Same Neighborhood, Same Employer? Residential Networks and Workplace Concentration Among Immigrants

Social networks shape both international migration flows and residential settlement decisions, yet few studies address the links between job-related residential networks and employment outcomes among immigrants and their children. Using Norwegian linked employer–employee administrative data with information on detailed neighborhood locations, we study how connections between neighbors are tied to workplace sorting and wages among workers of immigrant and native background. To assess the presence of residential networks, we compare workers’ observed exposure to neighbors at work against a simulated baseline of random workplace allocation within municipalities. Our findings show that immigrants are considerably more likely to show an excess workplace exposure to immigrant neighbors, particularly coethnics from the same country of origin, compared to natives living in the same neighborhood. However, working alongside immigrant neighbors is only modestly associated with lower wages among immigrants, suggesting that these networks facilitate employment but offer limited economic benefits. In contrast, children of immigrants exhibit a weaker reliance on neighborhood-based immigrant networks and show no significant wage disadvantage when working with immigrant-background neighbors. These findings highlight how residential networks concentrate immigrants in specific workplaces, while less reliance on local networks in the second generation suggests greater integration into the mainstream economy.