Ethnic Minority Immigrants and Their Children in Britain

This paper investigates educational attainment and economic performance of ethnic minority immigrants and their children in Britain. Based on the British LFS, we construct two samples: ethnic minority immigrants who are born between 1933 and 1954, and whom we observe between 1978 and 1984; and ethnic minorities born in Britain between 1963 and 1975, and whom we observe between 1998 and 2005. We compare them to corresponding cohorts of white British born. We find that ethnic minority immigrants and their British born descendents are on average better educated in comparison to their British born white peers. Further, educational attainment of British born minorities is far higher than that of their parent generation, and supersedes for all minority groups that of their white native born peers. Despite this, British born ethnic minorities exhibit on average lower employment probabilities than their white native born peers, although there is large variation across the different groups. Further, although their mean wages appear to be slightly higher than those of their white native born peers, this is due to their higher educational attainment and their concentration in Greater London. If British born ethnic minorities had the same characteristics and regional allocation than their white British born peers, their wages would be considerably lower. We show that differences in wage offer distributions hardly account for the employment differences of British born ethnic minorities. As possible explanations, we examine, among others, heterogeneity in educational degrees between the two groups and preferences for work.