Unemployment Gap between Long-term Immigrants and Natives in Japan: Considering heterogeneity among immigrants from Asia, the US and UK, and South America

Author Name LIU Yang (Fellow, RIETI)
Creation Date/NO. March 2022 22-E-024
Research Project Empirical studies on issues of foreign employment and technology progress in a society with a persistent labor shortage
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First draft: March 2022
Revised: May 2022
Revised: November 2023


This study provides some of the first evidence for unemployment of long-term immigrants in Japan, considering heterogeneity among three immigrant groups from Asia, US and UK, and South America. This study uses large-scale population census data from Japan, conducted in 2010, which is the most updated census data including education and other detailed individual information in the country. First, compared to the natives, the unemployment rate is generally lower for US and UK immigrants, while it is higher for immigrants from Asian and South American countries. However, controlling for human capital, individual and household characteristics, and residential regions, the study finds that immigrants from all the sample countries have higher unemployment probabilities compared to natives. Further, the gaps of permanent employment still exist after controlling for observed factors including industries and occupations, except for women from the US and UK. Moreover, the non-liner decomposition analysis result indicates the different contributions of observed factors among immigrant groups. The results suggest that immigration policies that consider the differences among immigration groups may achieve better outcomes, and that ethnic penalties should be tackled for both high-performing and low-performing immigrant groups.