June 2020

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CENTRE FOR THE
STUDY OF LIVING
STANDARDS

THE IMPROVED LABOUR MARKET PERFORMANCE
OF NEW IMMIGRANTS TO CANADA, 2006-2019

Kimberly Wong
June 2020
CSLS Research Report 2020-03

01

The Improved Labour Market Performance of
New Immigrants to Canada, 2006-2019
Abstract
This report provides a descriptive analysis of the labour market outcomes of new
immigrants to Canada from 2006 to 2019. Using data from the Labour Force Survey, it focuses
on four labour market indicators: participation, unemployment, and employment rates, as well as
average hourly wages. It compares trends in labour market outcomes among very recent
immigrants (5 years or less since immigration), recent immigrants (5-10 years since
immigration), and Canadian-born workers. This report finds that new immigrants are on average
younger and better educated than the Canadian-born. As a result, their labour force participationand employment rates were comparable to, if not better than, those of the Canadian-born.
However, the unemployment rates of new immigrants were higher, and average hourly wages
were lower. Over the 2006 to 2019 period, very recent immigrants enjoyed an absolute andrelative improvement in all four indicators. Recent immigrants enjoyed an improvement in all
four absolute indicators and three of four relative indicators; relative hourly wages were theexception.

2

The Improved Labour Market Performance of
New Immigrants to Canada, 2006-2019
Table of Contents
Abstract ........................................................................................................................................... 1
List of Tables .................................................................................................................................. 3
List of Charts................................................................................................................................... 3
Executive Summary ........................................................................................................................ 5
Introduction ..................................................................................................................................... 9
I. Literature Review ...................................................................................................................... 10
II. Data .......................................................................................................................................... 14
III. An Overview of the Labour Force by Immigrant Status ........................................................ 15
A. Educational Attainment of Workers by Immigrant Status ................................................... 18
B. Trends in Population, Labour Force, and Employment by Immigrant Status ..................... 20
IV. Immigrant Labour Market Outcomes in Canada .................................................................... 22
A. Participation Rate by Immigrant Status and Education level .............................................. 22
B. Employment Rate by Immigrant Status and Education Level ............................................. 27
C. Unemployment Rate by Immigrant Status and Education Level ......................................... 32
D. Average Hourly Earnings of Employees in Canada by Immigrant Status ........................... 38
V. Comparison with National Household Survey and Census Estimates ..................................... 44
VI. Explaining the Improved Labour Performance of New Immigrants ...................................... 49
VII. Summary and Conclusion ..................................................................................................... 52
References ..................................................................................................................................... 58

3

List of Tables
Table 1: Summary of Results from Studies in the Literature ....................................................... 11
Table 2: Labour Market Estimates for Canada by Immigrant Status and Highest Level of
Educational Attainment, 2019 ...................................................................................................... 16
Table 3: Comparing LFS and NHS/Census Estimates for Canada by Immigrant Status, May
2006, May 2011, and May 2016 ................................................................................................... 44
Table 4: Average Employment Income in Canada by Immigrant Status and Highest Level of
Educational Attainment According to the 2006 Census, 2011 NHS, and 2016 Census ............... 46
Table 5: Comparing LFS and Census Relative Earnings/Average Hourly Wages in Canada
by Immigrant Status and Highest Level of Educational Attainment, 2006 and 2016 .................. 48
Table 6: Absolute Change in Labour Market Outcomes for New Immigrants, 2006-2019 ......... 52
Table 7: Change in Labour Market Outcomes for New Immigrants Relative to Outcomes of
the Canadian-Born in Canada, 2006-2019 .................................................................................... 53
Table 8: Average Labour Market Outcomes for New Immigrants, 2006-2010 and 2015-2019 .. 54
Table 9: Average Labour Market Outcomes for New Immigrants Relative to Outcomes of
the Canadian-Born in Canada, 2006-2010 and 2015-2019 ........................................................... 55
Table 10: Summary of Outcomes ................................................................................................. 56

List of Charts
Chart 1: Share of Workers in Canada by Immigrant Status and Education Level, 2019 ............. 19
Chart 2: Working-Age Population, Labour Force, and Employment in Canada by ImmigrantStatus (Compound Annual Growth), 2006-2019 .......................................................................... 21
Chart 3: Participation Rate in Canada by Immigrant Status and Education Level, 2019 ............. 23
Chart 4 : Participation Rate in Canada by Immigrant Status and Education Level, 2006-2019... 23
Chart 5: Change in Participation Rate in Canada by Immigrant Status and Education Level,
2006-2019 ..................................................................................................................................... 25
Chart 6: Participation Rate Relative to the Participation Rate of the Canadian-Born in
Canada by Immigrant Status and Education Level, 2006-2019 ................................................... 26
Chart 7: Employment Rate in Canada by Immigrant Status and Education Level, 2019 ............. 28
Chart 8: Employment Rate in Canada by Immigrant Status and Education Level, 2006-2019 ... 28
Chart 9: Change in Employment Rate in Canada by Immigrant Status and Education Level,
2006-2019 ..................................................................................................................................... 30
Chart 10: Employment Rate Relative to the Employment Rate of the Canadian-Born in
Canada by Immigrant Status and Education Level, 2006-2019 ................................................... 31
Chart 11: Unemployment Rate in Canada by Immigrant Status and Education Level, 2019 ...... 33

4Chart 12: Unemployment Rate in Canada by Immigrant Status and Education Level, 20062019............................................................................................................................................... 33
Chart 13: Change in Unemployment Rate in Canada by Immigrant Status and Education
Level, 2006-2019 .......................................................................................................................... 34
Chart 14: Unemployment Rate Relative to the Unemployment Rate of the Canadian-Born in
Canada by Immigrant Status and Education Level, 2006-2019 ................................................... 36
Chart 15: Average Unemployment Rate of New Immigrants Relative to the Unemployment
Rate of the Canadian-Born in Canada by Education Level, 2006-2019 ....................................... 37
Chart 16: Nominal Average Hourly Wages in Canada by Immigrant Status and Education
Level, 2019 ................................................................................................................................... 38
Chart 17: Real Average Hourly Wages in Canada by Immigrant Status and Education Level,
2006-2019 ..................................................................................................................................... 39
Chart 18: Real Average Hourly Wages in Canada by Immigrant Status and Education Level(Compound Annual Growth), 2006-2019 ..................................................................................... 40
Chart 19: Average Hourly Wage Relative to the Canadian-Born Wage in Canada by
Immigrant Status and Education Level, 2006 and 2019 ............................................................... 41
Chart 20: Average Hourly Wage Relative to the Canadian-Born Wage in Canada by
Immigrant Status and Education Level, 2006-2019 ..................................................................... 42
Chart 21: Unemployment Rate in Canada, 2006-2019 ................................................................. 50

5The Improved Labour Market Performance of
New Immigrants to Canada, 2006-2019
Executive Summary
This report provides a descriptive analysis of the labour market performance of new
immigrants. Using estimates from the Labour Force Survey, our analysis evaluates participation,
unemployment, and employment rates, as well as average hourly wages. This report compares
trends in labour market outcomes from 2006 to 2019 among very recent immigrants (5 years orless since immigration), recent immigrants (5-10 years since immigration), and Canadian-bornworkers. We conclude that the labour performance of new immigrants generally improved
between 2006 and 2019.
As a younger and more educated population compared to the Canadian-born, newimmigrants had high participation and employment rates, which increased in both absolute andrelative terms over the period. These high rates, however, were unable to absorb all new
immigrants in the labour force, resulting in unemployment rates remaining above that of theCanadian-born. However, the unemployment rates of new immigrants decreased significantly inabsolute and relative terms from 2006 to 2019. Improvements in wages were less impressive.
While the real wages of new immigrants increased, as did the relative wages of very recent
immigrants, the relative wages of recent immigrants fell. Given their lower average age andhigher education relative to the Canadian working-age population, new immigrants represent an
important strength for the Canadian economy, from the perspective of their contribution to thelabour force and to tax revenues. This contribution could be even greater if the gaps inunemployment rates and relative wages were reduced further.

Absolute Change in Labour Market Indicators
Recent and very recent immigrants enjoyed substantial improvements in absolute labour
market outcomes from 2006 to 2019. Very recent immigrants (those who have settled in Canada
for 5 years or less) experienced the largest improvement in absolute rates. The following are key
trends in absolute rates:The participation rate of very recent immigrants increased by 5.4 percentage points from65.3 per cent in 2006 to 70.7 per cent in 2019. The rate of recent immigrants increased by
4.7 percentage points from 71.5 per cent to 76.2 per cent. These increases were driven inpart by an increase in the share of immigrants with post-secondary education, who had
relatively higher participation rates than workers of other education levels. The
participation rate of the Canadian-born decreased by 2.5 percentage points from 68.7 per6cent to 66.2 per cent. Note that by 2019 the participation rates of both very recent andrecent immigrants exceeded the rate of the Canadian-born by 4.5 and 10.0 percentage
points, respectively.
Of all the outcomes, the employment rates of new immigrants experienced the largest
increase from 2006 to 2019. The employment rate of very recent immigrants increased by
6.8 percentage points from 57.2 per cent in 2006 to 64.0 per cent in 2019, while the rateof recent immigrants increased by 6.0 percentage points from 65.2 per cent to 71.2 per
cent. In contrast, the employment rate of the Canadian-born decreased by 2.0 percentage
points from 64.5 per cent to 62.5 per cent. Note that by 2019 the employment rates ofboth very recent and recent immigrants exceeded the rate of the Canadian-born by 1.5
and 8.7 percentage points, respectively.

The unemployment rates of new immigrants exceeded the rate of the Canadian-born
throughout the 2006 to 2019 period. However, the unemployment rate of very recent
immigrants decreased by 3.0 percentage points from 12.5 per cent in 2006 to 9.5 per centin 2019, while the rate of recent immigrants decreased by 2.3 percentage points from 8.8
per cent to 6.5 per cent. The unemployment rate of the Canadian-born decreased by only
0.6 percentage point from 6.1 per cent to 5.5 per cent. Note that by 2019 theunemployment rates of both very recent and recent immigrants still exceeded the rate of
the Canadian-born by 4.0 and 1.0 percentage points, respectively.

Real hourly wages grew for recent and very recent immigrants from 2006 to 2019. Forvery recent immigrants, real wages in constant 2012 dollars grew from $17.86 in 2006 to$20.93 in 2019 at a rate of 1.2 per cent per year. For recent immigrants, real wages inconstant 2012 dollars increased from $20.22 to $22.38 at a rate of 0.8 per cent per year.
The Canadian-born wage in constant 2012 dollars increased from $22.05 to $25.25 at a
rate of 1.1 per cent per year. Note that by 2019 very recent immigrants still earned $4.32
less than the Canadian-born wage, and recent immigrants still earned $2.87 less than the
Canadian-born wage.

Relative Change in Labour Market Indicators
The relative participation, employment, and unemployment rates of new immigrants also
improved significantly from 2006 to 2019. The improvements for relative rates were even greaterthan those for absolute rates. The following are key trends in relative rates over the period:The relative participation rate of very recent immigrants increased by 11.7 percentage
points from 95.1 per cent of the Canadian-born rate in 2006 to 106.8 per cent in 2019,7
and the relative rate of recent immigrants increased by 11.0 percentage points from 104.1
per cent in 2006 to 115.1 per cent in 2019.


The relative employment rate of very recent immigrants increased by 13.7 percentage
points from 88.7 per cent of the Canadian-born rate in 2006 to 102.4 per cent in 2019,
and the relative rate of recent immigrants increased by 12.8 percentage points from 101.1
per cent to 113.9 per cent.

The relative unemployment rate of very recent immigrants decreased by 32.2 percentage
points from 204.9 per cent of the Canadian-born rate in 2006 to 172.7 per cent in 2019,
and the relative rate of recent immigrants decreased by 26.1 percentage points from 144.3
per cent to 118.2 per cent.

The outcomes of relative wages for new immigrants were mixed. While very recent
immigrants saw an increase in relative wages over the period, the relative wages of recent
immigrants (those who have settled in Canada for 5 to 10 years) declined. This decline waslargely driven by the deteriorating relative earnings of highly educated immigrants.


The relative wage of very recent immigrants increased by 1.9 percentage points from
81.0 per cent of the Canadian-born wage in 2006 to 82.9 per cent in 2019, while therelative wage of recent immigrants decreased by 3.1 percentage points from 91.7 per centof the Canadian-born wage to 88.6 per cent.

Explaining the Labour Market Performance of New Immigrants
The report posits six reasons for the general improvement in the labour market
performance of new immigrants. First, new immigrants became even better educated from 2006
to 2019; the share of very recent immigrant workers with a university degree increased by 7.5
percentage points, while the share of recent immigrant workers increased by 6.7 percentage
points. Second, the strong labour market of the late 2010s may have disproportionately
benefitted new immigrants. Third, federal and provincial programs aimed at immigrant workers,
such as the Provincial Nominee Program, likely contributed to their improved labour
performance. Fourth, support services for new immigrants could have better enhanced theirintegration into the Canadian labour market. Fifth, improved labour market information could
have better prepared prospective immigrants to enter the Canadian labour market. Finally, theforeign credential recognition process could have improved. Further research is needed to assess
the validity and relative importance of these hypotheses to explain the improved labour market
performance of new immigrants.

