September 2015

IZA DP No. 9352: Occupational Attainment and Earnings among Immigrant Groups: Evidence from New Zealand

Sholeh A. Maani, Mengyu Dai, Kerr Inkson

published in: Australian Journal of Labour Economics, 2015, 18 (1), 95-112

This paper concerns the prediction of career success among migrants. We focus specifically on the role of occupation as a mediating variable between the predictor variables education and time since migration, and the dependent variable career success as denoted by occupational status, linked to earnings. This is the first application of this analysis to New Zealand data. New Zealand provides an interesting case, as a country where migrants from diverse ethnic groups comprise a significant part of the population. Following a review of the literature specifically focused on occupation, we apply Ordered Probit analysis to a sample of over 37,900 employed males. We focus on the occupational attainment of immigrants and the native-born populations and provide evidence on the mediating effect of occupational attainment on earnings. Our analyses show the interplay of factors leading to occupational attainment: for example, education level is of greatest importance, and much of its effect on earnings is through occupational attainment; different immigrant groups have differentiable outcomes, and years of experience in the host country enable gradual occupational advancement. Our results highlight the significant mediating role of occupational attainment in explaining earnings across immigrant and native-born groups.