DID THE ENGLISH DEFICIENCY EARNINGS PENALTY CHANGE FOR HISPANIC MEN BETWEEN 1979 AND 1989

Objective. Recent research suggests that the labor market returns to e ducation and experience increased during the 1980s in the United State s. I analyze whether Hispanic men also witnessed an increase in Englis h proficiency returns during this time. Methods. I use data from the 1 980 and 1990 Public Use Microdata Samples, which provide categorical i nformation on verbal English skills. I collapse these categories into an English deficiency index. Results. Using this index in an earnings function, I find that on net the English deficiency earnings penalty o f college graduates rose between 1979 and 1989 relative to the penalty obtained by their less educated peers. I further discuss this earning s penalty in two enclave economies-Los Angeles and Miami. Changes in t he relative penalty appear to vary between these enclaves and the rest of the country, although English deficiency still relates to lower ea rnings in these areas. Conclusions. Policies designed to enhance Engli sh proficiency have long-term labor market value, even in enclave econ omies. Moreover, at the national level, my findings are consistent wit h increasing returns to skill. Future research should explore ethnic- and gender-related issues of language proficiency in current labor mar kets.