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Immigrant Economic Outcomes in Canada over the past three decades

Discuss about the Immigration and Ethno Cultural Diversity in Canada.

Canada is known for having one of the highest immigration rates among OECD countries. It constitutes inflows of residents from different nations at a rate of approximately 0.8% of the overall population. Most of them stay permanently in the nation and thus creating pressure on the existing labor force. As per demographic projection diversity in terms of Ethnicity culture in Canada will increase rapidly by 2031.Studies reveal that immigrants in Canada could constitute 63% of total population in Toronto, 31% of the population in Montreal and 59% of overall population in Vancouver.

The immigration rate in Canada shows a steady rising trend overtime. In job market there is always an attempt to maintain a balance in the rate of employment between these immigrants and the natives of Canada. In terms of female employment rate the discrepancy between Canadian and non Canadian is lowest here as compared to other OECD nations (Hawthorne, 2016). This statistics is negligible in case of male members in the labor force. Despite several efforts the immigrants in Canada still have to face challenges in adjusting with local labor force.

Census survey of 2006 indicates that disparities of income between the immigrants and born Canadian member of labor force are increasing. This trend remained throughout the first decade of 2000s.  Statistics obtained from 1980 showed that income of male immigrants in the labor force is almost 85% of every dollar as received by born Canadian male members. After that the ratio had declined to 67% in 2000 and became even lower in 2005 with the rate being 63%. This indicates the gradual worsening condition of immigrants in Canada. The consequent ratios for female counterparts are 85%, 65% and 56% in the respective years (Li & Sweetman, 2014).

The annual employment report of Longitudinal Immigration Database (LMDB) depicts two persistent trends for all documented entries. One is that there is a rising trend for overall income in Canada. Discrimination in income distribution is noted between the two different groups of immigrants- one is economic class that is the principal job applicants and other group consists of all other immigrants except those in economic class. The condition of immigrants in economic class is better than others with the economic class enjoying a significant higher income (Ng & Metz, 2015). The trend is apparent for initial time period as well as overtime. This group accounts a high participation rate and greater attachment than others in the labor market.

Factors contributing to immigrants trend in Canada

The proportion of economic class is low as compared to total number of immigrants. Thus, the increasing participation of economic class in immigrants fails to boost the overall condition of the whole immigrant group. Since 1990s, the performance of immigrants in different economic indicators is highly uneven. The economic condition in Canada was very poor in the beginning of 1990s. Thus, immigrants who came during this time had gone through a challenging condition as reflected from their low employment earnings. After that income of immigrant had improved especially the later group experienced a growth in their income. Skilled members in the labor force were mostly concentrated in the IT sector. With depression in IT sector these workers were badly affected and this fact is revealed from their earning profile in 2000-2008 (Sweetman & Warman, 2013).

Trends of low income among the migrants were almost doubled in between 1980-1995.  In 1980 the low income rates was 25%. This rate increased to 47% in 1995. In 2000 the condition slightly improved and the rate settled in between the two extreme with the rate being 36% in 2000. In correspondence, the rates of low income population for born Canadian residents are 17% and 14% in 1980 and 2000 respectively (Hiebert, 2016). Census report in 2006 had projected that the low income rate among the immigrants would continue to dominate the rate for local residents. Another feature of low income trend is that dominance of low income is more prevalent among those who recently entered in the country. There is a clear trend that with increase in the number of years low income rate declines among the immigrants.

The economic outcomes from the immigrants are considerably lower than that expected. Several factors are responsible for these low economic outcomes. Some of the major factors are discussed here. Over the past two decades the labor market in Canada experienced a decline of 40% than earlier (Innis, 2017). The direct effect of worsening labor market condition is on the immigrants members of the labor force. One major factor contributing to the deterioration of labor market condition is the turmoil of IT sector in Canada. In 2000 there was a bust in IT sector hurting employment and aggravating the incidence of low income in the economy. IT industry absorbs large pool of skilled laborer and generates high income jobs. Thus, downturn in this sector has a notable impact on the economy.

Impacts of immigration trend on Canadian social cohesion over time

The return on foreign education has been decreased. This is because of the changes taking place in the source nations. The striking fact is that there is no evidence of decline in educational return from different nation overtime. Overall declination in return has been resulted from the increasing entry of immigrant having lower return (Hollifield, Martin & Orrenius, 2014).

Immigrants doing jobs in the nation are either unemployed or underemployed. In the national job market experience of foreign workers are not considered as valuable as for domestic laborers. This discriminating treatment between the domestic and foreign workforce is responsible lower outcomes from the immigrants (Guruge & Butt, 2015).

Another factor that works against the immigrants coming to the country is their limited knowledge of official language. Inability to speak official language restricts their access to different economic aspects. It is not possible to capture the exact impact of language knowledge on economic performance (Patterson, Kyu, & Georgiades, 2013). Hence, indirect measures are used to trace the impacts. Different evidence however points that knowledge of language acts as a significant barrier to the economic success of the immigrants.