8
The report posits two reasons for the weaker improvement in relative wages forcompared to other labour market indicators. First, challenges faced by immigrants in Canada,
such as discrimination, language barriers, and weaker social networks, may negatively affectearnings more than employment. Second, a lack of improvement in job mismatching over thisperiod could explain why the relative wages of university-educated recent immigrants (those
who have settled in Canada for 5 to 10 years) did not improve, despite high employment rates.
More highly educated immigrants could be employed in low-wage jobs. Policymakers should
address the issue of relative earnings to further improve the integration of immigrants into thelabour market.

9

The Improved Labour Market Performance of
New Immigrants to Canada, 2006-20191
Introduction
Immigration continues to be a major focus of Canadian public policy, given the growing
importance of immigrants in the Canadian labour market. With an aging workforce and pending
labour shortages, Canada relies on immigration to replenish its supply of high-skilled workers.
The contributions of immigrants to the labour market, thus, have a significant impact on
Canada’s economy both currently and in the future. As a result, examining the labour market
performance of new immigrants to Canada is important to evaluate the success of immigrant
integration in the labour market and to ascertain if the new immigrant labour force is being used
to its full potential.
In this report, we provide a descriptive analysis of the labour market performance of new
immigrants in Canada from 2006 to 2019.2 This report uses estimates of labour market outcomesfrom the Canadian Labour Force Survey (LFS). As LFS provides annual estimates up to 2019, it
has the most recent data for labour market outcomes compared to other sources. Thus, using LFS
data allows for timely comparisons of labour market outcomes between new immigrants andCanadian-born workers between 2006 and 2019. This report analyzes four labour market
indicators by immigrant status and education level: participation rate, unemployment rate,
employment rate, and average hourly wages. As this report presents descriptive analysis,
characteristics other than educational attainment, such as age, gender, and country of origin,
were not controlled for. Our analysis emphasizes trends in labour market indicators between
2006 and 2019, rather than levels. However, this report recognizes that new immigrants have
performed poorly on certain labour market indicators, in particular the unemployment rate andwages, resulting in a loss of their potential contribution to the economy.
We find that new immigrants to Canada have made significant gains in labour market
outcomes compared to the Canadian-born across education levels between 2006 and 2019. A
high proportion of new immigrants participated in the labour force, and employment rates weregenerally higher than the rate of the Canadian-born. Moreover, these rates continued to grow
1

This report was written by CSLS economist Kimberly Wong under the supervision of Andrew Sharpe, CSLS
Executive Director. The author would like to thank Don Drummond for comments.
Email: kimberlywong056@gmail.com
2
Our analysis does not include established immigrants (those who have settled in Canada for more than ten years),
as this report aims to evaluate how immigrants upon recently settling in Canada have integrated in the labour
market. However, in addition to the estimates for the new immigrant groups and Canadian-born, the Data Appendix
also includes the labour market outcomes of established immigrants. The Data Appendix is posted on the CSLS
website at http://www.csls.ca/reports/csls2020-03-data.xlsx.

10over the period. Although new immigrants had higher unemployment rates compared to the
Canadian-born, LFS estimates indicate substantial improvement in the absolute and relative
unemployment rates of newcomers. In contrast, the wage gap remained large over the period,
although absolute wages improved for all new immigrants and relative wages increased for very
recent immigrants. The overall trends in labour market outcomes suggest that the labour market
performance of new immigrants became stronger over this 13-year period.
This report first reviews the literature on the economic integration of new immigrants to
Canada. The second section discusses the data used in this report. In turn, the third section offers
an overview of the labour force by immigrant status. The fourth section provides a descriptive
analysis of the labour market performance of new immigrants, including comparisons inoutcomes between immigrants and the Canadian-born. Next, section five compares LFS
estimates with Census/NHS data, highlighting the similarities in trends between the sources.
Section six discusses the potential reasons for the improved labour market performance of new
immigrants. Finally, section seven offers concluding remarks, including a summary of the labour
performance of new immigrants and a future research agenda.

I. Literature Review
The economic integration of new immigrants to Canada has been widely researched.
Studies have focused on examining the trends in immigrant labour market outcomes over time,
usually from the late 1970s to the early 2000s. Much of the literature has concluded that labour
outcomes for immigrants have significantly declined between the 1970s and early 2000s. Thesestudies have also explored the factors behind these trends, such as the impact of changing
immigration policies, composition of new immigrants, and economic conditions. However, moststudies in the literature are not based on data after 2011. To our knowledge, no study has usedthe 2016 Census to evaluate the labour performance of immigrants, and only one study by
Yssaad and Fields (2018) has used recent LFS data up to 2017.

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Table 1: Summary of Results from Studies in the Literature
Author(s)YearSourcePeriod ofStudy

Frenette and Morrisette

2005

Census1980-2000

2019

Survey ofLabour
IncomeDynamics

1999-2004,
2002-2007,
2005-2010

Dean

2018

Survey ofLabour
IncomeDynamics

2001-2011

Hou and Picot

2016

Longitudinal
Immigration
Database

1981-2010

Kustec2012

Census1980-2006

2013

Longitudinal
Survey of
Immigrants
to Canada

2000-2005

Banerjee, Verma, andZhang

Sharaff

Skuterud and Su

2012

Labour Force
Survey2006-2008

Picot and Sweetman

2012

Census

1976-2005

Yssaad and Fields

2018

Labour Force
Survey2006-2017

Findings
The wage gap between new immigrants and theCanadian-born had more than doubled.
Immigrant men were more likely to be fully job
mismatched than white Canadian-born men.
Full mismatching had more negative effects on
earnings for immigrant men than the Canadianborn.
New immigrants were more likely than the
Canadian-born to be job-education mismatched.
New immigrants who were mismatched also
faced more negative effects on wages than the
Canadian-born.
The earnings gap between new immigrants andthe comparison group (the Canadian-born plus
established immigrants) increased.
The wage gap between recent immigrant men
and the Canadian-born increased.
Two-thirds of recent immigrants were overeducated for their jobs, resulting in an
approximate 8 per cent wage loss.
Immigrants were underrepresented in high-wagejobs due to lower mobility into and higher
mobility out of these jobs.
Immigrants experienced more difficulty
attaining and retaining high-wage jobs, which
frequently resulted in transitions into low-wagejobs or self-employment.
The relative unemployment rate for very recent
immigrants increased, while relative
employment rate and earnings decreased.
Relative employment and unemployment rates
improved.
The share of university-educated total
immigrant workers increased.

Documentation of the Labour Market Performance of Immigrants
A study by Picot and Sweetman (2012) confirmed that the economic outcomes ofimmigrant workers, such as employment rates, unemployment rates, and earnings, relative tothose of the Canadian-born deteriorated between the 1970s and the early 2000s. Using Census
data for the 1976 to 2005 period, they found that very recent immigrants (those who haveimmigrated for less than 5 years) had consistently lower employment rates but higher
unemployment rates than those of the Canadian-born. The gap in these rates between very recent
immigrants and the Canadian-born generally widened over the period. Immigrants, however,
suffered the worst outcome in relative earnings, which continuously declined; for example, thestudy found that very recent immigrant men earned 10 per cent less than the Canadian-born inthe 1970s, but they earned 28 per cent less in the early 2000s.

12
Picot and Sweetman also identified several reasons for the deterioration in outcomes fromthe 1970s to the early 2000s. For example, the 1970s and 1980s saw a shift in entering
immigrants’ countries of origin. More immigrants were arriving from Asia, Africa, and the
Caribbean, rather than Western Europe. These immigrants likely experienced more difficulty
integrating in the Canadian labour market compared to previous European immigrants due toseveral factors, such as language barriers and racial discrimination. The authors also determinedthat the IT crash of the early 2000s had severe consequences on the labour market outcomes of
new immigrants. In the late 1990s, the demand for workers in the high-tech industry led to asurge in immigration, many of whom were in the computer science field. The IT crash, thus,
negatively impacted these immigrants arriving at the end of the studied period.
Most of the literature on the labour performance of new immigrants focuses on earnings,
as opposed to participation, employment, and unemployment rates. Research on earnings report
weak outcomes and trends for immigrants. Earnings of new immigrants were consistently lower
than those of the Canadian-born, and evidence suggests that the wage gap has widened from thelate 20th to early 21st century. New immigrants to Canada, thus, face a disadvantage in earnings
relative to Canadian-born workers with similar levels of human capital; this phenomenon is
known as the “entry effect”. Frenette and Morrissette (2005), for example, used census data to
analyze the entry effect of immigrant cohorts from 1980 to 2000. They found that the wage gap
had more than doubled during that period. According to their estimates, new immigrant men
earned 16.5 per cent less than their Canadian-born counterparts in 1980, and this gap grew to39.9 per cent by 2000. They observed similar patterns for female immigrants.
More current studies have presented similar findings on wages. Kustec (2012), using the
Census, examined the earning disparities between recent immigrants and Canadian-bornworkers. In 1980, recent immigrant men earned 85 per cent of the Canadian-born’s wages, but
this ratio decreased to 63 per cent by 2005. Hou and Picot (2016) also examined the long-term
trends in immigrant entry earnings using the Longitudinal Immigration Database and extended
the period of study from 1981 to 2010. They determined that the entry earnings for recent
immigrants did not change significantly throughout the period, but the gap in earnings between
new immigrants and the comparison group (the Canadian-born plus established immigrants)
increased continuously. For example, in 1981, immigrant men received 74 per cent of thecomparison group’s earnings; by 2010, they received only 53 per cent. Wage disparities between
recent immigrants and the Canadian-born have not only persisted, but have also increased overtime.
While Hou and Picot (2016) concluded that the earnings gap increased, they identified
some factors that had a positive effect on the earnings of immigrants during the period. After the
1990s, the share of highly-educated, economic immigrants increased, due to changes inimmigration policy, which aimed to attract these types of immigrants to Canada. In 2000,

13
government immigration programs, such as the Provincial Nominee Program, led to an increasein new immigrants who already had Canadian work experience before receiving permanent
immigrant status. The change in immigrant characteristics in response to policy changes during
this period had a positive effect on immigrants’ earnings. However, these positive effects wereoffset by negative pressures, such as less favourable economic conditions, which led to weakgrowth in immigrants’ entry earnings in the 1990s and early 2000s.
A Statistics Canada report by Yssaad and Fields (2018) provided the most recent
descriptive analysis on the labour outcomes of immigrants in Canada. Using the Labour Force
Survey, they analyzed the trends in immigrant labour performance in Canada, namely
employment and unemployment rates, between 2006 and 2017. This study’s findings were more
optimistic than those in previous studies about earlier periods. The authors found that theemployment rate of immigrants improved from 2006 to 2017. The gap in employment rate
between very recent immigrants and the Canadian-born narrowed from 17.9 percentage points in2006 to 14.2 percentage points in 2017; likewise, the gap for recent immigrants decreased,falling from 7.5 percentage points in 2006 to 6.8 percentage points in 2017. In contrast, theunemployment rate of new immigrants changed little over this period and remained higher thanthat of the Canadian-born. However, in 2017, the unemployment rate of recent immigrants was
the lowest since 2006 at 9.6 per cent. This study also examined immigrant labour outcomes
across education levels. The share of university-educated immigrants among total immigrant
workers increased over the period and exceeded that of the Canadian-born; in 2017, 49.6 per centof total immigrant workers were university-educated, compared to 30.1 per cent of the Canadianborn. The employment rate of university-educated immigrants increased to 82.1 per cent in 2017,the highest in the period. The study also briefly discussed immigrant wages. They found that thewage gap between total immigrants and the Canadian-born remained stagnant at around 87.0 per
cent from 2006 to 2017.
This report is similar to the study by Yssaad and Fields in providing a descriptive
analysis on immigrant labour market outcomes based on the LFS. However, there are four key
differences. First, our analysis focuses only on new immigrants, and does not include any
discussion on established immigrants. Second, this report uses the most current LFS data until
2019, examining two more years than the period studied by Yssaad and Fields. Third, we provide
a more detailed discussion on wages for recent and very recent immigrants across educational
levels. Finally, this report offers a more comprehensive analysis of the labour market
performance of new immigrants.

