This article contributes to the small Australian literature on the earnings of immigrants in the self-employment sector. Earnings functions for both the foreign-born and Australian-born are estimated, and the results show that compared with native-born workers, foreign-born workers have higher earnings in the wage/salary sector but lower earnings in the self-employment sector. Among the foreign-born, the results suggest that self-employed immigrants are less skilled compared with those who are wage/salary employed. Thus, low-skilled immigrants may be forced into self-employment. There is no evidence of immigrant 'catch-up' in the self-employment sector. Among wage/salary workers, however, immigrant wages are characterized by a 'catch-up' effect.Presented are analyses of earning determinants in foreign-born and Australian-born men in both self-employment and wage/salary employment. The 1991 Australian Census of Population and Housing statistics data were utilized in this study, which focused on the male population aged 15-64 years who has positive hourly income. Results showed marked differences in the relative earnings of immigrants in the two employment sectors. Particularly, immigrants earn more than the native-born in the wage/salary sector but earn less than the native-born in the self-employment sector. Some groups of immigrants were forced into self-employment because of their inadequate skills that limit their employment opportunities in the wage/salary sector. This study concluded that immigrants have a greater potential wage structure as compared to that of the Australian-born due to their high levels of motivation and effort related with the migration and adjustment process. Finally, the analyses demonstrated the possibility for significant improvement in the actual earning position of the foreign-born through the implementation of policies that would afford immigrants the same returns to their skills as the native-born.

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