Assessing job quality in the French labour market: decompositions of the native/migrant wage gap

Having a job, and particularly having a job of good quality, is an important determinant of people’s well-being. In many countries, inequality starts in the labour market. Indeed, changes in the distribution of wages are found to be the key factors behind recent inequality trends (ILO 2015). A high level of inequality can create divisions within society, reduce opportunity and social mobility: it could weaken the social cohesion and reduce household consumptions with low rates of economic growth. All these issues can threaten the political stability. In this study, we contribute to the literature on immigrants in the French labour market by analysing the earnings differentials between workers born in France and workers born abroad. We used the wage indicator of job quality by using the 2013 French Working condition survey carried out by DARES (Directorate for Research, Studies and Statistics). Given the importance of the immigration phenomenon in the EU countries and in particular in the French labour market context, the aim of the paper is to explain the differences between immigrant and native workers in terms of wage by using decomposition techniques, controlling for a large set of covariates. The decomposition methods allow us to decompose mean differences in two components: the “explained” and the “unexplained” part (the second one is often used as a measure for discrimination). In particular, as an extension to the classical decomposition method, proposed by Oaxaca (1973) and Blinder (1973), we applied the decomposition method proposed by Firpo et al. (2007, 2009) to consider the ways in which various characteristics of immigrants and natives affect the wage gap along the whole distribution of wages, at points other than the mean.