Determinants of the Weakening Labour Market Performance of Immigrants
A number of studies have tried to determine the factors contributing to the poor relative
earnings of new immigrants. Many studies have explored how job matching for immigrants
impact these unfavourable outcomes. Sharaff (2013) explored the effects of job-education

14
mismatching on immigrants’ earnings. Based on the Longitudinal Survey of Immigrants to
Canada from 2000 to 2005, he found that two-thirds of recent immigrants were over-educated fortheir jobs, resulting in an approximate 8 per cent wage penalty. Similarly, Dean (2018), using theSurvey of Labour and Income Dynamics between 2001 to 2011, determined that new immigrants
were more likely than the Canadian-born to be job mismatched. New immigrants who weremismatched also faced more significant wage penalties than the Canadian-born.
Banerjee, Verma, & Zhang (2019) examined the impact of various types of job
mismatching on immigrant earnings using the Survey of Labour Income Dynamics from 1999 to
2004, 2002 to 2007, and 2005 to 2010. They assessed vertical mismatching (workers who are
over-educated), horizontal mismatching (workers who are working in a field unrelated to theireducational field), and full mismatching (vertical and horizontal mismatching combined). The
authors concluded that immigrant men were more likely to be fully mismatched than white
Canadian-born men. In other words, high-skilled immigrants were more likely to accept jobs
unrelated to their field and requiring less education than they have completed. Most significantly,
full mismatching had negative effects on earnings, which were more consequential on
immigrants than the Canadian-born.
Other research has tried to determine how the lower level in job quality of immigrants
has contributed to the poor relative earnings of new immigrants. Using the Canadian Labour
Force Survey from 2006 to 2008, Skuterud and Su (2012) found that the lower-skilled jobs ofimmigrants affected the overall earnings gap between immigrants and the Canadian-born.
Immigrants were underrepresented in high-wage jobs due to lower mobility into and higher
mobility out of these jobs. They determined that immigrants experienced more difficulty
attaining and retaining high-wage jobs, which frequently led them to transition into low-wagejobs or self-employment. Thus, job matching and job quality studies suggest that the relatively
lower earnings of new immigrants to Canada could be driven by poor sorting in the labour
market.

II. Data
This report uses Labour Force Survey (LFS) data from Statistics Canada. The LFS is amonthly household survey that assesses the Canadian labour market by classifying workers as
employed, unemployed and not in the labour force (Statistics Canada, 2020). Statistics Canada
surveys approximately 56,000 households with respondents aged 15 and over. In January 2006,
Statistics Canada added questions to the LFS about the immigrant status of respondents. In
particular, it asked respondents their country of birth, landed immigrant status, and year andmonth of arrival. These additional questions allow for comparisons of labour market
performance between domestic-born and immigrant workers in Canada.

15

Our descriptive analysis is based on annual LFS estimates for the 2006-2019 period byimmigrant status and highest level of educational attainment, which are publically available atTable 14-10-0087-01. This table includes the following labour market variables: working-age
population, labour force, employed and unemployed totals, and participation, employment andunemployment rates. This report also uses LFS estimates for average hourly wages by immigrant
status and highest level of educational attainment.3 These estimates are not publically available
and were obtained from Statistics Canada via special request.
This report compares labour market outcomes by immigrant status and education level.
According to the LFS, immigrant status is divided into four categories: born in Canada,
established immigrants (more than ten years), recent immigrants (five to ten years), and very
recent immigrants (less than five years). However, this report only analyzes the results of very
recent immigrants, recent immigrants, and the Canadian-born.4 Our analysis does not include
established immigrants, as this report focuses on evaluating how new immigrants to Canada haveintegrated in the labour market. Educational attainment consists of five categories: no degree,
diploma or certificate; high school graduate; high school graduate, some post-secondary; postsecondary diploma or certificate; and university degree.5
Labour force estimates from the 2006 Census, 2011 National Household Survey (NHS),
and 2016 Census are also presented in this report. These estimates are also available by highest
level of educational attainment and immigrant status. However, given the differences inmethodology between the NHS and other censuses, these sources are not comparable.6
Furthermore, the LFS provides annual data up to 2019, which allows for analyses of the mostcurrent labour market outcomes. Thus, this report relies on LFS estimates for its analysis, anduses the NHS and census data only to compare estimates with the LFS.

III. An Overview of the Labour Force by Immigrant Status
Before analyzing the labour outcomes of recent immigrants compared to the Canadianborn, this report provides an overview of the labour force characteristics of immigrant groups. In
particular, this section summarizes key characteristics relevant to labour market outcomes, such

3

The employment income of self-employed individuals is not included.
This report uses the term “new immigrants” when referring to the very recent and recent immigrants collectively.
The use of this term ensures distinction from established immigrants, who are not discussed in this report.
5
The main educational attainment categories are different for Census/NHS data. Refer to the section “Comparison
with the National Household Survey and Census Estimates”.
6
The federal government’s decision to replace the mandatory long-form census with the voluntary NHS for 2011
interrupted the time series measuring the labour market performance of immigrants from the census.
4

16
as education level, working-age population, and labour force. It highlights characteristics for
2019, as well as trends between 2006 and 2019.
Table 2 summarizes the labour market indicators analyzed in this report by highest levelof educational attainment and immigrant status for 2019. Labour market indicators in Canada
exhibit gradients for education level and immigrant status. Labour market outcomes in 2019were more favourable for individuals with higher levels of education. The relationship between
immigrant status and labour market performance depended on the indicator. Participation andemployment rates were higher for newer immigrants. However, new immigrants were worse offcompared to the Canadian-born for unemployment rates and average hourly wages:
unemployment rates were higher, and wages were lower. Despite these weaknesses, as this reportshows, new immigrants have made significant absolute and relative gains in labour market
outcomes over time.
Table 2: Labour Market Estimates for Canada by Immigrant Status and Highest Level of
Educational Attainment, 2019
Indicator

Immigration Status

Total, All
Education
LevelsNo Degree,
Certificate,or Diploma

High
SchoolGraduate

High School
Graduate,
Some Postsecondary

PostSecondary
Certificate or
Diploma

University
DegreePanel A: Thousands

Working-Age
Population

Labour ForceVery Recent Immigrants

1,075

146

135

45.1

207

542

Compound Annual Growth
2006-19 (%)

2.42

0.70

0.52

0.59

2.24

3.85

Recent Immigrants

1,190

140

172

72

271

535

Compound Annual Growth
2006-19 (%)

3.07

0.12

1.18

2.11

3.78

4.67

Born in Canada

21,866

3,686

4,448

1,281

7,595

4,855

Compound Annual Growth
2006-19 (%)

0.71

-2.39

0.87

-0.99

1.57

3.13

Total Population

30,739

4,884

5.968

1,726

9,863

8,300

Very Recent Immigrants

760

58.3

86.3

32.3

160

423

3.05

0.52

1.05

2.12

2.73

4.22

906

63.5

120

48.2

224

451

3.58

0.26

1.46

2.42

4.05

4.82

14,465

1,433

2,808

878

5,582

3,764

0.42

-3.33

-0.19

-1.54

1.11

2.64

20,200

1,838

3,661

1,140

7,164

6,397

688

47.8

78.8

29.9

148

384

3.31

0.64

1.41

2.53

2.96

4.45

847

55.8

108

43.3

214

427

3.77

0.89

1.50

2.55

4.21

4.91

Compound Annual Growth
2006-19 (%)
Recent Immigrants
Compound Annual Growth
2006-19 (%)
Born in Canada
Compound Annual Growth
2006-19 (%)
Total Population
Very Recent Immigrants

Employment

Compound Annual Growth
2006-19 (%)
Recent Immigrants
Compound Annual Growth
2006-19 (%)

17

Indicator

Unemployment

Total, All
Education
LevelsNo Degree,
Certificate,or Diploma

High
SchoolGraduate

High School
Graduate,
Some Postsecondary

PostSecondary
Certificate or
Diploma

University
DegreeBorn in Canada
Compound Annual Growth
2006-19 (%)
Total Population

13,676

1,266

2,615

819

5,325

3,651

0.48

-3.25

-0.27

-1.56

1.14

2.64

19,056

1,629

3,407

1,057

6,830

6,134

Very Recent Immigrants

71.9

10.5

7.50

2.40

12.4

39.0

0.89

0.00

-1.88

-1.70

0.45

2.22

58.6

7.7

11.8

4.80

9.90

24.3

1.17

-3.17

1.13

1.22

1.27

3.27

790

167

193

59.8

257

113

-0.47

-3.89

0.95

-1.18

0.54

2.66

1144

209

254

83.0

334

264

Immigration Status

Compound Annual Growth
2006-19 (%)
Recent Immigrants
Compound Annual Growth
2006-19 (%)
Born in Canada
Compound Annual Growth
2006-19 (%)
Total Population

Panel B: Per Cent

Participation Rate

Employment Rate

Unemployment
Rate

Very Recent Immigrants
Percentage Point Change
2006-2019
Recent Immigrants
Percentage Point Change
2006-2019
Born in Canada

70.7

40.0

63.9

71.6

77.5

78.1

5.4

-0.9

4.3

12.7

4.6

3.5

76.2

45.3

69.6

66.9

82.7

84.3

4.7

0.8

2.4

2.6

2.9

1.5

66.2

38.9

63.1

68.6

73.5

77.5

Percentage Point Change
2006-2019

-2.5

-5.2

-9.4

-5.1

-4.5

-4.9

Total Population

65.7

37.6

61.3

66.0

72.6

77.1

Very Recent Immigrants
Percentage Point Change
2006-2019
Recent Immigrants
Percentage Point Change
2006-2019
Born in Canada
Percentage Point Change
2006-2019
Total Population

64.0

32.8

58.3

66.3

71.4

70.9

6.8

-0.2

6.3

14.6

6.2

5.2

71.2

39.8

62.8

60.1

79.0

79.7

6.0

3.8

2.6

3.3

4.2

2.3

62.5

34.3

58.8

63.9

70.1

75.2

-2.0

-4.2

-9.4

-5.0

-4.0

-4.7

62.0

33.4

57.1

61.2

69.3

73.9

Very Recent Immigrants
Percentage Point Change
2006-2019
Recent Immigrants
Percentage Point Change
2006-2019
Born in Canada
Percentage Point Change
2006-2019
Total Population

9.5

18.0

8.7

7.4

7.8

9.2

-3.0

-1.3

-4.0

-4.8

-2.6

-2.6

6.5

12.1

9.9

10.0

4.4

5.4

-2.3

-7

-0.4

-1.6

-1.9

-1.1

5.5

11.6

6.9

6.8

4.6

3.0

-0.6

-0.9

1.0

0.3

-0.4

0.0

5.7

11.4

6.9

7.3

4.7

4.1

Panel C: Current Dollars ($)

18

Indicator

Nominal Average
Hourly Wage

Immigration Status

Total, All
Education
LevelsNo Degree,
Certificate,or Diploma

High
SchoolGraduate

High School
Graduate,
Some Postsecondary

PostSecondary
Certificate or
Diploma

University
DegreeVery Recent Immigrants

23.39

16.44

18.73

17.41

20.93

26.73

2.96

3.06

3.16

1.94

2.63

2.71

25.01

17.35

20.56

18.55

22.55

29.14

2.51

2.86

2.99

2.84

2.38

1.92

28.22

19.07

22.84

21.48

28.16

37.19

2.78

2.65

2.27

2.30

2.50

2.30

27.83

19.06

22.47

21.14

27.45

34.93

Compound Annual Growth
2006-19 (%)
Recent Immigrants
Compound Annual Growth
2006-19 (%)
Born in Canada
Compound Annual Growth
2006-19 (%)
Total Population

Panel D: Constant 2012 Dollars ($)

Real Average
Hourly Wages

Very Recent Immigrants
Compound Annual Growth
2006-19 (%)
Recent Immigrants
Compound Annual Growth
2006-19 (%)
Born in Canada
Compound Annual Growth
2006-19 (%)
Total Population

20.93

14.71

16.76

15.58

18.73

23.92

1.23

1.33

1.43

0.23

0.91

0.98

22.38

15.53

18.40

16.60

20.18

26.08

0.78

1.13

1.26

1.11

0.66

0.20

25.25

17.06

20.44

19.22

25.20

33.28

1.05

0.92

0.55

0.58

0.78

0.58

24.90

17.06

20.11

18.92

24.56

31.26

Source: Statistics Canada, Labour Force Survey, 2019, Table 14-10-0087-01

A. Educational Attainment of Workers by Immigrant Status
In 2019, approximately 19 million Canadians of the total working-age population were
employed.7 Of those workers, 17.9 per cent had at most a high school diploma, while 35.8 percent had post-secondary certification and 32.2 per cent had a university degree as their highest
level of education. However, when analyzed by immigrant status, the share of workers byeducation level differed significantly from the proportions for the total population.

7

Refer to Table 2 in the Data Appendix for LFS data on total employment in Canada by immigrant status and highest level of
educational attainment from 2006 to 2019.

19
Chart 1: Share of Workers in Canada by Immigrant Status and Education Level, 2019
Panel A: No Degree, Certificate or Diploma
Per Cent

20
6.94

6.59

Very Recent Immigrants

Recent Immigrants

10

9.26

0
Born in Canada

Panel B: High School Graduate
19.1

Per Cent

20
11.4

12.7

Very Recent Immigrants

Recent Immigrants

100
Born in Canada

Panel C: High School Graduate, Some Post-Secondary

Per Cent

20

10
4.34

5.11

5.99

Very Recent Immigrants

Recent Immigrants

Born in Canada

0Panel D: Post-Secondary Certificate or Diploma
50

38.9

Per Cent

40
30

21.4

25.2

20
10
0
Very Recent Immigrants

Recent Immigrants

Born in Canada

Panel E: University Degree
60

55.8
50.3

Per Cent

50
40
26.7

30
20
10
0
Very Recent Immigrants

Recent Immigrants

Source: Statistics Canada, Labour Force Survey, 2019, Table 14-10-0087-01

Born in Canada

20

Chart 1 depicts the share of workers of each immigrant group for every highest level of
educational attainment in 2019. The share of Canadian-born workers exceeded those of new
immigrant for every education level, apart from university degree. For example, about 19.1 percent of Canadian-born workers had at most a high school diploma; in comparison, very recent
and recent immigrant workers had lower shares at 11.4 and 12.7 per cent, respectively. Similarly,
the share of recent immigrants was larger than that of very recent immigrants for four of fiveeducation categories, excluding the university level.
The university category was the outlier among the education levels. Most notably, theshare of very recent immigrants dominated those of the other groups; approximately 55.8 percent of very recent immigrant workers held a university degree. The share of recent immigrants
followed closely with 50.3 per cent. However, the share of Canadian-born workers was
significantly lower at only 26.7 per cent. Thus, the fraction of very recent immigrant workers
with a university degree was more than double that of Canadian-born workers.8 These statistics
reveal that new immigrant workers were significantly more likely to be highly educated than the
Canadian-born.

