RT Journal Article
SR Electronic
T1 Labor Market Effects of Open Borders: Evidence from the Finnish Construction Sector after EU Enlargement
JF Journal of Human Resources
JO J Hum Resour
FD University of Wisconsin Press
SP 0321-11546R2
DO 10.3368/jhr.0321-11546R2
A1 Kuosmanen, Isa
A1 Meriläinen, Jaakko
YR 2022
UL http://jhr.uwpress.org/content/early/2022/07/06/jhr.0321-11546R2.abstract
AB The eastern enlargement of the EU differentially exposed workers in different regions and occupations in Finland to foreign workforce, in particular to posted workers. Using a triple-differences strategy and detailed individual-level administrative data, we document robust evidence that the entry of new EU countries decreased the annual earnings of vulnerable workers relative to less vulnerable workers in the construction sector. This decrease was persistent even ten years after the enlargement and economically meaningful, about 9 percent (roughly a month’s salary per year), on average. We also show a small increase in unemployment and provide evidence on different adjustment mechanisms.