In addition to these factors internal competition with born Canadian population hurts economic outcomes of immigrants (Béchard, 2015). The Canadian members of labor force are more educated as compared to their immigrant counterpart. The combination of high education and work experience provides a better opportunity to the local residents and enhance their performance and outcome. In this respect immigrants lag behind and accounts poor economic performance.

In the phase of rising immigration and resulted ethnic diversity, the effects on social cohesion have become an increasing concern for most of the western nations. In this regard, government has two policy perspectives. One is to accept the diversity in celebrating manner and show respect towards the cultural diversity. However, state should ensure that minorities are given freedom to express their own cultures (Meer & Tolsma, 2014).  Another policy focus can be towards building an integrated society and establishing uniform national identity above all the cultural differences. Even both the policies can be taken simultaneously.

However for Canada the goal of social integrity is given priority and the nation is almost free from the clashes between the state and minority groups. Despite increasing ethnic diversity and increasing share of nation population belonging to minority groups social integration has not yet break down (Taylor & Foster, 2015). Though there are problems pertaining to provide proper accommodation or allocate jobs to everybody in the labor market there are no evidence of social disharmony in Canada. There are several factors responsible for this outcome.

Policy makers in Canada have never sort to establish a single national identity in Canada. English and French were the two founding classes in Canada in 1867. Region of Ontario was English dominated region and Quebec was the region for French (Hyman & Meinhard, 2016). The tradition of treating every class equally starts from the very beginning and since then the tradition continues. Since then steps had been taken to secure all rights even for those who live outside their native regions. The recent instance of this tradition is the establishment of Canadian Charter of Rights and Freedom.

Long before creation of the organization Canada had already known for its immigration culture and also contributed to growth of nation. This organization further strengthens this culture. Natives in Canada consider it as a pride in welcoming immigrants coming there (Berry, 2013). They happily accept diversified culture of different citizens coming from different parts of world. While Canada stared this trend long years back most of the European nations just started thinking about it. This evidenced the presence of a different perspective among Canadian people.

Sometimes education base of immigrants are at per or even stronger than that of native Canadian. These immigrants contribute in building a society with a high knowledge base. Studies indicate that immigrants coming in Canada is often more educated than those in United State or other European countries (Ferrer, Picot & Riddell, 2014).

Politicians in every stages of administration hold the view that flow of immigrants is one of the important aspects for improving economy’s health. In fact often policies are designed to attract immigrants for betterment of domestic economy.  Even citizens in the nation agree with the view of politician. Like policymakers they also value the presence of immigrants in the nation. Steady flow of immigrants is considered as important for maintaining a stable population growth and bringing prosperity in the nation. There is no evidence of adaption of policy to prevent entries of immigrants. Thus, there is no instance of any dissatisfaction among local residence regarding the issue of immigration in the nation.

In Canada policies are also taken to help newly entered immigrants in building place in Canadian Society. Democratic rights given to immigrants in Canada are almost same as those given to born Canadian. Turnout rate of voters are significantly lower among immigrants than Canadian people. Immigrants are also allowed to participate in designing legislative policies. Nearly 15 to 20 members in parliament belong to minority groups (Ferrer, Picot & Riddell, 2014).

Ethnical diversity resulted from existence of people of different culture has a slight negative impact on social integration. Under the purview of dominance by one particular class of immigrants born native group might react inversely (, 2017). This possibility is least in Canada. Immigrants coming here belong from such a wide range and have such a diverse culture that it is difficult for any one group to dominate over others or born Canadian natives

In response to a declining immigrants outcome government in Canada has taken several policies to improve economic performance and outcome. Concerns are given in following major areas.  Policies are taken for development of labor market in line with recent boom in commodity prices. There is need for additional provinces to accommodate immigrant labors keeping in mind the growth of labor force. Importance given on entry of immigrants with a view that within next few years Canada may experience a labor shortage and that will hamper countries productivity. Federal government in Canada has tried to influence participation of provincial government for achieving these goals. Given below are some of the policies related to improvement of output performance.

Program of Provincial Nominee

There are evidences of wage discrepancy in provinces. Look after the needs of immigrants is a responsibility for both federal and provincial government. Each needs to fulfill their part of responsibilities. However, the major part of responsibility is on federal government. There are few provinces that conduct their own skilled program. Only Quebec carried a program for skilled workers and hence has is responsible in choosing own immigrants (Elrick & Lightman, 2016). Province Nominee (PN) program gives other provinces rights for choosing their immigrants as like Quebec. There are two primary objectives of this program. First is to eliminate the concentration of immigrants in few cities and accommodate more immigrants in small states or province to make a uniform flow of immigrants all over the nation. Another important goal s to crate appropriate employment opportunities in those regions for the immigrants. For this the employers’ needs are first taken care of. Initiatives started with fulfilling short demands in labor market. Since t is a newly introduced there is little scope of evaluation of concern policy impacts.

However, there are some evidences of success of this program as reflected from almost no decrease in the immigrant’s retention rate following execution of this policy. Overall retention rate in provinces were 80% during 2000-2008 as accounted by PN. However, this rate varies significantly among regions. The rate was even over 95% in Alberta while it was comparatively lower in Atlantic province with the rate being 60% (Knowles, 2016). This suggests PN program is more effective than Federal Skilled Workers (FSW) program. There is a contrast in policy objectives between FSW and PN. FSW focuses on long term outcome while PN aims to resolve short term issues.

