Ethnic Enclaves and the Earnings of Immigrants

A large literature in sociology concerns the implications of immigrants’ participation in ethnic enclaves for their economic and social well-being. In particular, the “enclave thesis” speculates that immigrants benefit from working in ethnic enclaves. Previous research concerning the effects of enclave participation for immigrants’ economic outcomes has come to mixed conclusions as to whether enclave effects are positive or negative. In this paper, we seek to extend and improve upon previous work by formulating testable hypotheses based on the enclave thesis and testing them with data from the 2003 New Immigrant Survey, employing both residence-based and workplace-based measures of the ethnic enclave. We examine the economic outcomes of immigrants working in ethnic enclaves as compared to those working in the mainstream economy. Our research yields minimal support for the enclave thesis. Our results further indicate that for some immigrant groups, ethnic enclave participation actually has a negative effect on economic outcomes.