In 2021, more than 11% of European residents were born outside their current country of residence, i.e., they were first-generation immigrants. An additional 3.5 percent were instead native-born but from both foreign-born parents, i.e., they were so-called “second-generation immigrants”. These shares increase to almost 14% and 4%, respectively, in EU14 countries, which are, however, characterised by significant heterogeneity. Among EU14 countries, Luxembourg has both the highest share of first- and second-generation immigrants (54% and more than 8% of the total population), and countries like Austria (20% first and 7% second generations), Belgium and Germany (17% and 7%) also have among the highest shares of both. However, countries like Sweden and Ireland are characterised by a higher-than-average share of first-generation immigrants (21% and 19%, respectively) but host a proportionately smaller population of second generations (respectively 3% and 4%). Finally, some Southern European countries are characterised by low shares of first and second-generation immigrants. This is the case for Greece (6% and 2%), Italy (10% and 2%), and Portugal (6% and 1%).
Figure 1: Share of first-generation and second-generation immigrants
Share of first- and second-generation immigrants in the total population (2021)
First-generation immigrants in Europe tend to be slightly less educated on average than natives. This happens mainly because a higher share of migrants than natives (33% vs 18% in Europe, or 34% vs 21% in EU14 countries) has at most completed lower secondary education, but also because of a slightly higher share of tertiary educated natives (34%, which increases to 36% in the EU14) than of tertiary educated migrants (32%, 31% in the EU14). In contrast, the educational levels of second-generation immigrants are remarkably similar to those of natives. The share of second generations with, at most, lower secondary education (17%) is lower than among natives (18%), and the differential is more significant in the EU14 (18% vs 21%). Conversely, across Europe, the share of tertiary educated natives and second-generation immigrants is very close (around 34%, see Figure 2), and even in the EU14, the gap is only modest (36% and 34% for natives and second generations, respectively).
Remarkably, even though first-generation EU immigrants are generally more highly educated than non-EU immigrants (respectively 36% and 30% in each group have tertiary education), the share of tertiary educated individuals among the second generations is similar for both groups, around 34%.
Figure 2: Natives and first- and second-generation immigrants have similar tertiary education rates
Share of tertiary educated natives, first- and second-generation immigrants (2021)
First generations are characterised by lower occupational quality than similarly educated natives. These labour market gaps can be explained by different factors: lack of some dimensions of country-specific human capital (e.g., a lower fluency in the host country’s language), limited access to professional networks, imperfect recognition of foreign qualifications, lower quality of the home-country educational qualifications, but employers’ discrimination might also drive them.
However, a significant fraction of immigrants have acquired their highest level of education in the host country, about 30% across Europe. This share is similar among EU and non-EU migrants (29.1% and 30.4%, respectively). The fraction of domestically-educated immigrants is even higher (38%) among those with tertiary education. For this group of immigrants, all of the factors related to human capital transferability that hold back integration should be significantly attenuated or even disappear altogether. This should be even more true for second generations who were born, raised and educated in their current country of residence.
Immigrants with a foreign education have the most significant employment probability gap (13 p.p.) relative to natives (Figure 3). Such a gap cannot be explained by differences in the age, gender and educational composition of the two populations: when compared to natives with the same demographic profile, the employment probability gap of foreign-educated immigrants is still ten percentage points. Conversely, first-generation immigrants who have received their highest educational qualification in the host country and second-generation immigrants display more modest employment probability gaps relative to natives, about five p.p. if compared to natives with similar demographics. Therefore, comparing the employment probability gap experienced by immigrants who were educated abroad and those who were educated domestically suggests that about half of their disadvantage can be attributed to imperfect human capital transferability. In contrast, the remaining half is likely driven by other factors such as smaller or less valuable networks or discrimination.
