Labor market competition from immigrants is most intense for natives with the lowest levels of education. For example, while immigrants in the U. S. comprised only 13 percent of the working age population in 2000, they made up 28 percent of the population with less than a high school diploma, and over half of all those with less than 8 years of schooling. According to the OECD (2010), the advanced countries are home to 88 million migrants who have no tertiary educations, accounting for 76percent of their total foreign-born population. In countries such as the U.S. and Canada, undocumented migrants from countries such as Mexico, Central America and the Philippines account for a large part of the unskilled immigration flow (Goldin et al, 2011). Undocumented migration is also a prominent phenomenon in France, the UK, Italy and Spain.

This paper surveys selectively and critically the recent literature on the effects of unskilled migration on advanced economies. Although the main focus is on the wages of the unskilled, the review looks more broadly at the effects on economic growth, employment, and the government budget.