Why Do Black Immigrants Have Lower Incomes than Other Immigrants?

If one examines the Pew Research Center's recent statistical portrait of black immigrants one notices a curious finding. Black immigrants have a median household income of $43,800, but overall immigrants have a median income of $48,000, 9.6 percent higher than for black immigrants. Yet, looking at the statistical profile, one would expect the overall median income to be lower than the median income for black immigrants.

Black immigrants are basically the same as the overall immigrant population in terms of age and the share with a college degree. The median age for black immigrants is 42, and it is 43 for immigrants overall. Twenty-six percent of black immigrants have a college degree, and 28 percent of all immigrants have a college degree. These similarities would lead one to expect that the medians for both groups would be about equal.

However, black immigrants have advantages over the total immigrant population in three areas: legal status, citizenship, and English proficiency. Twenty-six percent of all immigrants are unauthorized, but only 16 percent of black immigrants are. Additionally, a slightly higher share of black immigrants are U.S. citizens (54 percent for black immigrants and 47 percent for all immigrants). Being authorized immigrants and citizens provides immigrants with the opportunity to obtain a higher income than being unauthorized immigrants and non-citizens. For example, researchers have found that unauthorized immigrants suffer from a high rate of employers illegally paying them below the minimum wage [PDF]. Further, "[c]itizen immigrants tend to have similar economic outcomes to native-born Americans, while non-citizen immigrants tend to have much lower incomes," reports the economist Heidi Shierholz [PDF]. Researchers also find that English proficiency contributes to higher earnings [PDF]. Three quarters of black immigrants (74 percent) are proficient in English while only half of immigrants overall are. The fact that more black immigrants are authorized immigrants, citizen immigrants, and proficient in English should lead to black immigrants having higher incomes than average, but instead they have incomes lower than average.

There are some clues as to why black immigrants might have lower incomes in spite of their advantages in a couple of research reports by the Economic Policy Institute. The economist Patrick Mason and I examined whether cultural differences between U.S.-born and foreign-born blacks might have an impact on their wages in "The Low Wages of Black Immigrants." Many people believe that black immigrants possess cultural values that would lead them to greater economic success than U.S.-born blacks. Mason and I did not find evidence to support this view. U.S.-born and foreign-born blacks both had significantly lower wages than U.S.-born whites. In fact, after controlling for worker and labor-market characteristics, some black immigrants were even worse off than U.S.-born blacks. Thus, since both U.S.-born blacks and foreign-born blacks performed poorly in comparison with U.S.-born whites, the real issue may be that there is a penalty for being black in the American labor market.

An additional sign that blackness may be penalized comes from Heidi Shierholz's "The Effects of Citizenship on Family Income and Poverty." In Shierholz's analysis, whites, Hispanics, and Asians all received an income boost from being a citizen when one compares immigrants who are citizens with those who are not. Blacks were the only group for whom citizenship had no positive economic effect. If there is a penalty on blackness, citizenship cannot help black immigrants because citizenship does not change one's race.

Although it appears that black immigrants should have a higher median income than immigrants overall, they have a lower one. The fact that black immigrants do worse even relative to other immigrants, suggests that blackness may be a very powerful disadvantage in the American labor market.