Interestingly, the employment probability gaps among immigrant men are similar regardless of where they were educated. This suggests imperfect human capital transferability is not the main reason for their employment disadvantage. In contrast, immigrant women with a foreign education experience an employment disadvantage that is three times as high as their male counterparts, whereas, among those who received their education in the host country, the employment probability gaps align with those of men. Likewise, differences in employment probability disadvantage between EU and non-EU migrants follow a similar pattern. Among EU migrants, differences are relatively small and not too dissimilar between those with a foreign or a domestic education (3 and 2 percentage points, respectively). However, among non-EU migrants, not only are employment gaps larger in general, but having a domestic education halves the gap (from 13 to 7 p.p.)
Figure 3: Immigrants with foreign education are the least likely to have a job
Immigrant-native differences in employment, by country of education (2021)
The differences between foreign-and domestically-educated immigrants become even more pronounced regarding occupational status.
On average, across Europe, employed first-generation immigrants are 17 p.p. more likely than natives to work in a low-skill and low-pay occupation (Figure 4). Since about 8% of European natives work in this type of occupation, immigrants with a foreign education are three times more likely than natives to have a low-paying job. Part of this gap can be traced back to differences in age, gender and education composition between the two groups. Yet, accounting for such differences in individual characteristics reduces the differential by only about one-fifth.
However, among immigrants who received their education in the host country, the probability of working in a low-pay occupation is only two p.p. higher than among natives with similar characteristics. This differential goes to zero among the native-born children of immigrants.
Figure 4: Immigrants with foreign education are more likely to work in low-pay occupations
Immigrant-native differences in probability of working in elementary occupations, by country of education (2021)
A similar pattern is evident when we consider instead the probability of working in high-skill (and high-pay) occupations (Figure 5). While foreign-educated immigrants are 22.5 p.p. less likely than natives to be employed in this type of jobs (about 14 p.p. when compared to natives with similar characteristics), the gaps are close to zero for domestically-educated first generations and for the second generations.
Thus, having a domestic education is not enough to eliminate the gap in employment probability. However, for immigrants who have a job, it reduces considerably (and eliminates for the second generations) the occupational clustering in low-pay occupations and outside high-pay jobs.
Figure 5: Immigrants with foreign education are less likely to work in high-pay occupations
Immigrant-native differences in probability of working in high-pay occupations, by country of education (2021)
If the labour market disadvantage of immigrants with foreign qualifications is driven by their lack of host-country-specific skills, then such a gap may close over time, as they acquire such skills with time spent in the host country. In fact, as Figure 6 shows, the gap in employment probability relative to natives with similar age, gender and education profiles is substantially higher for foreign-educated immigrants than those who have completed their education in the host country during the first years after arrival. For both immigrant groups, the employment disadvantage vis-à-vis natives tends to shrink among those who have been in the country longer. However, the pace of the reduction is much higher for the foreign-educated group. Among immigrants who have been in the host country for at least ten years, the employment probability gap with respect to natives is the same for those who studied abroad and those
who obtained their education in the host country. Importantly, neither group of immigrants completely catches up with the natives, even after many years since migration.
Unlike for employment, foreign-educated immigrants do not catch up with those educated in their country of residence regarding the probability of working in a low-skill and low-pay occupation (Figure 7). Even among immigrants who have been in the country for as long as thirty years and who share similar age-gender-education profiles, the probability of working in a low-skill job is about six percentage points higher for those who have studied abroad than for natives, regardless of the number of years since migration.
Thus, there is something about foreign education that persists over time and does not allow full convergence of immigrants’ outcomes not only to those of natives but not even to those of domestically-educated immigrants.
Figure 6: After ten years since migration, the employment gaps of foreign- and domestically-educated immigrants are the same
Evolution of immigrant-native differences in employment over years since migration, by country of education (2021)
Figure 7: Foreign-educated immigrants are more likely to work in low-pay occupations regardless of time spent in the host country
Evolution of immigrant-native differences in probability of working in elementary occupations over years since migration, by country of education (2021)
