Using census data for 1996, 2001 and2007 the authors study the labor market effect of immigrationin South Africa. In this period the share of foreign bornover the total population has grown by almost fifty percent,and both the characteristics and geographical distributionof immigrants show substantial variation over time. Theauthor exploit these features of the data to carry out ananalysis that combines both the 'spatialcorrelation' approach pioneered by card (1990) and thevariation across schooling and experience groups used byBorjas (2003). The authorestimate that increasedimmigration has a negative effect on natives employmentoutcomes, but not on total income. Furthermore, we find thatskilled South Africans appear to be the most negativelyaffected subgroup of the population.