It means if you put enough people of different identities in close proximity, the inevitable result is "war". Maybe not Yugoslavia type war, but warfare of one type or another, including "simple" economic warfare, which was one of the causes of The War Between the States, and had been a frequent problem for the young Republic prior to that, but it also happens on very small scales, see for example the various non-native merchant classes in so many countries, and that doesn't require large numbers on both sides.

There's a social scientist who's research said much the same thing, who published his data early but otherwise sat on his results for more than a decade, Robert Putnam. As Wikipedia puts it, "His conclusion based on over 40 cases and 30,000 people within the United States is that, other things being equal, more diversity in a community is associated with less trust both between and within ethnic groups." (emphasis in original: https://en.wikipedia.org/wiki/Robert_D._Putnam#Diversity_and...).