Program for Temporary Foreign Worker

Temporary Foreign Worker (TFW) program is used to look after the needs of labor force in particular region in very short run. The program include several other programs like solving problems of low skilled workers engaged in seasonal occupation,  focus also given on workers who are semi skilled or unskilled workers. Even high skilled workers are also come under broad category of the program. Care is given to counteract the possible negative impact of the program in the long run (Akbari & MacDonald, 2014). The expected negative impacts are related to uncertainty of workers regarding going back to home or staying permanently in Canada. There is also possibility that workers might face exploitation by a few groups of employers. Uncertainty exists about the adjustment of workers after entry of skilled workers in the labor market. Another threat arises from the possibility that flow of temporary workers might push wages down. Time period for TFW’s employment is fixed as four cumulative years. The program is widely accessed by employers able to conduct transferability of skills in the labor market.

Evaluation of the program finds that male member of TFW accounts a higher income than those newly entered in the labor market. This is because workers under TFW program have a better employment opportunity than those outside the program. Research on human capital reveals that outcomes from TEW program are greater than earlier (Boucher & Cerna, 2014)

Canadian Experience Class program

This program started in 2008.  As per the program temporary skilled workers, foreign students holding degrees from any Canadian college and existing workers having at least one year of experience are eligible to apply in jobs with permanent status. This is a large scale program. In response to this program approximately 30,000 applicants made successful transition from temporary workers to a permanent one (Root et al., 2014). This policy is in line with the objectives of improving the status of newly entered immigrants. The program has given success through active participation of educational institution and employers in the economy.

However there is a language requirement to enter in the program. Applicants despite having high educational qualification are not eligible for admission in the program if they do not have proficiency in French and English language. The success of the program is revealed from the fact that earlier male temporary foreign workers and foreign students becoming permanent residence under the program enjoyed earning advantages over those considered under point system (Banerjee, 2013). Hence, reflects the success of the program even within a small span.

Ministerial Instruction   

Ministerial Instruction designed in Federal level aims at filling the occupational gaps in the economy. With this legislation Canadian Minister and department accesses to records regarding immigrants joining in a particular occupation and devise a control on that number. As per ministerial instruction there are restrictions on number of applicants for a particular job and instruction are issued more than once in a year depending on needs. The program starts from 2008. During this year application limit for TFW were within 36 occupations while in June 2010 the number decreased to 29 (, 2017). However rationale behind selecting some occupation and leaving some other are not very clear. Probably screening of occupation is done depending on labor demand in occupation. Whatever be the reason, it attempts to reduce application backlog among the immigrants.

Federal Skilled Program

Federal Skilled Program is a recent addition to steps taken for improving immigrants’ status. Under this program skilled workers get a job opportunity in 43 particular occupations. At times of selection applicants need to produce a valid proof of their experience in skilled trade sector, proof of required language ability, authorized qualification certificate from any province or territory and must meet other requirements National Occupational system (, 2014).

Government in Canada has actively taken some steps toward improving betterment of immigrants’ status. However, there are some more things to be done to get complete success in this regard. Selection of skilled individual is the key to success of immigration system in Canada. Another important aspect is taking well care of those immigrants who have just arrived and help them in settling. For this, assistance should be given in improving their language proficiency, establish a good social network and help them to find jobs in different occupation.

In order to increase job availability to the immigrants’ employers in Canada should have clear assessment regarding impact on labor market. This will help them to offer appropriate jobs to foreign labor force. The impacts are to be determined through a complete assessment conducted by federal government. The assessment captures likely impact of hiring an immigrant on national labor market.

In addition to focusing on skilled workers attention should also be given for creating suitable job opportunities in low skilled jobs. Government should arrange permanent residence for low skilled immigrants. This will resolve labor shortage problems in low skilled sectors like agriculture. At the same time reliance on temporary foreign workers will also be reduced.

International students having high education and skill are able to make quick adjustment with domestic labor market and easily get jobs in skilled sectors. Thus, making international students permanent residence increase the quality of national labor force. To make them permanent residence privileges should be given in terms of providing them express entry points. It has been observed that despite having a large pool of human capital, there are only a few students who have been selected to Canadian Express Entry (Picot & Sweetman, 2017). In order to increase this number federal government should relax restriction imposed in terms of experience requirement.

One of the major reasons for lower immigration outcome is obstacles faced by newly entered immigrants to find suitable job and settle. This issue needs to be resolved.  Having a strong professional and personal network is the only way out to this problem. Thus, different government agencies and communities should help the newcomers to build or strengthen their network. Steps towards building a strong network can be initiated within different profession, between available sectors and even throughout a broad spectrum of community.

All the barriers to systematic employment of immigrant before and after arrival should be redundant. Focus should be given on services even before their arrival. These services include alternative career opportunities, sharing information in easy language. This is expected to help a newly entered member to make a right choice of profession. Appropriate training program in line with available job options should also be arranged.


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