Where Do Immigrants Fare Worse? Modeling Workplace Wage Gap Variation with Longitudinal Employer-Employee Data

Abstract

The authors propose a strategy for observing and explaining workplace variance in categorically linked inequalities. Using Swedish economy-wide linked employer-employee panel data, the authors examine variation in workplace wage inequalities between native Swedes and non-Western immigrants. Consistent with relational inequality theory, the authors' findings are that immigrant-native wage gaps vary dramatically across workplaces, even net of strong human capital controls. The authors also find that, net of observed and fixed-effect controls for individual traits, workplace immigrant-native wage gaps decline with increased workplace immigrant employment and managerial representation and increase when job segregation rises. These results are stronger in high-inequality workplaces and for white-collar employees: contexts in which one expects status-based claims on organizational resources, the central causal mechanism identified by relational inequality theory, to be stronger. The authors conclude that workplace variation in the non-Western immigrant-native wage gaps is contingent on organizational variationin the relative power of groups and the institutional context in which that power is exercised.