Increased immigration to the United States in the last two decades has heightened interest in the question of the relationship between the labor force and the changing structure of urban economies in the United States.  In the main, immigrants continued to concentrate in a few of the nation’s very large metropolitan areas like Los Angeles and New York. The numbers of arrivals remains high, and questions about how these newcomers fit in economically and culturally, obtaining work and securing shelter endure as some of the most pressing that US society faces.  In New York, we find a city that has undergone profound economic change over the last thirty years.  The native born and newcomers have helped frame these changes and have been shaped by them.

An important element of the story in New York is that mass immigration has occurred despite the city’s anemic employment growth of the last three decades.  So why have immigrants come to New York if opportunities for employment were greater elsewhere?  One of the main explanations is decline in size of the native born white population. In the 1970s, 400,000 native whites left the New York City workforce.  The loss slowed in the 1980s to 100,000 native whites but picked up again in the 1990s.  We estimate that more than more than 250,000 native born whites retired or exited the city’s workforce between 1990 and 1997, even though total employment expanded slightly overall. In the 1970s, this exodus created replacement labor demand in many areas of the economy.  In the 1980s, demographic succession played a reduced role in assigning ethnic groups to jobs in this decade. The absolute and relative decline in the numbers of native born white workers, however, regained the 1970s pace in the 1990s, suggesting that, once again, the exit of native whites is setting is leaving gaps for other groups to fill.
To date, these groups have largely been non-white minorities but the 1990s saw some of these replacement labor needs met for the first time by growth in the foreign-born white population (driven mostly by immigration from the USSR and its successor states).  White immigrants leveraged new and considerable labor market advantage in terms of job creation in much the same way white immigrants from previous decades did and in similar ways to contemporary immigrants from the global South. Almost forty years ago, Glazer and Moynihan (1963) contrasted the labor market behavior of Eastern European Jews and Italians with that of African Americans.  They observed that immigrant whites were more entrepreneurial, which led to employment particularly within their ethnic social field.  The likelihood is that today’s white immigrants will again make use of these advantages to vault past African Americans and other native-born minorities into the ranks of the city’s middle class.
The 1990s also saw a large reversal of fortune of African Americans. In the 1970s and especially in the 1980s, the most potent portion of overall native black job change was the growth effect.  Essentially, when the city grows African Americans get jobs.  Industrial mix has been a relatively unimportant factor.  In the 1990s, these previous patterns were replaced by a massive deterioration in labor market comparative advantage as measured by the group shift effect.  In the aggregate, the African American pattern of employment change began to resemble that of native born whites as immigrant groups replaced them in traditional employment concentrations, such as public services.

 For native Hispanics, the 1970s was a decade in which minor job gain occurred in the aggregate.  The 1980s, however, was a decade of fairly substantial job growth in all sectors except manufacturing, where employment fell by over 36 percent.   Native born Hispanics clearly differ from African Americans in terms of their sectoral employment distribution and emerging patterns of comparative advantage.  Their higher concentration in manufacturing than services produces negative total industrial mix effects in both the 1970s and 1980s.  Thus native Hispanics have had an unfavorable employment distribution in relation to the city’s growth pattern, unlike African Americans.  While gains in services compensated the loss in manufacturing employment, the pattern of service sector comparative advantage distinguishes native Hispanics from African Americans.  As opportunities for native blacks erode in the public sector and expand most clearly in advanced services, labor market comparative advantage for native Hispanics occurs only modestly in advanced services and most notably in the public sector.  These distinct signatures suggest that native-born minority groups fit into New York’s present and likely future division of labor in substantially different ways.  These distinctions are context specific: evidence from Los Angeles suggests that the sectoral employment pattern of native Hispanics in that city is becoming more like that of native blacks (Wright and Ellis 1997).

Although African Americans lost the jobs in the 1990s they gained in the 1980s and total employment for native-born Hispanics grew very modestly in the metropolitan economy, foreign-born black and Hispanic employment grew very rapidly.  Unlike the native groups and foreign-born whites we studied, the performance of the city’s economy in general had little effect on the foreign-born populations investigated here.  Growth effects were relatively minor for blacks, Asians, and Hispanics relative to group shift effects. Overall, these immigrants continued to garner the preponderance of all jobs in the city - most notably in retail trade, but also in professional services and even the public sector.

The sectoral differences among immigrant groups point to an ethnic division of labor among the foreign-born.  Most importantly, some groups are better positioned than others in terms of where they stand in this employment mix: immigrant blacks tend to have jobs in growth sectors whereas immigrant Hispanics do not.  Essentially, immigrant blacks are more likely to work in New York’s expanding service sectors than immigrant Hispanics.  Immigrant blacks enjoyed positive shifts in advanced services and private sector basic services, but their most important emerging sector is public administration.  Conversely, immigrant Hispanics largest shift is into retail trade and personal services and they still retain a disproportionate share of manufacturing’s declining employment base.  Foreign-born Asians are also overly concentrated in manufacturing but have a disproportionately high share of jobs in professional services as well.  As with immigrant Hispanics, foreign-born Asians largest positive shift is into retail trade but, unlike them, they also making significant shifts into advanced services like FIRE.  In short, immigrants are diverse (far more so then we characterize in the chapter on aggregate trends) and fit into New York’s economy in ways that depend on their ethnicity.

That some immigrant groups are better located than others in terms of their concentration in growth sectors portends variability in their future employment fortunes.  Immigrant Hispanics are more likely to suffer the consequences of ongoing job loss in sectors like manufacturing.  In contrast, immigrant blacks, whites, and Asians appear to be less vulnerable to future job loss in traditional industries.  Regardless, the future employment of all immigrant groups will continue to depend on the demography of the native born population. Native born whites, who now make up about one third of the workforce in the city, will probably continue to decline in numbers in the next few years.  This will generate more replacement labor demand, much of it likely to be filled by immigrant groups. The 1990s saw this labor-force exit of native-born workers spread to African Americans and immigrants began filling jobs in their wake.  At some point, however, and that point may have been reached or will be shortly, the loss of native-born workers through retirement and outmigration will slow to the point that replacement labor demand will be insufficient to absorb New York’s new immigrant arrivals.  Unless immigration slows, or New York’s employment grows to absorb these newcomers, other factors, such as worker skills, education, employer preferences, discrimination, racism, union exclusion of minorities, and job networks will become much stronger determinants of ethnic group employment fortunes than they have been to date.  It is hard to sort out the likely winners and losers in this new competition for jobs.  Present trends suggest African Americans and Hispanics, native and foreign-born, will be most likely to lose out if the conditions under which New York absorbs immigrants change as anticipated.