Measuring integration in the labor market - which to use, the demographic or the ethnic concept?

Abstract

In most countries, the data and the underlying theoretical approaches tend to emphasize the greater success of the natives or the ethnic majority in the labor market. When measuring integration and success in the labor market, different approaches can be used, for example, the demographic or ethnic concept. The ethnic concept refers to ethnicity, regardless of having an immigrant background or not. The demographic concept instead uses the native/immigrant dimension, usually considering first- and second-generation immigrants. Researchers' use of these concepts varies by country but rarely do they discuss which concept would be more relevant to measure labor market differences and inequalities. Relevance is defined by how labor market differences and inequalities can be identified most clearly. In recent literature, it is suggested that in Baltic countries statistical categories of "international migrant/foreign-born" (demographic concept) are not relevant to use because migration took place inside the borders. In the current article, the focus is on the Estonian context and the research question, therefore, asks which concept is suitable for the Estonian context when taking the Russian speaking population into consideration in labor market analysis. Results lead to the conclusion that using the demographic concept without making an ethnic distinction could lead to a distorted interpretation of the Russian-speaking population’s labor market integration in the Estonian context. This result also supports the recommendations from previous literature to use an ethnic concept. The study used the Labor Force Survey (LFS) 2013-2014 for the empirical analysis.