Working paper no. 1999-29
This paper reports the findings of a study of labor market niching involving 102 ethnic groups living in 216 metropolitan areas in 1990. Approximately 12 percent of the labor force of the 216 metropolitan areas studied was employed in ethnic niches. The percentage in niches was substantially higher for indigenous minority groups (American Indians, African Americans, Hawaiians, and Puerto Ricans) and for non-European groups, including those from Latin America, the Caribbean, and Asia. Also, 59 percent of employment sectors, formed by cross-classifying 47 major industries and 19 major occupations, had at least 1 percent of their workforces employed in niches, with the percentage so concentrated being higher for construction, manufacturing, and selected consumer market and professional service sectors, and selected managerial/professional, service, and blue-collar occupations. The study found that ethnic groups differ considerably with respect to the types of sectors in which they have niches. Niches in service and blue-collar occupations associated with construction, manufacturing, and consumer market industries are primarily occupied by indigenous minority and non-European groups. Niches in professional/managerial and technical occupations are dominated by European, Middle Eastern, and selected Asian groups. Although niching appears to be pervasive among some ethnic groups, for individual groups there is considerable discontinuity in the sectors in which niching occurs across metropolitan areas; few groups have multiple occupational niches within a given industry in one or more metropolitan area. Finally, workers employed in workplace jobs in which the workforce is majority co-ethnic are also likely to work in ethnic niches. It is suggested that ethnic niching emerges from economic competition resulting from changes in the relative number and sizes of ethnic populations in conjunction with the expansion/contraction of employment opportunities in local labor markets.