Cluster-Seminar Public Finances and Living Conditions

This paper evaluates the effects of immigration on health in the workplace. Using rich linked employer-employee data, I demonstrate that firms with a higher concentration of foreign workers experience lower rates of long-term sick leave among native employees. The effect on the total sick rate is smaller in magnitude. The results are consistent with foreign employment alleviating understaffing and/or prompting career changes, which disproportionately reduce the associated health hazards for natives. The health improvements for natives are concentrated in blue-collar industries, particularly construction, and are driven by foreigners who arrived in Germany relatively recently.