Do Skilled Migrants Compete with Native Workers?

Abstract

Skilled migration is seen as a solution against skill shortages, but its impact on native workers facing increased competition remains debated. To investigate the longer-term potential for displacement, this paper exploits a 2008 reform in France facilitating the hiring of foreign workers within a list of tight occupations. The analysis relies on administrative data and applies a difference-in-differences approach. Results show that the reform successfully boosted migrant hires without affecting native employment. In addition, the negative pressure on occupational wages is much larger among migrants than natives, suggesting that such policies can be a viable solution in the long run.