B. Trends in Population, Labour Force, and Employment by Immigrant Status
According to LFS estimates, new immigrants comprised 7.4 per cent of the working-age
population in Canada in 2019. During the 2006-2019 period, the working-age population ofrecent immigrants grew the fastest (Chart 2).9 Recent immigrants ranked first at 3.07 per cent per
year on average, while the working-age population of very recent immigrants followed at 2.42
per cent per year. In contrast, the working-age population of the Canadian-born grew the slowest
at 0.71 per cent per year.

8

Refugees are included in the immigrant groups, though they make up a relatively small share of total immigrants.
For example, of those who immigrated between 2011 and 2016, approximately 11.6 per cent were refugees, while
60 per cent were economic immigrants (Statistics Canada, 2016). However, refugees are more likely to have much
lower levels of education, especially compared to economic immigrants. Therefore, if refugees had not been
included, the share of workers in the immigrant groups with post-secondary education would have been even higher.
9Refer to Data Appendix Table 9 for LFS estimates of working-age population in Canada by immigrant status andhighest level of educational attainment from 2006 to 2019.

21
Chart 2: Working-Age Population, Labour Force, and Employment in Canada by ImmigrantStatus (Compound Annual Growth), 2006-2019
Panel A: Working-Age Population
3.5

3.07

Per Cent Per Year

3
2.42

2.5
2
1.5
1

0.71

0.5
0
Very Recent Immigrants

Recent Immigrants

Born in Canada

Panel B: Labour Force
4.0

3.58

Per Cent Per Year

3.5

3.05

3.0
2.5
2.0
1.5
1.0

0.42

0.5
0.0
Very Recent Immigrants

Recent Immigrants

Born in Canada

Panel C: Employment
3.77

4.0
Per Cent Per Year

3.5

3.31

3.0
2.5
2.0
1.5
1.0

0.48

0.5
0.0
Very Recent Immigrants

Recent Immigrants

Born in Canada

Source: Statistics Canada, Labour Force Survey, 2006-2019

In 2019, the Canadian labour force grew to approximately 20.2 million. Approximately
760,000 very recent immigrants and 906,000 recent immigrants were in the workforce,comprising 3.76 per cent and 4.48 per cent of the labour force, respectively. However,corresponding to the trends in working-age population, the number of people in the labour force
for both immigrant groups increased at a significantly higher rate than that of the Canadian-born
between 2006 and 2019. Chart 2 shows that the number of recent immigrants in the labour force

22
grew the fastest at 3.58 per cent per year on average, compared to the rate of the Canadian-born
at just 0.42 per cent per year.10
The trends in total employment growth also correspond to trends for working-age
population and labour force (Chart 2). Recent immigrants ranked first for annual average
employment growth at 3.77 per cent during the 13-year period, while employment of very recent
immigrants also grew substantially at 3.31 per cent per year. However, employment growth for
Canadian-born workers grew the slowest at only 0.48 per cent per year.
Overall, the immigrant groups experienced higher growth in working-age population,
labour force, and employment compared to Canadian-born workers. These trends reflect therespective age demographics of each group. Very recent and recent immigrant groups are
relatively younger than the Canadian-born, whose population has a larger share of older persons.
Furthermore, growth in the labour force and total employment was slower for the Canadian-born,as the number of retired baby boomers in the working-age population increased over the period
both in absolute terms and as a share of the population 15 years and over. Most significantly,
new immigrant workers were likely to be more educated than the Canadian-born in 2019. Thesestatistics signify the growing contributions of highly skilled immigrants to the Canadian labour
market.

IV. Immigrant Labour Market Outcomes in Canada
To evaluate the labour market performance of new immigrants, this section analyzes fourlabour market outcomes: participation, unemployment, and employment rates, as well as averagehourly wages. For each outcome, we first summarize the statistics for 2019 by immigrant status
and education level. Finally, we compare the long-term trends in labour market outcomes from2006 to 2019 between new immigrants and the Canadian-born.

A. Participation Rate by Immigrant Status and Education level
Chart 3 compares the participation rates among immigrant groups and the Canadian-bornby education level in 2019. When compared across education levels, the groups exhibited similar
patterns in participation rates. For both new immigrants and the Canadian-born, participation
rates are higher with higher levels of educational attainment. The participation rate for university
graduates in each group was the highest amongst all educational attainment categories. However,when compared across groups, the participation rates of recent and very recent immigrants

10

Refer to Data Appendix Table 4 for LFS estimates of the labour force in Canada by immigrant status and highest
level of educational attainment from 2006 to 2019.

23
exceeded those of the Canadian-born at every education level.11 For the Canadian-born, theaggregate participation rate was 66.2 per cent in 2019. For very recent and recent immigrants, theaggregate participation rates were 70.7 per cent and 76.2 per cent, respectively.
Chart 3: Participation Rate in Canada by Immigrant Status and Education Level, 2019
90
80
70
Per Cent

60
50
40
30
20
10
0
Very Recent Immigrants

Recent Immigrants

Born in Canada

Total, all education levels

No degree, certificate or diploma

High school graduate

High school graduate, some post-secondary

Post-secondary certificate or diploma

University degree

Source: Statistics Canada, Labour Force Survey, 2019, Table 14-10-0087-01

The participation rates of new immigrants for university graduates were notably high. In
2019, university-educated recent immigrants had the highest participation rate at 84.3 per cent,while very recent immigrants followed with 78.1 per cent. The Canadian-born ranked last at 77.5
per cent.
Chart 4 : Participation Rate in Canada by Immigrant Status and Education Level, 2006-2019

Per Cent

Panel A: Total, All Education Levels
78
76
74
72
70
68
66
64
62
60
58
2006

2007

2008

2009

2010

Very Recent Immigrants

11

2011

2012

2013

2014

Recent Immigrants

2015

2016

2017

2018

2019

Born in Canada

Refer to Data Appendix Table 5 for LFS estimates of the labour force participation rate by immigrant status andeducation level from 2006 to 2019.

24

Per Cent

Panel B: University Degree
86
84
82
80
78
76
74
72
70
68
66
2006

2007

2008

2009

2010

Very Recent Immigrants

2011

2012

2013

2014

Recent Immigrants

2015

2016

2017

2018

2019

Born in Canada

Source: Statistics Canada, Labour Force Survey, 2006-2019, Table 14-10-0087-01

Chart 4 shows the participation rates of all groups between 2006 and 2019 at theaggregate and university level. Participation rates for both education levels showed similar
trends. Recent immigrants had the highest participation rate over the period, averaging 72.7 percent at the aggregate level and 82.7 per cent for university graduates between 2006 and 2019. In
contrast, the participation rate of very recent immigrants was the lowest of all the groups formost of the period with average rates of 67.5 per cent at the aggregate level and 75.3 per cent at
the university level. However, the participation rate of very recent immigrants trended upwards
starting in 2014 and finally surpassed the rate of the Canadian-born at the aggregate anduniversity level in 2016 and 2018, respectively. While the participation rates of both immigrantgroups trended upwards, the aggregate participation rate of the Canadian-born trended
downwards over the period.

25
Chart 5: Change in Participation Rate in Canada by Immigrant Status and Education Level, 20062019
Panel A: Total, All Education Levels
6

5.40

4.70

Percentage Points

4
2
0
-2

-2.50

-4
Very Recent Immigrants

Recent Immigrants

Born in Canada

Panel B: University Degree

Percentage Points

4

3.50
1.50

2
0
-2
-4
-6
Very Recent Immigrants

Recent Immigrants-4.90
Born in Canada

Source: Statistics Canada, Labour Force Survey, 2006-2019

Chart 5 shows the change in participation rates of each group between 2006 and 2019.
When compared to new immigrants, the Canadian-born experienced the worst performance in its
aggregate participation rate. The participation rate of the Canadian-born fell by 2.5 percentage
points, while the participation rates of recent and very recent immigrants increased by 4.7
percentage points and 5.4 percentage points, respectively. These increases were driven in part by
a compositional effect: an increase in the proportion of immigrants with post-secondary
education, who had relatively high participation rates.
Chart 5 reveals similar trends for university graduates. Very recent immigrants had thehighest growth in the participation rate of the university-educated at 3.5 percentage points. The
participation rate of recent immigrants also increased, though the change was smaller at 1.5
percentage points. The participation rate of the Canadian-born for university graduates, however,experienced a substantial decline at 4.9 percentage points between 2006 and 2019. The othereducation levels exhibited similar trends: the Canadian-born experienced a decline inparticipation rates at every education level.12 The contrast between the positive growth for new
immigrants and negative growth for the Canadian-born could reflect differences in age structure
12

Refer to Data Appendix Table 5 for LFS estimates of the labour force participation rate by immigrant status andeducation level from 2006 to 2019.

26
between the groups. Aging populations result in decreasing participation rates, which explains
the decline in rates for the Canadian-born at all education levels.
Chart 6: Participation Rate Relative to the Participation Rate of the Canadian-Born in Canada by
Immigrant Status and Education Level, 2006-2019
Proportion of theParticipation Rate for CanadianBorn Workers (Per Cent)

Panel A: Total, All Education Levels
120
115
110
105
100
95
90
85
2006

2007

2008

2009

2010

Very Recent Immigrants

2011

2012

2013

2014

Recent Immigrants

2015

2016

2017

2018

2019

Born in Canada (=100)

Proportion of the Participation Rate
for Canadian-Born Workers (PerCent)

Panel B: University Degree
115
110
105
100
95
90
85
80
2006

2007

2008

2009

2010

Very Recent Immigrants

2011

2012

2013

Recent Immigrants

2014

2015

2016

2017

2018

Born in Canada (=100)

Source: Statistics Canada, Labour Force Survey, 2006-2019

Chart 6 shows the participation rates of new immigrants relative to the participation rateof the Canadian-born at the aggregate and university level from 2006 to 2019. The participation
rate of recent immigrants consistently surpassed that of the Canadian-born during the period. On
average, the relative participation rate of recent immigrants between 2006 and 2019 was 107.4
per cent of the Canadian-born rate. However, the participation rate of very recent immigrants
was slightly lower than the rate of the Canadian-born over the period; the relative participation
rate averaged 99.6 per cent of the Canadian-born rate from 2006 to 2019.
The aggregate participation rates of both immigrant groups trended steadily upwards
relative to the rate of the Canadian-born. The relative rate of recent immigrants increased by 11.0
percentage points from 104.1 per cent in 2006 to 115.1 per cent in 2019. Although theparticipation rate of very recent immigrants averaged lower than the rate of the Canadian-born

2019

27
throughout the period, very recent immigrants made significant gains towards convergence, andthe participation rate finally surpassed the rate of the Canadian-born in 2016. The relative
participation rate of very recent immigrants increased by 11.7 percentage points from 95.1 percent of the Canadian-born rate in 2006 to 106.8 per cent of the Canadian-born rate in 2019.
The trends in the participation rates of university-educated immigrants relative to the rateof their Canadian-born counterparts were similar to the trends in aggregate rates (Chart 6).
University-educated recent immigrants consistently had a higher participation rate than their
Canadian-born counterparts from 2006 to 2019. On average over the period, the relative
participation rate of recent immigrants was 103.3 per cent of the Canadian-born rate, or 3.3
percentage points higher. In comparison, the relative participation rate of very recent immigrants
averaged 92.7 per cent of the Canadian-born rate over the period, though it exceeded the rate ofthe domestic-born after 2018. The other education levels exhibited identical patterns in relative
participation rates over the period.
The high and rising participation rates of new immigrants underscore the importanteconomic impact of immigration for Canada. Recent newcomers to Canada, particularly thosewith higher educational attainment, participated in the labour market at higher rates than the
Canadian-born. New immigrants also had much stronger growth in participation rates over the
2006-2019 period. This trend is critical, as demographics and current retirement patterns of baby
boomers indicate a reduced workforce among the Canadian-born over the next decades.

B. Employment Rate by Immigrant Status and Education Level
Chart 7 compares the employment rates among very recent immigrants, recent
immigrants, and the Canadian-born by education level in 2019. Recent immigrants had thehighest employment rate at 71.2 per cent, while very recent immigrants followed with 64.0 per
cent. Canadian-born workers had the lowest employment rate at 62.5 per cent. As suggested in
the discussion on participation rates, differences in demographics could explain the contrast in
employment rates between immigrants and Canadian-born workers. In 2019, the population of
new immigrants included larger shares of younger individuals. In addition, the immigrant groups
had larger shares of workers with a university education than the Canadian-born. Highly
educated individuals would have more likely found employment, which would have raised theemployment rates of new immigrants. The high employment rates of new immigrants highlightthe positive implications of immigration to Canada. With more employed immigrants, theCanadian government receives more tax revenue. Higher employment rates for new immigrants,
thus, result in a rising fiscal benefit of immigration.

