Skills mismatch and informal sector participation among educated immigrants: Evidence from South Africa

Using South African census data, we show that immigrants with tertiary education from different origin country groups differ in their likelihood of obtaining a skilled job. Immigrants from advanced country groups outperform native internal migrants, while those from many African country groups underperform them. Immigrants with advanced degrees from certain country groups are also more likely to be employed in unskilled, informal sector jobs. Variation in outcomes across origin country groups is smaller at higher levels of education. We further explore characteristics of origin country groups correlated with immigrant outcomes. Our results suggest under-utilization of immigrant skills, which has particular implications for emerging economies grappling with skills shortages.JEL Classification: F22; H52; J24; O2