Immigrant wages are lower in immigrant-dense areas, and the limited-English differential is mostly occupational: metropolitan Philadelphia, 2012–2024

Abstract

Immigrants who speak limited English earn less than those who speak it well. On the protective view of residential concentration, that differential should be smaller where immigrants are concentrated, because concentration supplies employers and customers who do not require English. On the isolation view it should be larger. This study tests both views in metropolitan Philadelphia, a former gateway whose immigrant population has grown again, with American Community Survey microdata for 2012 to 2024 and a two-level model of 7,355 foreign-born workers in 48 Public Use Microdata Areas. Hourly wages are about 8 percent lower per standard deviation of area immigrant density for foreign-born workers who speak English well and about 3 percent lower, an estimate not distinguishable from zero, for those who speak it poorly. Native-born workers in the same areas show a gradient of 2 percent, so most of the difference is specific to immigrants. The interaction between density and limited English is 0.049 (standard error 0.029) and disappears once occupation is held constant. The limited-English differential is 21 percent overall and 9 percent within an occupation, so most of it is associated with the occupations limited-English workers hold. An exploratory measure of the density of the worker’s own home language gives a positive interaction of 0.046 (0.022), driven by lower wages for proficient workers rather than higher wages for limited-English workers, and the same specification in the New York metropolitan area gives 0.045 (0.009). Higher earners move from the city to the suburbs.