The employees of native and immigrant self-employed

Abstract

Using unique register data for Sweden we match self-employed persons to their employees. The purpose of the paper is to investigate which factors that influence the composition of the workforce in terms of national background. To analyse workforce composition we estimate the probability of only employing co-nationals in the firm. A majority of the self-employed do not have employees so the used sample constitutes a small share of all self-employed. To account for the selection in the choice of having employees we estimate a selection model of Heckman type.

We find that a higher share of immigrants in the municipality increases the probability of hiring immigrants, both for native and immigrant self-employed. We also find that the probability for immigrants to only employ co-nationals decreases with time spent in Sweden. These results point to that the proximity to people from the same region and one's network plays an important part for the employment decisions for the self-employed.

Citation

Andersson Joona, P. and Wadensjö, E. (2009), "The employees of native and immigrant self-employed", Constant, A.F., Tatsiramos, K. and Zimmermann, K.F. (Ed.) Ethnicity and Labor Market Outcomes (Research in Labor Economics, Vol. 29), Emerald Group Publishing Limited, Leeds, pp. 229-250. https://doi.org/10.1108/S0147-9121(2009)0000029011