28
Chart 7: Employment Rate in Canada by Immigrant Status and Education Level, 2019
90
80
70
Per Cent

60
50
40
30
20
10
0
Very Recent Immigrants

Recent Immigrants

Born in Canada

Total, all education levels

No degree, certificate or diploma

High school graduate

High school graduate, some post-secondary

Post-secondary certificate or diploma

University degree

Source: Statistics Canada, Labour Force Survey, 2019, Table 14-10-0087-01

Employment rates tended to be higher the higher the education level. For recent
immigrants and the Canadian-born, university graduates had the highest employment rates of theeducation levels. In 2019, university-educated recent immigrants had the highest employment
rate at 79.7 per cent, signifying the substantial contribution of this group to the Canadian
economy. The Canadian-born trailed with 75.2 per cent. However, very recent immigrants with auniversity degree had the lowest employment rate at 70.9 per cent.
Chart 8: Employment Rate in Canada by Immigrant Status and Education Level, 2006-2019
Panel A: Total, All Education Levels
75

Per Cent

70
65
60
55
50
2006

2007

2008

2009

2010

Very Recent Immigrants

2011

2012

2013

2014

Recent Immigrants

2015

2016

2017

Born in Canada

2018

2019

29
Panel B: University Degree85

Per Cent

80
75
70
65
60
2006

2007

2008

2009

2010

Very Recent Immigrants

2011

2012

2013

2014

Recent Immigrants

2015

2016

2017

2018

2019

Born in Canada

Source: Statistics Canada, Labour Force Survey, 2006-2019, Table 14-10-0087-01

Chart 8 shows the employment rates of all groups between 2006 and 2019 at theaggregate and university level. At the aggregate level, recent immigrants had the highest
employment rate for most of the period, averaging 66.2 per cent from 2006 to 2019. The
Canadian-born had the second highest employment rate at 63.1 per cent on average. Very recent
immigrants ranked last with 59.2 per cent on average, though the employment rate exceeded therate of the Canadian-born after 2018. For university graduates, the Canadian-born had thehighest rate for most of the period, averaging 77.5 per cent between 2006 and 2019, while recent
immigrants followed with an average of 76.4 per cent. Very recent immigrants with a university
degree had the lowest employment rates throughout the period with an average of 66.6 per cent.
While the employment rate of the Canadian-born declined over the period at the aggregate anduniversity level, the rates of recent and very recent immigrants increased steadily.
The difference in employment rates between recent and very recent immigrants was large
at the aggregate and university level. As recent immigrants have settled longer in Canada, they
likely faced fewer barriers in seeking employment than very recent immigrants. Recent
immigrants also likely had more advantages that would help with finding employment, such as
more advanced language skills and established connections to the community. The advantages
related to length of time since immigration likely explain recent immigrants’ higher employment
rates compared to very recent immigrants.

30
Chart 9: Change in Employment Rate in Canada by Immigrant Status and Education Level, 20062019
Panel A: Total, All Education Levels

Percentage Points

8

6.80

6.00

6
4
2
0
-2

-2.00

-4
Very Recent Immigrants

Recent Immigrants

Born in Canada

Panel B: University Degree

Percentage Points

6

5.20

4

2.30

2
0
-2
-4
-6
Very Recent Immigrants

Recent Immigrants-4.70
Born in Canada

Source: Statistics Canada, Labour Force Survey, 2006-2019

Chart 9 shows the change in the employment rate of each group at the aggregate anduniversity level between 2006 and 2019. New immigrants made the strongest gains in
employment rates during this period. The employment rates of very recent and recent immigrants
increased substantially with a 6.8 and 6.0 percentage-point change, respectively. In contrast, theemployment rate of the Canadian-born fell by 2.0 percentage points over the period.
Chart 9 shows similar patterns in growth for the employment rates of university
graduates. While very recent immigrants tended to have the lowest employment rates, this groupexperienced the highest growth at the university level over this period. The employment rate ofvery recent immigrants grew by 5.2 percentage points for university graduates. Though positive,
the growth for recent immigrants with a university degree was much lower at 2.3 percentage
points. While new immigrants experienced positive change, the rates of the Canadian-born with
university degrees faced significant decline at 4.7 percentage points. These trends were present
across education levels below the university level.13 Similar to the trends in participation rates,
13

For example, between 2006 and 2019, the employment rate of very recent immigrants with high school diplomas
increased by 6.3 percentage points, recent immigrants increased by 2.6 percentage points, and the Canadian-born
declined by 9.4 percentage points. Refer to Data Appendix Table 6 for LFS estimates of the employment rate byimmigrant status and education level from 2006 to 2019.

31
the employment rates of new immigrants improved significantly more than the rate of theCanadian-born between 2006 and 2019.
Chart 10: Employment Rate Relative to the Employment Rate of the Canadian-Born in Canada by
Immigrant Status and Education Level, 2006-2019
Proportion of the Employment Rate
for Canadian-Born Workers (PerCent)

Panel A: Total, All Education Levels
120
115
110
105
100
95
90
85
80
2006

2007

2008

2009

2010

Very Recent Immigrants

2011

2012

2013

2014

Recent Immigrants

2015

2016

2017

2018

2019

Born in Canada (=100)

Proportion of the Employment Rate
for Canadian-Born Workers (PerCent)

Panel B: University Degree
110
105
100
95
90
85
80
75
2006

2007

2008

2009

2010

Very Recent Immigrants

2011

2012

2013

Recent Immigrants

2014

2015

2016

2017

2018

2019

Born in Canada (=100)

Source: Statistics Canada, Labour Force Survey, 2006-2019

Chart 10 shows the employment rates of the immigrant groups relative to theemployment rate of the Canadian-born by education level from 2006 to 2019. The aggregate
employment rate of recent immigrants surpassed the rate of the Canadian-born throughout theperiod (with exceptions in 2008 and 2009). On average over the period, the relative employment
rate of recent immigrants was 104.7 per cent of the Canadian-born rate, or 4.7 percentage points
higher. In contrast, the relative employment rate of very recent immigrants was on average 93.4
per cent of the Canadian-born rate over the period, or 6.6 percentage points lower; however, theemployment rate of very recent immigrants finally exceeded the rate of the Canadian-born in
2018.

32
The relative employment rates of both immigrant groups trended upwards throughout theperiod. The relative employment rate of recent immigrants increased by approximately 12.8
percentage points from 101.1 per cent of the Canadian-born rate in 2006 to 113.9 per cent of theCanadian-born rate in 2019. The relative rate of very recent immigrants increased by 13.7
percentage points from 88.7 per cent to 102.4 per cent.
The relative employment rate for university-educated immigrants exhibited similar
upward trends. Both immigrant groups experienced rising relative employment rates. The
relative employment rate of recent immigrants with a university degree was on average 98.7 percent of the Canadian-born rate between 2006 and 2019. The relative employment rate of very
recent immigrants averaged 86.0 per cent of the Canadian-born rate, or 14.0 percentage points
lower. Thus, very recent immigrants had the highest gap in employment rates on average during
this period. Nevertheless, the consistently increasing relative employment rates of very recent
immigrants with a university degree between 2006 and 2019 indicate an encouraging trend
towards convergence to the rate of the Canadian-born. At the end of the period, the relative
employment rate of very recent immigrants increased by 12.0 percentage points from 82.3 percent of the Canadian-born rate in 2014 to 94.3 per cent in 2019.

C. Unemployment Rate by Immigrant Status and Education Level
Chart 11 compares the unemployment rates among immigrant groups and the Canadianborn by education level in 2019. The Canadian-born had the lowest unemployment rate at every
education level. The aggregate unemployment rate of the Canadian-born was 5.5 per cent in
2019, compared to 9.5 per cent and 6.5 per cent for very recent and recent immigrants,
respectively. As discussed previously, the participation rates of new immigrants exceeded therate of the Canadian-born; the gap in employment rates was smaller, but still positive. Thus,
these outcomes for new immigrants were better than or comparable to those of the Canadianborn. In contrast, the gap in unemployment rates was significantly high, indicating that new
immigrants were worse off than the Canadian-born for this indicator.

33
Chart 11: Unemployment Rate in Canada by Immigrant Status and Education Level, 201920

Per Cent

15
10
50
Very Recent Immigrants

Recent Immigrants

Total, all education levels
High school graduate
Post-secondary certificate or diploma

Born in Canada

No degree, certificate or diploma
High school graduate, some post-secondary
University degree

Source: Statistics Canada, Labour Force Survey, 2019, Table 14-10-0087-01

For recent immigrants and the Canadian-born, workers at lower levels of education faced
higher rates of unemployment. The least educated (those without any degree, certificate, or
diploma) had the highest unemployment rate, while the university-educated had one of thelowest unemployment rates. However, in contrast to this pattern, very recent immigrants faced arelatively high unemployment rate for university graduates, the second highest rate among the
education levels in this group. At 9.2 per cent, the unemployment rate of university-educatedvery recent immigrants was almost double that of recent immigrants at 5.4 per cent and threetimes higher than that of the Canadian-born at 3.0 per cent.
Chart 12: Unemployment Rate in Canada by Immigrant Status and Education Level, 2006-2019

Per Cent

Panel A: Total, All Education Levels
18
16
14
12
10
8
6
4
2
0
2006

2007

2008

2009

2010

Very Recent Immigrants

2011

2012

2013

2014

Recent Immigrants

2015

2016

2017

Born in Canada

2018

2019

34

Per Cent

Panel B: University Degree
16
14
12
10
8
6
4
2
0
2006

2007

2008

2009

2010

Very Recent Immigrants

2011

2012

2013

2014

Recent Immigrants

2015

2016

2017

2018

2019

Born in Canada

Source: Statistics Canada, Labour Force Survey, 2006-2019, Table 14-10-0087-01

Chart 12 shows the unemployment rates of all groups at the aggregate and university
level between 2006 and 2019. Very recent immigrants had the highest unemployment rates withan average of 12.3 per cent at the aggregate level and 11.6 per cent at the university level overthe period. Recent immigrants followed with an average of 9.0 per cent at the aggregate level and7.6 per cent at the university level. The Canadian-born consistently had the lowest
unemployment rates at the aggregate and university levels, averaging 6.6 and 3.3 per cent,respectively.
Chart 13: Change in Unemployment Rate in Canada by Immigrant Status and Education Level,
2006-2019
Panel A: Total, All Education Levels

Percentage Points

0
-0.60

-1
-2
-3

-2.30
-3.00

-4
Very Recent Immigrants

Recent Immigrants

Born in Canada

35
Panel B: University Degree
0.00

Percentage Points

0
-1
-1.10
-2
-3

-2.60
Very Recent Immigrants

Recent Immigrants

Born in Canada

Source: Statistics Canada, Labour Force Survey, 2006-2019

Chart 13 shows the change in unemployment rates of all groups by education level from2006 to 2019. Compared to the Canadian-born, new immigrants saw a more substantial decline
in aggregate unemployment rates over the period. The unemployment rate of very recent
immigrants decreased the most by 3.0 percentage points, while the rate of recent immigrants
declined by 2.3 percentage points. The unemployment rate of the Canadian-born fell by 0.6
percentage point.
Chart 13 shows similar trends for university graduates. From 2006 to 2019, recent andvery recent immigrants with a university degree saw an improvement in unemployment rates,
experiencing a 1.1 and 2.6 percentage-point decrease, respectively. In contrast, the Canadianborn with a university degree saw no change in unemployment rate between 2006 and 2019.
Although both immigrant groups had higher rates than the Canadian-born, the unemployment
rates of new immigrants experienced more significant improvement than the rate of theCanadian-born over time. The other education levels exhibited similar results.14

14

Refer to Appendix Table A.3 for LFS estimates of the unemployment rate by education level and immigrant status
between 2006 to 2019.

