Does an increase in the number of immigrant workers reduce unemployment rates? An industry sector unit level analysis in Japan

Abstract

This study examines the effect of immigration on sector unemployment rates in Japan from 2009 to 2018. While previous studies have explored the effects of immigration using either nationwide or regional unemployment rates, analysis by industry units has been rarely conducted. The results of the analysis reveal that unemployment rates decrease with an increase in the number of immigrant workers in industry sectors with labor shortages; otherwise, they are neutral to the labor market. Since the analysis using industry sector units provides different implications from that using geographic units, it underscores industry-specific immigration effects in the study of unemployment rates.