarter; it also displays, with the same clarity, the “anomalous” behaviour of the gaps in 2020. The employment probability differential in the first quarter of 2020 was already larger than in the two previous years, even though only March was completely affected by the Italian lockdown measures. The gap increases further during the second quarter, which was fully affected by the coronavirus shock.
Interestingly, the shock did not affect immigrant native differentials in other labour market outcomes such as occupational quality, average wages, or probability of working in a low- skilled occupation. However, immigrants increased their probability of being at the bottom of the national income distribution as a consequence of the crisis: the differential probability of being in the first income decile between immigrants and natives increased from 8.3 percentage points in the first two quarters of 2019 to 9.5 in the same period 2020.
Figure 2: Immigrant women were more affected than men by the coronavirus crisis
Quarterly immigrant-native differences in employment probability, Q1 2018 – Q2 2020
Immigrant women have had lower employment rates than native women since before the coronavirus outbreak: in the first semester of 2019 their employment probability was 8 percentage points lower than Italian women (48.5% vs. 56.7%). However, during the first semester of 2020 that differential increased by 3.3 additional percentage points, a 40% growth. Conversely, immigrant men’s employment probability has been steadily higher than for Italian men, by 4 percentage points during the first two quarters 2019 (80% vs 76%), and the gap did not significantly change during the first semester 2020. Much of the differential effect of the crisis between immigrant men and women can be presumably traced down to their different distribution in terms of both sectors and occupations: most notably, the higher concentration of women relative to men in the service sector and in service and elementary occupations. The pandemic has also widened the pre-existing gap in occupational quality between immigrant and native women, particularly by increasing the probability of immigrant women of working in an elementary occupation by 2.5 percentage points.
Immigrants with different educational qualifications have been heterogeneously affected by the COVID-19 shock. While low-educated immigrants’ employment probability in the first semester 2019 was 12 percentage points higher than the employment probability of low- educated natives (62% vs 50%), this differential shrank by 2 percentage points during the same period of 2020. Conversely, the immigrant-native gap in employment probability for workers with intermediate and high levels of education was essentially unaffected over the same period (Figure 3).
Figure 3: Low-educated immigrants have been more affected by the crisis
Quarterly immigrant-native differences in employment probability by education, Q12018 – Q2020
Regional heterogeneity of the COVID-19 effects
The geographic distribution of immigrants is different from natives, as immigrants are especially concentrated in Northern regions, which have been more severely affected by the first wave of COVID-19. Therefore, it may be interesting to explore whether the effects of the coronavirus shock have been heterogeneous across regions, and how. This analysis is necessarily tentative, since the sample size at the regional level is quite small, and estimates tend to be imprecise; hence, all results have to be interpreted with some caution.
The effect of the pandemic on the regional differential in employment is indeed different across regions (Figure 4).
Figure 4: Immigrants’ employment was most affected in Southern regions
Pandemic-Induced Differential in Employment Probability by region, Q1& Q2 2019 –2020
However, the regions where immigrants’ employment probability has decreased the most relative to natives (and in absolute terms) are those in the South, especially Sardinia, Calabria, Sicily and Campania. This is slightly surprising: in fact, these regions only host a relatively small number of immigrants, and they also were only marginally affected by the first coronavirus wave. Lombardy is the Northern region where immigrants’ employment probability suffered the most because of the virus, although Trentino and Friuli were very close. Surprisingly, immigrants in Emilia Romagna, the region with the second highest share of foreign-born residents after Friuli, and one of the most affected by COVID-19, have not been affected by the crisis significantly more than natives.
Figure 5: Immigrants’ employment loss is larger in regions where they perform more elementary occupations
Pandemic-induced differential in employment probability vs, share of immigrants employed in elementary occupations by region, Q1 and Q2 2019 – Q1 and Q2 2020
