How do low-education immigrants adjust to Chinese import shocks? Evidence using English language proficiency

Abstract

This paper examines the link between trade-induced changes in local labor market opportunities and English language fluency rates among low-education immigrants in the United States. The production-based manufacturing jobs lost due to Chinese import competition around the turn of the century did not require strong English-speaking skills while many of the jobs in expanding industries, mostly in the service sector, did. Consistent with responses to these changing labor market opportunities, we find that a $1,000 increase in import exposure per worker in a local area led to an increase in the share of low-education immigrants speaking English very well in that area by about half a percentage point. As evidence that at least part of this is a result of actual improvements in English language speaking abilities, we show that low-education immigrants in trade-impacted areas became especially likely to be enrolled in school compared to similarly low-education natives. While we find some evidence for domestic migration in response to trade shocks, we also show that our results are not likely to be driven by language-selective internal migration or initial settlement decisions.