A lot of immigration has been noted towards OECD countries since the 19 th century. In the recent past, the influx of immigrants into developed countries has witnessed a sharp increase. The problem facing these immigrants who search for greener pastures is that they receive low pay compared to the native/locals. This has become a global concern with respect to discrimination. This has led to certain nations failing to attract skilled foreign workforce due to their work policies. Such policies play a big role in limiting global expansion into these countries. This analysis aims to expose the issues that influence wage discrimination against immigrants and how they could be detrimental in building a strong national economy.
Wage discrimination has been defined by Aydemir and Skuterud (2008) as the event where employers pay two employers differently with regards to race or gender. It is evident that these factors have no direct relationship with productivity. Therefore, they are creating a suitable environment for poor business practices. To start with, the lack of information among employees concerning the productivity of immigrants has led to wage discrimination. The employers believe that the human investment made to the immigrants may yield to low returns. Secondly, these employers have a stereotypical preference on discriminating immigrants’ workers on the basis of low wage. The low wage received is enough as they are desperately seeking for an income generating opportunity (Dustmann et al. 2013).
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Factors affecting productivity have been considered the cause of wage discrimination against immigrants. Baert and Cockx assert that education in abroad is less valued in the countries where immigrants go to work (2013). Therefore, this appears to influence their productivity thus getting a smaller wage than native workers. In most developed nations, education has become the common factor relating to wage discrimination which suggests upgrading of the immigrants’ education. This will result in even smaller wages if the organization caters for the education of the immigrant.
The causes of the wage discrimination have no direct relationship to productivity. Most of the reasons are self-imposed beliefs exhibited by employers which influence the wage determination. Wage discrimination can have a serious impact on the success of an organization when the immigrant workers become aware. This can result in increased employee turnover to better alternatives. These workers will find places where they will get a better pay similar or more to the natives. They can also become demoralized thus affecting the quality of business upon realizing the presence of wage discrimination placed upon them. Wage discrimination is a poor business practice which has no relationship to high profits, effective customer experience, among other business benefits (Kampelmann & Rycx, 2016). Therefore, it does not stand as practice to be exhibited by the employer, business owners or organizations.
Arai and Thoursie (2007) denote that wage discrimination does more harm than good to a business or organization. It has been noted to be the highest influencer on job satisfaction and motivation. Therefore, a company with many immigrant workers is likely to have reduced productivity which is detrimental to the business. Immigrant workers are likely to leave their job if they constantly notice wage discrimination which leads to an increased turnover. This in turn will increase the costs of the business in the recruitment and hiring process.
This analysis reveals that wage discrimination is a poor business practice which will eventually hurt employers, businesses, and organizations. Fair and equitable wages will have an outstanding positive impact on the organization where everyone around the working place observes fairness. If a nation does not install better working policies for immigrant workers, it is likely to have a negative impact on its economy as well as limit global expansion penetrating its market.
References
Arai, M., & Thoursie, P. (2007). Gender and ethnic discrimination: an introduction . Swedish Economic Policy Review, 14(1), 2-7.
Aydemir, A., & Skuterud, M. (2008). The immigrant wage differential within and across establishments . Industrial Labor Review, 63(3), 330—359.
Baert, S., & Cockx, B. (2013). Pure ethnic gaps in educational attainment: when do they rise? Economic Education Review, 36(1), 275-299.
Dustmann, C., Frattini, T., & Preston, I. (2013). The effect of immigration along the distribution of wages . Review of Economic Studies, 80(1), 149-181.
Kampelmann, S., & Rycx, F. (2016). Wage discrimination against immigrants: measurement with firm-level productivity data . IZA Journal of Migration, 5(15), 123-145.
