Occupational Changes, Investments, and Ethnicity Among Legal U.S. Immigrants

Background and Purpose: Most immigrants experience a loss of occupational status upon arriving in the U.S. This status downgrade affects their income and ability to make investments. Understanding the link between immigrants' occupational trajectories and investment is critical for predicting their long-term economic success. The primary objective of this study is to investigate the relationship between U.S. immigrants' occupational changes and their accumulation of assets. This research makes a valuable contribution to the literature because there are no known studies that examine this relationship. Our secondary research question is to examine ethnic differences in this relationship.

Methods: The cross-sectional data used in this study come from the National Immigrant Survey 2003 cohort. The sample consisted of 3,746 legal adult immigrants. The dependent variable was measured as a categorical variable with four arms: (0) no assets, (1) financial assets, (2) real assets, and (3) both types of assets. To measure the independent variable, occupational change, we used two occupation variables before and after immigration and generated an occupational change variable that included three arms: (1) downward change = job_time1 > job_time2, (2) no change = job_time1 = job_time2, and (3) upward change = job_time1 < job_time2. Data analyses included descriptive statistics; bivariate analyses to compare the relationship between occupational change, ethnicity, and asset holding; and multivariate analysis to examine the association of immigrants' occupational changes with their asset holdings. We used multiple imputation to address missing values in the income variable. Because the dependent variable has four categories, we used multi-nominal logistic regression, selecting ‘no assets' as a base category and controlling for demographic and immigration characteristics. In addition, we conducted five sub-ethnic regression models.

Results: The basic model showed that compared to those who experienced no change in occupation status: (1) those who experienced an occupational downgrade were less likely to hold financial assets; (2) those in the upwardly mobile category were more likely to have both types of assets while downwardly mobile people were less likely to own both assets; and (3) there was no significant association between occupational change and real asset holdings. These results suggest that respondents tended to decrease their financial assets to buffer the downgrading shock. When respondents already hold real assets and experience an occupational upgrade, they tended to increase their financial assets. Furthermore, the sub-ethnic analyses reported that compared to those whose occupational status remained the same: (1) For Asians, Middle Easterners, and Africans, occupational downgrading was associated with a lower probability of owning financial assets; (2) For Europeans, Australians, and Canadians, those in the upwardly mobile category were more likely to hold both types of assets; and (3) For Latin Americans, there was no association between occupational change and asset holdings.

Conclusions and Implications: The results demonstrate a link between occupational mobility and immigrants' investments, revealing the ethnic differences in the association. We suggest policies or programs that would allow immigrants with degrees from universities abroad to validate their credentials to have equal value in the United States. We also discuss the necessity of economic empowerment interventions.