Social Security Eligibility and the Labor Supply of Elderly Immigrants

The employment rate of native men falls at a much faster rate than the employment rate of immigrants as the men near retirement age. The reluctance of immigrants to leave the labor market arises partly because of the eligibility requirements for Social Security benefits. A person needs to have worked in the United States for at least 10 years to qualify for benefits. Newly arrived immigrants have not yet accumulated the requisite employment credits and have greater employment rates than other comparably aged persons. The probability that an older immigrant is employed falls once the 10-year work rule is satisfied.