This paper examines income and employment outcomes for immigrants in Sweden’s most immigrant-dense neighbourhoods between 1998 and 2022. While relative employment among immigrants has improved, relative incomes in these neighbourhoods have stagnated or declined.
The most plausible explanation for the persisting income gap and the shrinking employment gap between immigrant-dense and other neighbourhoods is that immigrants in immigrant-dense neighbourhoods are increasingly channelled into non-standard employment. If we look at all immigrants, regardless of where they live, gaps between immigrants and natives are shrinking, both in terms of income and employment. Reconciling these patterns, we show that individuals in immigrant-dense neighbourhoods who enter employment are more likely to relocate to other areas.
