Crisis, segmentation, and immigrant labor market incorporation: COVID-19 in the U.S. restaurant industry

Abstract The COVID-19 pandemic generated an unprecedented labor market shock that disproportionately affected face-to-face service sectors central to immigrant employment. This study examines whether the pandemic reaffirmed or revealed limits to the narrative of immigrant resilience that emerged from research on the Great Recession. Focusing on the U.S. restaurant industry (a large, low-wage, nontraded sector with high immigrant representation), we analyze differential employment trajectories of foreign-born and U.S.-born workers across contraction and recovery phases. We integrate three data sources: 2000–2022 CPS Annual Social and Economic Supplement data to establish long-term occupational trends; longitudinal CPS Basic Monthly data to estimate worker transitions during the pandemic; and an original nationwide survey of restaurant owners and hiring managers conducted in Summer 2021 with retrospective staffing information for January 2020 and January 2021. CPS transition results indicate that foreign-born workers experienced sharper transitions into unemployment in certain occupational segments during the contraction phase. Employer survey results suggest that foreign-born workers became increasingly concentrated in lower-wage restaurant types during recovery. These findings suggest that the national scope and mobility-restricting nature of COVID-19 constrained traditional immigrant adjustment mechanisms. Rather than uniformly reinforcing immigrant resilience, the pandemic intensified intra-industry segmentation and revealed how crisis characteristics condition immigrant labor market incorporation.