Labour Market Outcomes

A follow up to the 2005 RBC study, The Diversity Advantage: A Case for Canada's 21st Century Economy, this report estimates that better recognition of immigrants' skills would result in $30.7 billion in increased incomes for immigrants, equivalent to about 2.1% of GDP in 2006.

The study repeatedly emphasizes why it is particularly troubling that the economic well being of immigrants entering Canada has been deteriorating over the past 25 years. Below are some key arguments and stats: • Gap between earnings of newcomers and Canadian-born individuals on entering the labour market is widening. • While immigrants in the past could hope to close that earnings gap with time, the ability to do so today is in question. • More newcomers are also ending up in positions that underutilize their skill sets and their unemployment is significantly higher than Canadian-born individuals. • Their low starting point has meant that the differential would remain substantial even after many years living in Canada. • These trends mean that immigrants are more likely to experience a period of living in poverty. • 35.8% of immigrant families were living in poverty 2003.

This study focuses on better understanding why discrimination by name ethnicity and city of experience occurs; whether it can be attributed to underlying concerns about worker productivity or simply prejudice and whether it is likely conscious or not. The study finds that employers justify name and immigrant discrimination based on language skill concerns, but incorrectly overemphasize these concerns without taking into account offsetting characteristics listed on the resume. Masking names when deciding who to interview, while considering better ways to discern foreign language ability, may help improve immigrants’ chances for labour market success.

The author assesses the impact of immigrant workers on the US economy and labour market in terms of total output, income per worker, and employment. He finds no significant impact of immigration on these areas in the short, medium, and long terms suggesting that the US economy absorbs immigrants and expands net job growth.