IZA DP No. 7378: Intra-Firm Upward Mobility and Immigration
We examine how immigrants in Canada fare in terms of promotions relative to their native peers. Using linked employer-employee data and firm effects, we identify the extent to which differences in promotion outcomes result from immigrants sorting into firms offering "dead-end" jobs versus facing intra-firm barriers to advancement. We find that while white immigrants experience broadly similar promotion outcomes relative to their white native peers, visible minority immigrants – particularly those in their first five years in Canada – are substantially less likely to have been promoted and have been promoted fewer times with their employers than their white native peers. Newly arrived female visible minority immigrants sort into firms offering "dead end" jobs, but most of the differences in promotion outcomes between immigrants and their native peers result from intra-firm differences in promotion outcomes. The findings imply that policies that do not tackle barriers to advancement within firms may be insufficient to address the difficulties faced by immigrants in the labor force.