This paper investigates how labor markets adjust to influxes of immigrants over the short run taking into account heterogeneity of ethnic enclaves in terms of the extent of their linguistic assimilation. We construct a panel data set for Germany at the regional level over the period covering 2013--2019 using data from Data for Integration Project, Eurostat, Google Trends, and the OECD. First, effects of immigration on native employment as well as conditions when those effects are positive and negative are derived theoretically using a search and matching model with a spatial component. Second, we empirically test predictions of the economic model in a shift-share design by proposing a new instrument i.e. linguistically unassimilated and linguistically assimilated shares. Isolated enclaves are represented by the former and integrated enclaves by the latter while shares are obtained by applying several correction factors to Google Trends ranks to measure the degree of linguistic assimilation of various immigrant groups. We find that a 10% increase in the relative supply of immigrants in linguistically assimilated areas increases growth in log native employment on average by 0.16 percentage points. In contrast, a 10% increase in the relative supply of immigrants in linguistically unassimilated areas doesn't result in contemporaneous growth in log native employment. The study highlights the importance of taking into account differences in linguistically assimilated immigrants to understand immigration's effects on native employment.

Barriers to entry into occupation limit labor supply. One of the examples of such barriers is occupational licensing. In addition to regulating entry, some licensed occupations may place additional restrictions on the number of practitioners permitted to practice. Latin notaries are regulated in that way. Using data on exams and employment histories of all notaries in Russia for 1992-2022, this paper studies the effects of two labor market policy changes. First, using two way fixed effects model, we study the de-licensing reform in 2016 which allowed notaries to practice without a license. We find that the reform did not result in an apparent increase in official labor supply, since there are caps on the number of practitioners. However, the actual number of practitioners increased through a legal loophole i.e. through an increase of people who passed an exam and substitute existing notaries. Second, decomposing the decision to substitute into market expansion and replacement effects, we find that the former dominates the latter. Third, we further analyze the changes in the maximum allowed number of practitioners after the reform. Comparing areas where caps are binding, increases in the caps result in a greater increase in the number of people who passed an exam. We propose a simple economic model that explains this. The mechanism behind is the deviation of the actual number of practitioners from socially optimal number. We conclude that partial removal of the barriers to entry through the de-licensing reform had an intended positive effect on labor supply, albeit not easily observable, due to caps on the number of practitioners. Increasing the caps on practitioners, when they are binding, result in larger increases in labor supply, therefore those caps are set low in certain areas and are subject to revision.