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UNITED STATES DEPARTMENT OF LABOR

Three essays on immigration policy and labor market outcomes in the U.S. (Mukherjee, 2019)

Review Guidelines

Causal Evidence Guidelines

Absence of conflict of interest.

Citation

Mukherjee Das, A. (2019). Three essays on immigration policy and labor market outcomes in the U.S. (Ph.D., Middle Tennessee State University). ProQuest Dissertations and Theses. (2292188664).

Highlights

  • The study’s objective was to examine the relationship between the extended length of time of the Optional Practical Training (OPT) program’s temporary work permit for foreign STEM graduates and labor market outcomes for domestic STEM graduates. 

  • Difference-in-differences: The authors used a difference-in-difference design to estimate the impacts of OPT on labor market outcomes for U.S. STEM graduates, using data from the National Survey of College Graduates (NSCG), a biannual survey by the National Science Foundation (NSF), and the National Survey of Recent College Graduates (NSRCG) spanning the years of 2003 through 2013. They used a statistical model to compare the annual salary, labor force participation, and hours worked per week of US-born STEM graduates to US-born non-STEM graduates before and after the change made to OPT. 

  • The study found no relationships between the OPT 2008 extension and domestic STEM graduates’ annual salaries nor labor force participation. The authors find a negative relationship between the policy change and hours worked per week for US born STEM graduates. 

  • The quality of causal evidence presented in this report is low because the authors did not ensure that the groups being compared were similar before the intervention. This means we are not confident that the estimated effects are attributable to the extension of OPT; other factors are likely to have contributed. 

Intervention Examined

Optional Practical Training (OPT) Program

Features of the Intervention

The OPT program allows international students on F-1 visas a work visa for 12 months post-graduation. In 2008, international students in STEM were given an optional 17-month extension for their work visa. This work visa often puts young graduates on the track to acquire an H1-B work visa, which is a three-year U.S. work visa, and can be extended for an additional three years in some cases. The target population is STEM domestic graduate students from 2003-2013 across the United States. 

Features of the Study

The authors use a difference-in-difference study design to compare salary and employment outcomes between domestic STEM graduates and non-STEM graduates before and after the 17-month OPT extension in 2008 was implemented. The treatment condition included 35,428 students whose major falls under DHS's definition of a STEM major between 2003-2013. The control group consists of 21,728 students who did not pursue a STEM major between 2003-2013. STEM majors tend to have more male students, less unemployment, and earn higher annual salaries than non-STEM majors. The sample age groups were mostly the same. The authors use data from the National Survey of College Graduates (NSCG), a biannual survey by the National Science Foundation (NSF), and the National Survey of Recent College Graduates (NSRCG). Labor force outcomes are captured in the NSCG. The NSF biannual survey breaks down labor market outcomes such as annual salary and weeks worked in a year by field and level of degree obtained. The NSRCG was discontinued and combined with the NSCG and American Community Survey (ACS) after 2010. 

Findings

Employment

  • This study found no statistically significant relationship between OPT and labor force participation for domestic students in STEM fields. 

  • This study found a negative statistically significant relationship between OPT and hours worked per week for domestic students in STEM fields.

Earnings and Wages

  • This study found no statistically significant relationship between OPT and salary for domestic students in STEM fields. 

Considerations for Interpreting the Findings

The author did not account for preexisting differences between the groups before program participation or include sufficient control variables. These preexisting differences between the groups—and not OPT—could explain the observed differences in outcomes. 

Causal Evidence Rating

The quality of causal evidence presented in this report is low because the authors did not ensure that the groups being compared were similar before the program implementation. This means we are not confident that the estimated effects are attributable to OPT on the labor outcomes; other factors are likely to have contributed. 

Reviewed by CLEAR

February 2023