36
Chart 14: Unemployment Rate Relative to the Unemployment Rate of the Canadian-Born in
Canada by Immigrant Status and Education Level, 2006-2019
Proportion of the Unemployment
Rate for Canadian-Born Workers(Per Cent)

Panel A: Total, All Education Levels
220
200
180
160
140
120
100
80
2006

2007

2008

2009

2010

2011

Very Recent Immigrants

2012

2013

2014

Recent Immigrants

2015

2016

2017

2018

2019

Born in Canada (=100)

Proportion of the Unemployment Rate
for Canadian-Born Workers (Per Cent)

Panel B: University Degree
450
400
350
300
250
200
150
100
50
0
2006

2007

2008

2009

2010

2011

Very Recent Immigrants

2012

2013

Recent Immigrants

2014

2015

2016

2017

2018

2019

Born in Canada (=100)

Source: Statistics Canada, Labour Force Survey, 2006-2019

Chart 14 shows the unemployment rates of recent and very recent immigrants relative torate of the Canadian-born at the aggregate and university level from 2006 to 2019. For the entire
period, the aggregate unemployment rate of recent and very recent immigrants remained above
the rate of Canadian-born workers. From 2006 to 2012, the unemployment rate of very recent
immigrants almost doubled that of the domestic-born; the relative rate of very recent immigrants
averaged 199.4 per cent of the Canadian-born rate. The unemployment rate of recent immigrants
averaged 145.7 per cent of the Canadian-born rate between 2006 and 2012. The higher
employment growth for new immigrants was not sufficient to absorb all newcomers to Canada in
the labour force during this period, resulting in high relative unemployment rates. However, thesituation for new immigrants appears to have generally improved compared to Canadian-bornworkers from 2014 to 2019, as their relative unemployment rates decreased. From 2006 to 2019,the relative unemployment rate of recent immigrants decreased by 26.1 percentage points from
144.3 per cent of the Canadian-born rate to 118.2 per cent. The relative rate of very recent

37
immigrants decreased by 32.2 percentage points from 204.9 per cent of the Canadian-born rate in2006 to 172.7 per cent in 2019.
Despite the improvement in unemployment rates, the wide gap in rates reveals that
newcomers to Canada faced more difficulty finding employment than the Canadian-born
between 2006 and 2019. Moreover, as the Canadian-born and recent immigrants had lower
unemployment rates than very recent immigrants, there exists a correlation between immigrantlabour market conditions and the length of settlement time in Canada: labour market conditions
improve for immigrants the longer they have settled in Canada.

Proportion of the Unemployment Rate
for Canadian-Born Workers (PerCent)

Chart 15: Average Unemployment Rate of New Immigrants Relative to the Unemployment Rate of
the Canadian-Born in Canada by Education Level, 2006-2019
400
350
300
250
200
150
100
50
0

349

177
145

125

Total, all educationlevels

172
139

152

No degree,certificate or
diplomaHigh school
graduate

Very Recent Immigrants

227

200
142

Post-secondary
certificate or
diploma

University degree

Recent Immigrants

Source: Statistics Canada, Labour Force Survey, 2006-2019

Among the education levels, the gap in unemployment rates was largest for universityeducated immigrant workers (Chart 15). Very recent immigrants with a university degree had, on
average, the largest gap in unemployment rates relative to Canadian-born workers between 2006
and 2019. During this period, the unemployment rate of very recent immigrants with a university
degree averaged 349 per cent of the rate of their Canadian-born counterparts. The unemployment
rate of university-educated recent immigrants averaged 227 per cent of the Canadian-born rate.
Although Chart 14 shows that the gap in unemployment rates between new immigrants and theCanadian-born at the university level did decrease after 2013, new immigrants continued to facesignificantly higher unemployment rates than the Canadian-born at the end of the period. The
high unemployment rates of university-educated newcomers between 2006 and 2019 reveal thatthe economic potential of highly skilled immigrants has not been fully realized.

38

D. Average Hourly Earnings of Employees in Canada by Immigrant Status
Chart 16 shows the nominal average hourly wages of very recent immigrants, recent
immigrants, and the Canadian-born by education level in 2019. Canadian-born workers earned
the highest aggregate wages at $28.22 current dollars, while recent immigrants received $25.01
current dollars and very recent immigrants received $23.39 current dollars. At every educationlevel, the Canadian-born earned higher wages than new immigrants, and recent immigrants
earned more than very recent immigrants.

Current Dollars ($)

Chart 16: Nominal Average Hourly Wages in Canada by Immigrant Status and Education Level,
2019
40
35
30
25
20
15
10
5
0
Very Recent Immigrants

Recent Immigrants

Born in Canada

Total, all education levels

No degree, certificate or diploma

High school graduate

High school graduate, some post-secondary

Post-secondary certificate or diploma

University degree

Source: Statistics Canada, Labour Force Survey, 2019, Table 18-10-0005-01

For new immigrants and the Canadian-born, wages tended to increase with higher levelsof educational attainment (with the exception of high school graduates with some postsecondary). University-educated workers received the highest wages of the education levels. The
Canadian-born with a university degree earned $37.19 current dollars, recent immigrants earned$29.14 current dollars, and very recent immigrants earned $26.73 current dollars.

39
Chart 17: Real Average Hourly Wages in Canada by Immigrant Status and Education Level, 20062019
Panel A: Total, All Education Levels

Constant 2012 Dollars

27
25
23
21
19
17
15
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Very Recent Immigrants

Recent Immigrants

Born in Canada

Panel B: University Degree

Constant 2012 Dollars

35
30
25
20
15
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Very Recent Immigrants

Recent Immigrants

Born n Canada

Source: Statistics Canada, Labour Force Survey, 2006-2019

Chart 17 shows the real average hourly wages of all groups at the aggregate anduniversity level from 2006 to 2019. For both education levels, Canadian-born workers
consistently had the highest wages over the period, and very recent immigrants received thelowest wages. For the Canadian-born, aggregate real wages grew by $3.20 constant 2012 dollars
from $22.05 in 2016 to $25.25 in 2019. Comparatively, the real wages of recent immigrants
increased by $2.16 constant 2012 dollars from $20.22 in 2006 to $22.38 in 2019, and the real
wages of very recent immigrants increased by $3.07 constant 2012 dollars from $17.86 in 2006
to $20.93 in 2019.
Real wages for university-educated workers also increased for all groups over the period.
The real wages of Canadian-born workers with a university degree grew by $2.40 constant 2012
dollars from $30.88 in 2006 to $33.28 in 2019. The real wages of university-educated recent

40
immigrants grew by $0.68 constant 2012 dollars from $25.40 in 2006 to $26.08 in 2019. For
university-educated very recent immigrants, real wages increased by $2.86 constant 2012 dollars
from $17.86 in 2006 to $20.93 in 2019.
Chart 18: Real Average Hourly Wages in Canada by Immigrant Status and Education Level(Compound Annual Growth), 2006-2019

Per Cent Per Year

Panel A: Total, All Education Levels
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0.0

1.23
1.05
0.78

Very Recent Immigrants

Recent Immigrants

Born in Canada

Panel B: University Degree
Per Cent Per Year

1.2

0.98

1.0
0.8

0.58

0.6
0.4

0.20

0.2
0.0
Very Recent Immigrants

Recent Immigrants

Born in Canada

Source: Statistics Canada, Labour Force Survey, 2006-2019

Chart 18 shows the compound annual growth in real wages of each group from 2006 to
2019. At the aggregate level, all groups enjoyed positive real wage growth over this period. Veryrecent immigrants ranked first in growth at 1.23 per cent per year, while the Canadian-born andrecent immigrants followed with 1.05 per cent and 0.78 per cent per year, respectively. In
contrast to the relatively weaker growth in participation, unemployment, and employment rates,
the Canadian-born wage experienced comparable growth to the new immigrants’ wages.
Higher education levels exhibited a similar growth pattern in real wages between 2006
and 2019. At the university level, very recent immigrants saw the highest growth in real wages at
0.98 per cent per year, followed by the Canadian-born at 0.58 per cent per year; the real wages ofrecent immigrants had the lowest growth at 0.20 per cent per year.15 Real wage growth foruniversity-educated workers was lower than the growth in aggregate wages.

15

Lower education levels did not follow this pattern. For lower education levels, the compound annual growth inwages of the Canadian-born was lower than those of both immigrant groups. Refer to Data Appendix Table 8 for
LFS estimates of the nominal and real average hourly wage of workers (excluding self-employed) in Canada byimmigrant status and highest level of educational attainment from 2006 to 2019.

41
Chart 19: Average Hourly Wage Relative to the Canadian-Born Wage in Canada by ImmigrantStatus and Education Level, 2006 and 2019

Proportion of teh Wage ofCanadian-Born Workers (PerCent)

Panel A: Very Recent Immigrants
90
85
80
75
70
65
No degree, certificate High school graduate
High school
Post-secondary
University degree
or diploma
graduate, some post- certificate or diploma
secondary
2006

2019

Proportion of teh Wage ofCanadian-Born Workers (PerCent)

Panel A: Recent Immigrants
95
90
85
80
75
70
No degree,certificate or
diplomaHigh school
graduate

High school
graduate, somepost-secondary
2006

Post-secondary
certificate or
diploma

University degree2019Source: Statistics Canada, Labour Force Survey, 2006-2019

Chart 19 compares the relative wages of each education level by immigrant group in2006 and 2019. For very recent immigrants, relative wages in 2006 and 2019 were lower withhigher levels of education (with the exception of high school graduates with some postsecondary in 2006, which had the highest relative wages). In 2006 and 2019, university-educatedvery recent immigrants had the lowest relative wages among the education levels at 68.2 per centand 71.9 per cent, respectively. Relative wages in 2019 (apart from high school graduates withsome post-secondary) were higher than those in 2006.
For recent immigrants, relative wages in 2019 decrease with higher levels of education.
On the other hand, relative wages in 2006 decrease across the lower education levels, but
increase across the post-secondary levels. Most significantly, relative wages in 2019 for recent
immigrants exceeded those in 2006 only for the low education levels. For post-secondary
graduates, relative wages in 2019 were lower than the relative wages in 2006. This observation
supports the finding that relative wages of highly educated recent immigrants showed the least
improvement from 2006 to 2019.

42

The relationship between education and wages contrasts the relationship for other labour
market outcomes. Relative participation and employment rates increase with higher levels of
educational attainment. Conversely, immigrant wages relative to the Canadian-born tended todecrease the higher the education level. While immigrants with post-secondary education madestrong gains in most labour market outcomes, immigrant wages for the highly-educatedexperienced less relative improvement, as large disparities persisted throughout the period.
Chart 20: Average Hourly Wage Relative to the Canadian-Born Wage in Canada by ImmigrantStatus and Education Level, 2006-2019
Proportion of the Wage for
Canadian-Born Workers (Per Cent)

Panel A: Total, All Education Levels
105
100
95
90
85
80
75
70
2006

2007

2008

2009

2010

2011

Very Recent Immigrants

2012

2013

2014

Recent Immigrants

2015

2016

2017

2018

2019

Born in Canada (=100)

Proportion of the Wage for
Canadian-Born Workers (Per Cent)

Panel B: University Degree
105
100
95
90
85
80
75
70
65
60
55
2006

2007

2008

2009

2010

2011

Very Recent Immigrants

2012

2013

Recent Immigrants

2014

2015

2016

2017

2018

2019

Born in Canada (=100)

Source: Statistics Canada, Labour Force Survey, 2006-2019

Chart 20 shows the nominal average hourly wage of recent and very recent immigrants as
proportions of the Canadian-born wage from 2006 to 2019. Over this period, new immigrants
had lower aggregate wages than the Canadian-born, and these relative wages for immigrants did
not increase substantially. The relative wage of very recent immigrants increased by 1.9
percentage points from 81.0 per cent in 2006 to 82.9 per cent in 2019, while the relative wage ofrecent immigrants decreased by 3.1 percentage points from 91.7 per cent to 88.6 per cent. Very

43
recent immigrants consistently had the lowest relative wages for all education levels, earning on
average 80 cents per dollar earned by the Canadian-born between 2006 and 2019. Recent
immigrants received more on average at 89 cents per dollar earned by the Canadian-born overthe period.
After 2016, Chart 20 depicts the beginning of an upward-sloping trend in immigrant
wages relative to the Canadian-born wage. For example, the relative wages of very recent
immigrants increased by 4.5 percentage points from 78.4 per cent of the Canadian-born wage in2016 to 82.9 per cent in 2019; the relative wages of recent immigrants grew by 3.7 percentage
points from 85.0 per cent of the Canadian-born wage in 2016 to 88.6 per cent in 2019.
Nonetheless, the persistent wage gap between new immigrants and the Canadian-born from 2006
to 2019 supports the existence of an “entry effect” for newcomers to Canada. Furthermore, as
recent immigrants tended to earn more than very recent immigrants across education levels, the“entry effect” diminishes as immigrants remain longer in Canada.
Chart 20 also shows that the wage gap for university-educated immigrants was more
severe than the gap at the aggregate level. University-educated recent immigrants earned on
average 78.6 per cent of the Canadian-born wage during this period, while very recent
immigrants earned less at 68.2 per cent on average. Of all education levels and immigrantgroups, very recent immigrants with a university degree had the largest average earnings gap
between 2006 and 2019.
Chart 20 shows that relative wages for university-educated recent immigrants declined
over the period, though they increased for very recent immigrants. After bottoming out in 2010
at 64.8 per cent of the Canadian-born wage, the relative wages of very recent immigrants
increased to 71.9 per cent in 2019—3.7 percentage points higher than the relative wage level in2006 of 68.2 per cent. In comparison, the relative wages of recent immigrants began increasing
only after 2016; relative wages increased from 75.6 per cent of the Canadian-born wage in 2016
to 78.4 per cent in 2019, remaining well below the relative wage level in 2006. For the overall
period, the relative wage of university-educated recent immigrants fell by 3.9 percentage points
from 82.3 per cent of the Canadian-born wage in 2006 to 78.4 per cent in 2019. Thus, the wage
gap between recent immigrants and the Canadian-born widened between 2006 and 2019.
The sustained wage gap for university-educated immigrants over the 13-year period
suggests that the high credentials of immigrants were not rewarded as highly as those of
Canadian-born workers with comparable qualifications. The share of university-educatedworkers in the workforce for both immigrant groups grew from 2006 to 2019, which the44relatively high employment rates of new immigrants reflected.16 In contrast, the relative wages ofimmigrants failed to reflect immigrant workers’ higher educational attainment.

