Cheap Nannies and High-Skilled Mommies

by Phil Rockrohr
Published: June 7, 2008

Cheap Nannies, High Skilled Mommies

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Despite popular notions to the contrary, one study shows low-skilled immigrants are aiding at least one segment of the American labor market—high-skilled women who previously spent more time at home, according to research by Patricia Cortes.

 

Recent conventional wisdom suggests both that the influx of low-skilled immigrants in the 1990s negatively affects the job market opportunities for U.S. citizens and that high-skilled American women are opting out of the labor market to raise children. Patricia Cortes, assistant professor of economics and Richard N. Rosett Faculty Fellow, has conducted recent research that disputes both popular theories.

In “Cheap Maids and Nannies: How Low-Skilled Immigration Is Changing the Time Use of High-Skilled Women,” Cortes and coauthor Jose Tessada of Massachusetts Institute of Technology find that the flow of low-skilled immigrants in the 1990s led to another 20 to 30 minutes at work each week for women with a professional degree, an MBA, or a PhD. At the same time, such women decreased the time they spent on household work and reported increased spending on such services.

“Why high-skilled women? Because it is most costly for them to devote time to do the household work themselves,” Cortes said. “If they are working at home, they’re not working in the market, and they’re giving up a good salary. They should be the first women to go back to the work market and buy these home services, since low-skilled immigration has lowered the price of services performed primarily by immigrants.”

Lawyers, physicians, and managers represent the study’s primary categories of women with professional degrees, Cortes said. To have a successful career in one of these fields, women must work long hours, she said. Cortes’s study found low-skilled immigration has helped professional women increase their probability of working more than 50 and 60 hours a week. In particular, the estimated effect is significantly greater for women with children 5 years old or younger.

“If you look at the average hours per week a lawyer or surgeon has to work, it’s very high—50 or 60 hours,” Cortes said. “It’s more difficult for women to put in those hours—at least partly because of gender roles—because they’re also expected to take care of their kids. The question then is, Are cheaper services affecting the probability those women are working longer hours?”

The answer is a resounding yes, according to Cortes and Tessada, who compare cities with large and small immigrant populations generated by causes that are not related to demand. “What we found is that if there are many immigrants in a city, the highly skilled professional women are actually working more hours,” Cortes said. The effect is on the intensive rather than the extensive margin—that is, professional women working more hours rather than more women choosing to enter the labor force, she said.

Because the labor that immigrants perform is mostly low-skilled, many people focus on its effect on the wages of U.S. citizens, Cortes said. “For example, people say immigrants are getting more than they’re giving,” she said. “But in this case, it seems like they’re helping America’s professional women by allowing them to work and advance their careers.”

Last Updated 5/14/09