Immigration, household production, and native women’s labor market outcomes: A survey of a global phenomenon

Abstract

Most of the literature on how immigration affects the labor market focuses on the outcomes of natives in direct competition with immigrants. This paper reviews a growing literature on an alternative channel. Immigrants, particularly low-skilled women, are disproportionately represented in the household services sector, a global phenomenon that is seen to some extent in most regions. A simple time-use model suggests that by lowering the price of market-provided household services, immigrant workers allow high-skilled native women to reduce their unpaid household production and increase their participation in the labor market. I review existing evidence that the presence of foreign domestic workers has increased the labor supply of high-skilled native women, has helped narrow the gender earnings gap in high-paying powered occupations, and that these advances have not come at the cost of native women investing less time in their children or having lower birth rates. I discuss the policy implications of these results, as well as some ethical considerations.