New research finds a significant ‘migrant wage gap’ compared to their Irish counterparts

wallet open with coins inside

by HRHQ Editorial Team

New ESRI research funded by the Department of Children, Equality, Disability, Integration and Youth finds that while non-Irish nationals as a whole earned 22 per cent less per hour than Irish nationals, East European workers earned, on average, 40 per cent less than Irish workers in the period 2011-2018. However, for non-Irish workers overall, this wage gap shrunk over time: from 25.5 per cent in 2011–2013, just after the Great Recession, to 18.7 per cent in 2016–2018. The study also finds migrant women face a double wage penalty. The report draws on high-quality Revenue data on wages matched to Labour Force Survey (LFS) data on jobs and workers to investigate the wage gap.

Advertisement

Key Findings

  • Non-Irish nationals are generally more likely to be found in lower quality jobs. For example, they are less likely to work in professional/managerial occupations (33 per cent compared to 44 per cent of Irish nationals). Non-Irish nationals are much less likely to be members of trade unions or staff associations (13 per cent compared to 34 per cent for Irish nationals).
  • A ‘migrant wage gap’ exists in Ireland. In the period 2011–2018, non-Irish nationals earned, on average, 22 per cent less per hour than Irish nationals – for every €1 an Irish worker earned, a non-Irish worker earned 78 cents.
  • Yet earnings differ considerably depending on origin country. East Europeans earn 40 per cent less per hour than their Irish counterparts. Part of their wage gap can be explained by differences in their social and demographic characteristics (e.g., education level), the kinds of jobs that they do, and firms for which they work. However, even after we account for these differences in characteristics, East Europeans still earn 20.5 per cent less than Irish nationals.
  • For other non-Irish groups, the gap is much smaller – especially those from West Europe, North America, Australia and Oceania. This is partly because they have higher educational qualifications, but they still get lower rewards for education than Irish workers.
  • For African nationals their employment rates are very low, and when in work, they earn on average 14 per cent less than Irish nationals, after accounting for background and job characteristics.
  • Non-Irish women experience a double earnings penalty: for being female and for being a migrant. Non-Irish women earn 11 per cent less than non-Irish men, who in turn earn 18 per cent less than Irish men. This means non-Irish women earn 30 per cent less than Irish men.
  • The migrant wage gap narrowed over time, from 25.5 per cent in 2011–2013, to 18.7 per cent in 2016–2018, in part because the skill level of the non-Irish workers increased and because they are working in higher quality jobs. However, a significant 2.5 percentage point reduction in the wage gap over time remains even after we account for these changes in Irish and non-Irish characteristics.

Policy Implications 

Several possible changes could help reduce the migrant wage gap. The wage premium found among members of trade unions alongside the very low level of membership of such bodies among non-Irish nationals suggests that greater trade union membership would benefit migrant wages. Previous research has also shown that English language skills are clearly related to job quality, so effective English language training for those who need it is also likely to reduce the wage gap.

While Ireland has robust anti-discrimination legislation, specific measures to combat labour market discrimination may be required. In this respect, the current development of an anti-racism strategy in Ireland is very important (Anti-Racism Committee, 2021). Job quality, including wages, should be a priority for migrant integration policy and should be incorporated into the successor to the Migrant Integration Strategy 2017-2021.

See the full report here