V. Comparison with National Household Survey and Census Estimates
This section compares estimates of immigrant labour market outcomes between the
Labour Force Survey and data from the 2006 Census, 2011 National Household Survey (NHS),
and 2016 Census. The LFS, NHS, and Census estimates are not perfectly comparable due tomethodological differences among the surveys.17 Nevertheless, comparing LFS estimates with
NHS and census data will determine whether other data sources confirm this report’s LFS
findings.18
Table 3: Comparing LFS and NHS/Census Estimates for Canada by Immigrant Status, May 2006,
May 2011, and May 2016
2006
Indicator

Immigrant Status

LFS

2011

Census

LFS

2016
NHS

LFS

2006-2016

CensusPer Cent

Participation Rate

Employment Rate

Unemployment
Rate

16

LFS

CensusPercentage Point
ChangeVery Recent Immigrants

64.6

67.2

65.3

66.4

66.6

67.2

2.0

0.0

Recent Immigrants

72.3

71.2

72.0

71.4

73.2

72.0

0.9

0.8

Born in Canada

68.3

68.3

68.2

67.3

66.5

66.4

-1.8

-1.9

Total Population

66.7

66.8

66.6

66.0

65.6

65.2

-1.1

-1.6

Very Recent Immigrants

57.3

58.9

56.6

57.6

58.8

59.2

1.5

0.3

Recent Immigrants

66.4

65.2

64.9

64.4

66.0

65.4

-0.4

0.2

Born in Canada

64.0

63.9

62.9

62.2

61.7

61.3

-2.3

-2.6

Total Population

62.4

62.4

61.3

60.9

60.8

60.2

-1.6

-2.2

Very Recent Immigrants

11.4

12.3

13.4

13.3

11.6

11.9

0.2

-0.4

Recent Immigrants

8.2

8.4

9.8

9.8

9.8

9.1

1.6

0.7

Born in Canada

6.4

6.4

7.8

7.6

7.1

7.7

0.7

1.3

Total Population

6.5

6.6

7.9

7.8

7.4

7.7

0.9

1.1

For very recent immigrants, the number of university-educated individuals in the labour force grew at a compound
annual rate of 4.22 per cent from 2006 to 2019. For recent immigrants, the total grew to 4.82 per cent. These rates
were higher than the Canadian-born rate of 2.64 per cent. Moreover, the growth rate for the university-educated was
the highest rate among the education levels for both immigrant groups. Refer to Data Appendix Table 4.
17
Significant methodological differences exist between the Census and NHS. Minor differences also exist between
the 2006 and 2016 Census, such as different target populations. Thus, NHS data are not comparable with Census
data. Nonetheless, to compare with LFS estimates, Table 3 presents labour force estimates from the 2006 Census,
2011 NHS, and 2016 Census, as well as the per cent or percentage point change in values between 2006 and 2016.
18
Note that the annual LFS estimates are averaged monthly, while the Census uses the census month for annual
estimates.

45
Source: Statistics Canada, Census, 2006; National Household Survey, 2011; Census 2016; Labour Force Survey, May 2006,
2011, and 2016

Table 3 provides the LFS, Census, and NHS estimates of participation, employment andunemployment rates in Canada by immigrant status for 2006, 2011, and 20016.19 The surveys
featured similar patterns in estimates. According to both the LFS and NHS/Census in all three
years, recent immigrants generally had the highest participation and employment rates, followedby the Canadian-born and very recent immigrants.20 Similarly, both the LFS and NHS/Census
indicate that very recent immigrants had the highest unemployment rate and recent immigrants
had the second highest in 2006, 2011, and 2016.
The absolute change in labour market outcomes of new immigrants between May 2006
and May 2016 differed between the LFS and Census.21 The changes based on LFS data are notfound to the same degree as in the Census. For very recent immigrants, the participation rateincreased by 2.0 percentage points according to the LFS, but remained constant from 2006 to2016 according to the Census. The employment rate increased by 1.5 percentage points based on
LFS estimates versus 0.3 percentage point based on the Census. Finally, the unemployment rateincreased by 0.2 percentage point according to the LFS, but decreased by 0.4 percentage pointaccording to the Census.
For recent immigrants, the Census determined greater absolute improvement than the
LFS for the employment and unemployment rate, while the LFS estimated stronger improvement
for the participation rate. The participation rate increased by 0.9 percentage point based on the
LFS and 0.8 percentage point based on the Census. The employment rate increased by 0.2
percentage point according to the Census, but decreased by 0.4 percentage point based on the
LFS. Finally, the unemployment rate increased by 0.7 percentage point according to the Census
and 1.6 percentage points according to the LFS.

19

For working age population, labour force, employed and unemployed totals, refer to Data Appendix Table 10 for2006 Census estimates, Table 11 for NHS estimates, and Table 12 for 2016 Census estimates. Significant level
differences exist for these outcomes between the LFS and the other sources of data. However, large discrepancies
mostly occur for very recent immigrants. The LFS estimates of working age population, labour force, employed andunemployed totals for very recent immigrants in May 2006 were significantly lower than the 2006 Census estimates.
The differences for May 2011 and 2016 were not as large, but the LFS estimates for very recent immigrants werestill lower than their corresponding NHS/Census data.
20
The LFS and Census estimates for participation rates in 2016 are the exception. Recent immigrants had thehighest participation rate, very recent immigrants had the second highest, and the Canadian-born had the lowest.
21
Refer to Data Appendix Table 13 for working age population, labour force, employed and unemployed totals. For
all groups, the magnitudes of the percentage increase in population, labour force, employed and unemployed totals
based on LFS estimates were generally higher than the magnitudes based on Census data.

46
Table 4: Average Employment Income in Canada by Immigrant Status and Highest Level of
Educational Attainment According to the 2006 Census, 2011 NHS, and 2016 Census
Panel A: 2006 Census
Total, All
Education
LevelsCertificate or
University
Diploma Below
Certificate or
Bachelor Level
DiplomaCurrent Dollars ($)

Bachelor's
DegreeVery Recent Immigrants

23,961

18,361

30,27027,364

Recent Immigrants

29,272

21,66841,26935,909Born in Canada

36,45730,72061,23755,384
Proportion of Income for Canadian-Born Workers (Per Cent)

Very Recent Immigrants

65.7

59.8

49.4

49.4

Recent Immigrants
80.3
70.5
67.4
64.8
Note: The 2006 Census only gives employment income estimates for post-secondary education levels. “Certificate or Diploma
Below Bachelor Level” refers to college or other non-university certifications. “University Certificate or Degree” refers to nondegree university certificates related to professional associations, such as accounting. “Very Recent Immigrants” only includes
immigrants who arrived between 2001-2004.

Panel B: 2011 NHS
Total, All
Education
LevelsNo
Certificate,
Diploma or
DegreeHigh School
Graduate

Postsecondary
Certificate,
Diploma or
DegreePostsecondary
Certificate or
Diplomabelow
Bachelor
Level

University
Certificate,
Diploma or
Degree at
Bachelor
Level orAbove

Current Dollars ($)
Very Recent Immigrants

31,25818,367

20,76435,582

28,426

39,839Recent Immigrants

36,54418,92021,78042,38732,26748,051

Born in Canada

41,97823,32831,12750,98042,297
Proportion of Income for Canadian-Born Workers (Per Cent)

66,517

Very Recent Immigrants

74.5

78.7

59.9

66.7

69.8

67.2

Recent Immigrants
87.1
81.1
70.0
83.1
76.3
72.2
Note: “Post-secondary Certificate or Diploma below Bachelor Level” refers to non-degree university certificates related toprofessional associations, such as accounting. “Very Recent Immigrants” only includes immigrants who arrived between 20062009.

Panel C: 2016 Census
Total, All
Education
LevelsNo
Certificate,
Diploma or
DegreeHigh School
Graduate

Postsecondary
Certificate,
Diploma or
DegreeUniversity
Certificate or
Diplomabelow
Bachelor
Level

University
Certificate,
Diploma or
Degree at
Bachelor
Level orAbove

Current Dollars ($)
Very Recent Immigrants

33,077

17,66222,75938,05730,58541,888

Recent Immigrants

36,77320,07023,862

43,23736,22948,546

Born in Canada

47,01825,07034,72857,11751,581
Proportion of Income for Canadian-Born Workers (Per Cent)73,614

Very Recent Immigrants

70.3

70.5

65.5

66.6

59.3

56.9

Recent Immigrants

78.2

80.1

68.7

75.7

70.2

65.9

47
Note: “University Certificate or Degree below Bachelor Level” refers to non-degree university certificates related toprofessional associations, such as accounting. “Very Recent Immigrants” only includes immigrants who have arrived between
2011-2014.
Source: Statistics Canada, Census, 2006; National Household Survey, 2011; Census 2016

Table 4 provides estimates of average employment income in 2006, 2011, and 2016 byimmigrant status and highest level of educational attainment from the Census and NHS. The
findings based on these estimates are consistent with the findings in LFS estimates of nominal
average hourly wages for each respective year.22 Similar to the LFS estimates, the Census showsthat very recent and recent immigrants earned significantly lower employment income than
Canadian-born workers at every education level and for every year.
Each survey reveals a similar gradient for income in terms of immigrant status andeducation level. As education increases, the earnings disparity between the Canadian-born andnew immigrants also increases. The highest education level consistently had the largest earnings
gap. Very recent immigrants with a university degree earned 49.4 per cent of Canadian-born
earnings according to the 2006 Census, 59.9 per cent according to the 2011 Census, and 56.9 percent according to the 2016 Census. In comparison, university-educated recent immigrants earned
64.8 per cent of Canadian-born earnings according to the 2006 Census, 72.2 per cent according
to the 2011 Census, and 65.9 per cent according to the 2016 Census. Very recent immigrants
earned less than recent immigrants at every education level in 2006, 2011, and 2016. The
earnings gaps between new immigrants and the Canadian-born, as well as the gap between very
recent and recent immigrants, signify an “entry effect” for newcomers to Canada. Theseobservations found in the NHS/Census employment income data are consistent with the ones
found in LFS data for hourly wages.

22

The Census and NHS only provide estimates for average employment income, not average hourly wages. Thus,
LFS and Census/NHS estimates for earnings are not directly comparable. However, the patterns in earnings acrossimmigrant status and educational levels between the sources of data are similar.

48
Table 5: Comparing LFS and Census Relative Earnings/Average Hourly Wages in Canada by
Immigrant Status and Highest Level of Educational Attainment, 2006 and 2016
Panel A: Total, All Education Levels
2006
Immigrant Status

Very Recent Immigrants
Recent Immigrants

LFS

2016
Census

LFS

2006-2016
Census

Proportion of Earnings for Canadian-Born Workers(Per Cent)
81.0
65.7
78.4
70.3
91.7

80.3

85.0

78.2

LFS

CensusPercentage Point Change
-2.6

4.6

-6.7

-2.1

Panel B: University Degree
2006
Immigrant Status

Very Recent Immigrants

LFS

2016
Census

LFS

2006-2016
Census

Proportion of Earnings for Canadian-Born Workers(Per Cent)
68.2
49.4
68.6
56.9

Recent Immigrants
82.3
64.8
75.6
65.9
Source: Statistics Canada, Labour Force Survey, 2006-2019; Census, 2006; Census 2016

LFS

CensusPercentage Point Change
0.4

7.5

-6.7

1.1

Table 5 compares the relative employment income estimated by the Census and therelative wages determined by the LFS for new immigrants at the aggregate and university levelin 2006 and 2016.23 Relative wages based on the LFS exceeded the relative income based on the
Census for both immigrant groups and education levels in 2006 and 2016. The change in relative
earnings was also significantly different between the two sources of data. The Census indicated aconsiderably greater improvement in earnings than the LFS between 2006 and 2016. The LFS,
which indicated a relatively weak performance in the relative wages of new immigrants from2006 to 2019, may be underestimating their true improvement. For very recent immigrants,
relative earnings increased by 4.6 percentage points according to the Census from 2006 to 2016,
but decreased by 2.6 percentage points according to the LFS. Similarly, relative earnings at theuniversity level improved more significantly based on Census data; the Census indicated an
improvement of 7.5 percentage points over the period, while the LFS estimated a more modest
increase of 0.4 percentage point.
The relative earnings of recent immigrants had similar results. At the aggregate level,
relative income decreased by 2.1 percentage points based on the Census from 2006 to 2016,
while relative wages decreased by 6.7 percentage points based on the LFS. At the university
level, relative income increased by 1.1 percentage points according to the Census, but relative
wages decreased by 6.7 percentage points according to the LFS. Thus, LFS estimates show aweaker change in earnings between 2006 and 2016 compared to the Census.
23

Note that, similar to Table 4, LFS and Census estimates for earnings are not perfectly comparable. Relative
earnings for the LFS are based on average hourly earnings, while those for the Census are based on employment
income.

