The 'American Dream' Falters for Second-Generation Immigrants

Lionel Santibañez is better off because his parents came to America. His father was illiterate and his mother spoke little English when they arrived in Texas from Mexico in 1980. But they sacrificed, saved, and pushed their kids into good schools - and today Mr. Santibañez is a college graduate who works at the M.D. Anderson Cancer Center in Houston as a scientific editor.

"Absolutely I've had more opportunity than my parents," he says.

Raja Patel, on the other hand, is a second-generation immigrant who worries whether he's lived up to his parents' example. True, he's got a good job as a network engineer for an investment bank in New York City. But his father - who emigrated from India in the late 1960s - was a civil engineer who owned small stores on the side.

"I'm definitely not doing better financially than my dad," says Mr. Patel.

For hundreds of thousands of immigrants to the US, the American dream lives. Their families prosper, with their children becoming more affluent than they were, according to a new report.

"The American engine of economic assimilation continues to be a powerful force," concludes the Pew Charitable Trust study of immigrant economic mobility.

But it's a force that may be faltering. The gains of second-generation immigrants have shrunk in recent years - in part because first-generation immigrants now are poorer than at any time since World War II.

"I've been studying this stuff for a long time, and I was surprised by the amount of the first generation that is in bad shape," says Ron Haskins, the study's author.

The United States is now experiencing a wave of immigration comparable to the largest in its history. More than 1 million immigrants enter the United States legally every year, up from about 300,000 in the 1960s. An estimated 500,000 illegal immigrants also enter the US annually, according to Pew.

The effect this influx has on the pay and prospects of nonimmigrant workers is a contentious issue. Some economists forcefully argue that immigration hurts the poor already present in the country - particularly poor African-Americans. Others insist that the US economy is large enough to accommodate the newcomers easily.

The experience of the immigrants themselves, and the progress of their children, may receive less political attention. Yet immigrant economic mobility - or lack of it - could affect the US economy as a whole profoundly in coming years.

The American economy remains an escalator, carrying many children of immigrants to a better life, Pew found. Second-generation immigrants do much better than their parents, on average. They do so well, in fact, that they surpass the earnings of those whose families have lived in the US much longer. Second-generation immigrants make 6.3 percent more than nonimmigrant workers, according to data compiled by Pew.

Often this jump for the children is due to parental initiative and hard labor. David Hul's mother and father, for instance, fled Cambodia's cruel Khmer Rouge regime during the era of the Vietnam War. They came to the US in 1981, eventually settling in Lowell, Mass.

Lack of English meant that Mr. Hul's father - an engineer - had to work long hours to eventually reach an employment level commensurate with his skills. Meanwhile, the senior Huls ran a convenience store on the side.

Hul, a Boston-based marketing manager for a technology firm, says he has not had to worry about making a living as much as his parents did. He says he's confident he will eventually be more financially successful than they were.

But he knows his parents' drive helped him to his current economic position.

The nationality diversity of immigrants - both illegal and legal - today is far different from in decades past. In the 1960s, Europe and Canada accounted for half the newcomers to the US. Now, they make up less than 20 percent.