49

VI. Explaining the Improved Labour Performance of New Immigrants
New immigrants achieved absolute and relative improvements in labour market outcomesfrom 2006 to 2019, most notably higher participation and employment rates and lower
unemployment rates. This section posits several reasons for the improvement in the performanceof new immigrants over this 13-year period. The following reasons, however, are speculative,
and further research is needed to assess the validity and relative importance of these hypotheses
to explain the improved labour market performance of new immigrants.

24



Rising Importance of University-Educated Immigrants among Total Immigrants in
Canada – New immigrants have a large share of individuals with high educational
attainment, as the Canadian immigration system has aimed to attract highly skilled andeducated immigrants since the 1990s (Reitz, 2013). Most significantly, the share of new
immigrant workers with a university education increased from 2006 to 2019. For very
recent immigrants, the share of university-educated workers increased by 7.5 percentage
points from 48.3 per cent in 2006 to 55.8 per cent in 2019. For recent immigrants, theshare of workers with a university degree increased by 6.7 percentage points from 43.7
per cent in 2006 to 50.3 per cent in 2019.24 Thus, as immigrants were more likely to be ofprime working age and highly educated than the Canadian-born population, and the shareof new immigrant workers with a university degree increased from 2006 to 2019, theparticipation and employment rates for new immigrants improved over the period.

Strong Labour Market of the late 2010s – Between 2006 and 2012, Canada’s
unemployment rate averaged 7.1 per cent, but between 2013 and 2019, theunemployment rate decreased to 6.5 per cent on average (Chart 21). New immigrants
could have benefited disproportionately from the strong post-recession labour market in
Canada. Macroeconomic conditions have a particularly significant impact on the labour
outcomes of new immigrants entering the Canadian labour market (Aydemir, 2003).
During periods of economic downturns, employers may less likely take the risk of hiring
newcomers to Canada; conversely, during times of strong economic conditions,employers may be more willing to employ new immigrants. The strong labour market
during the second half of the 2010s could have contributed to the high participation andemployment rates of these newcomers.

Refer to Table 2 in the Data Appendix for LFS data on total employment in Canada by immigrant status and highest level of
educational attainment from 2006 to 2019.

50

Per Cent

Chart 21: Unemployment Rate in Canada, 2006-2019
8.5
8.0
7.5
7.0
6.5
6.0
5.5
5.0
2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Source: Statistics Canada, Labour Force Survey, 2006-2019

Federal/Provincial Programs Aimed at Immigrant Workers – Between 2006 and 2019,
government programs, such as the Federal Skilled Worker Program and the Provincial
Nominee Program, could have contributed to the improved labour performance of new
immigrants. For example, the Provincial Nominee Program (PNP) targets skilled workers
for immigration who will help fulfill the province’s specific economic needs (Kustec,2012). Immigrants under the PNP would, thus, more likely obtain employment quickly
after arrival. By targeting highly skilled immigrant workers, these programs could havehelped strengthen the overall labour performance of new immigrants. However, further
research on these programs is needed to evaluate their impact.

Improved Support Services for New Immigrants – Services for immigrant candidates andnew immigrants could have improved between 2006 and 2019. Pre-arrival services may
have better prepared immigration applicants for integration into the Canadian labour
market, such as helping candidates connect with Canadian employers before immigration.
Finally, new immigrants over this period may have had more access to services in
Canada related to employment and skills development, such as career counselling andlanguage classes.



Better Labour Market Information – Between 2006 and 2019, immigrant candidates
likely had access to improved online sources of Canadian labour market information(LMI). Improved LMI would have helped these candidates make a more informed
decision to immigrate to Canada. Moreover, LMI would have better prepared candidates
to integrate in the Canadian labour force by providing information about specificoccupations and their required skills. Improved information access would, thus, haveincreased the number of newcomers more suitable to Canada’s labour needs andrequirements.

Improvements in Foreign Credential Recognition – Credential recognition has been amajor barrier to employment for new immigrants. Between 2006 and 2019, the process torecognize new immigrants’ foreign credentials could have improved, as several

51
government efforts have been made. For example, the Foreign Credential Recognition
Program, created in 2003, provides financial support to key agencies involved in thecredential recognition process. In 2007, the Foreign Credentials Referral Office wasestablished to provide immigrants with essential information on the credential recognition
process and useful services (Canada, 2009). However, further research is needed todetermine whether the process of foreign credential recognition has, in fact, improved
during this period.
While new immigrants improved in absolute and relative participation, employment, andunemployment rates over this period, they experienced less improvement in earnings. From 2006
to 2019, the wage gap between new immigrants and the Canadian-born was consistently large,
particularly for the university-educated. Although absolute earnings for new immigrants andrelative earnings for very recent immigrants have increased since 2006, the relative earnings ofrecent immigrants deteriorated over the period. The following are potential reasons for the
weaker improvement in relative earnings for recent immigrants:Barriers for Immigrants – Compared to the Canadian-born, new immigrants face moreobstacles that may negatively affect earnings more than employment. For example,
immigrants likely face more discrimination, struggle with language barriers, and lack the
networks for promotion. These barriers prevent immigrants from obtaining promotions orjobs with high earnings.

“Brain Waste” & Job Mismatching – Highly educated newcomers to Canada could be
employed in low-skilled jobs, a phenomenon known as “brain waste”. As immigrants
with higher educational attainment faced relatively higher unemployment rates than their
Canadian-born counterparts between 2006 and 2019, many of these newcomers could
have resorted to obtaining jobs for which they were overqualified. A lack of improvement
in job mismatching over this period could explain why the relative wages of new
immigrants with university degrees were noticeably low, despite high employment rates.

52

VII. Summary and Conclusion
This final section summarizes the key findings in this report. It provides an overview of
the changes in absolute and relative labour market outcomes between 2006 and 2019 byimmigrant status and education level. In addition, it provides the changes in average labour
market outcomes between the 2006-2010 period and 2015-2019 period. Finally, this section
offers concluding remarks and suggestions for future research.
Table 6: Absolute Change in Labour Market Outcomes for New Immigrants, 2006-2019
Panel A: Values
No Degree,
Certificate
or Diploma

High
SchoolGraduate

5.4

-0.9

4.3

12.7

Employment Rate

6.8

-0.2

6.3

14.6

6.2

5.2

Unemployment Rate

-3.0

-1.3

-4.0

-4.8

-2.6

-2.6

Real Average Hourly Wages

3.07

2.32

2.82

0.45

2.08

2.86

Participation Rate

4.7

0.8

2.4

2.6

2.9

1.5

Employment Rate

6.0

3.8

2.6

3.3

4.2

2.3

Participation Rate
Very Recent
Immigrants

RecentImmigrants

High
PostSchool
SecondaryGraduate,
Certificate
Some Postor Diploma
Secondary
Percentage Points & Constant 2012 Dollars ($)

Total, All
Education
Levels

4.6

University
Degree

3.5

Unemployment Rate

-2.3

-7.0

-0.4

-1.6

-1.9

-1.1

Real Average Hourly Wages

2.16

2.12

2.76

2.22

1.66

0.68

Total, All
Education
LevelsNo Degree,
Certificate
or Diploma

High
SchoolGraduate

PostSecondary
Certificate
or Diploma

University
DegreeParticipation Rate

+

-

+

High
SchoolGraduate,
Some PostSecondary+++

Employment Rate

+

-

+

+

+

+

Unemployment Rate

+

+

+

+

+

+

Real Average Hourly Wages

+

+

+

+

+

+

Participation Rate

+

+

+

+

+

+

Employment Rate

+

+

+

+

+

+

Unemployment Rate

+

+

+

+

+

+

+

+

+

+

+

Panel B: Summary

Very Recent
Immigrants

RecentImmigrants

Real Average Hourly Wages+
Source: Based on Data Appendix Tables 5, 6, 7, 8
Note: “+” denotes an improvement, and “-“ denotes a deterioration.

Table 6 shows the absolute change in labour market outcomes for new immigrants from2006 to 2019. The aggregate employment rates of recent and very recent immigrants experienced
the most improvement with an increase of 6.0 and 6.8 percentage points, respectively. Bothgroups also saw an increase in participation rates across education levels; the participation rate ofvery recent immigrants increased by 5.4 percentage points between 2006 and 2019, while therate of recent immigrants increased by 4.7 percentage points. The unemployment rates of recent

53
and very recent immigrants decreased by 2.3 and 3.0 percentage points, respectively. Real wages
also increased for both groups, though the wages for university-educated recent immigrants only
increased by 68 cents from 2006 to 2019. Table 6 indicates that 46 out of 48 outcomes for new
immigrants improved over the period. All 24 outcomes improved for recent immigrants, while
22 out of 24 outcomes improved for very recent immigrants.
Table 7: Change in Labour Market Outcomes for New Immigrants Relative to Outcomes of theCanadian-Born in Canada, 2006-2019
Panel A: Values
High
SchoolGraduate,
Some PostSecondary
Percentage Points

PostSecondary
Certificate
or Diploma

University
Degree12.0

10.2

Total, All
Education
LevelsNo Degree,
Certificate
or Diploma

High
SchoolGraduate

11.7

10.1

19.1

Employment Rate

13.7

9.9

22.9

28.7

13.9

12.1

Unemployment Rate

-32.2

0.8

-89.2

-78.9

-38.4

-86.7

Average Hourly Wages

1.9

4.4

8.8

-3.8

1.3

3.7

Participation Rate

11.0

15.5

17.6

10.3

10.2

8.3

Employment Rate

12.8

22.5

18.5

11.6

11.8

9.1

Unemployment Rate

-26.1

-48.5

-31.1

-31.4

-30.3

-36.7

Average Hourly Wages

-3.1

2.5

7.9

5.7

-1.2

-3.9

Total, All
Education
LevelsNo Degree,
Certificate
or Diploma

High
SchoolGraduate

PostSecondary
Certificate
or Diploma

University
DegreeParticipation Rate

+

+

+

High
SchoolGraduate,
Some PostSecondary+++

Employment Rate

+

+

+

+

+

+

Unemployment Rate

+

-

+

+

+

+

Average Hourly Wages

+

+

+

-

+

+

Participation Rate

+

+

+

+

+

+

Employment Rate

+

+

+

+

+

+

Unemployment Rate

+

+

+

+

+

+

Average Hourly Wages
Source: Based on Data Appendix Tables 5, 6, 7, 8

-

+

+

+

-

-

Participation Rate
Very Recent
Immigrants

RecentImmigrants

24.5

Panel B: Summary

Very Recent
Immigrants

RecentImmigrants

Table 7 shows that recent and very recent immigrants enjoyed an improvement in relative
participation, unemployment, and employment rates for all education levels. The participationand employment rates of the immigrant groups relative to those of the Canadian-born increased
for every education level, while relative unemployment rates decreased for most levels. The
magnitudes of the changes in relative labour market outcomes for new immigrants weresignificantly large. The relative participation and employment rates of very recent immigrants
increased by 11.7 and 13.7 percentage points, respectively, while the relative participation and54
employment rates of recent immigrants grew by 11.0 and 12.8 percentage points, respectively.
Most notably, the relative unemployment rates of recent and very recent immigrants decreased
by 26.1 and 32.2 percentage points, respectively. These large improvements were consistentacross education levels. Table 7 indicates that 43 out of 48 outcomes improved from 2006 to
2019.
The majority of outcomes that deteriorated over the period were relative wages. Althoughvery recent immigrants experienced positive change in relative wages for most education levels,
recent immigrants faced a decline from 2006 to 2019, which was largely driven by thedeteriorating relative wages of highly educated workers. However, the 2015-2019 period saw
positive change in the relative wages of recent immigrants across education levels, whichsuggests that relative earnings improved towards the end of the 2006-2019 period but remained
below the level of relative wages for 2006.25 Although relative earnings did improve duringcertain periods, the change in relative average hourly wages was much weaker compared to theimprovements in other outcomes. Between 2006 and 2019, the relative wages of very recent
immigrants increased by only 1.9 percentage points, while the relative wages of recent
immigrants decreased by 3.1 percentage points.

Table 8: Average Labour Market Outcomes for New Immigrants, 2006-2010 and 2015-2019
Panel A: Change in Average Levels from 2006-2010 to 2015-2019

Very Recent
Immigrants

RecentImmigrants

High
PostSchool
SecondaryGraduate,
Certificate
Some Postor Diploma
Secondary
Percentage Points & Constant 2012 Dollars ($)

Total, All
Education
LevelsNo Degree,
Certificate
or Diploma

High
SchoolGraduate

Participation Rate

2.2

-5.0

-0.8

5.0

3.6

2.0

Employment Rate

3.9

-4.5

1.6

7.7

6.0

3.6

University
DegreeUnemployment Rate

-2.9

1.2

-3.8

-5.2

-3.6

-2.3

Real Average Hourly Wages

1.66

1.46

1.49

0.43

0.98

1.45

Participation Rate

2.5

-0.9

1.0

2.4

2.2

0.3

Employment Rate

4.0

0.6

2.6

4.1

4.4

1.3

Unemployment Rate

-2.4

-3.2

-2.5

-3.0

-3.0

-1.2

Real Average Hourly Wages

0.84

1.40

1.44

0.68

0.92

-0.15

PostSecondary
Certificate
or Diploma

University
Degree++++Panel B: Summary of Change in Average Levels between Periods 2006-2010 and 2015-2019

Very Recent
Immigrants

25

Total, All
Education
LevelsNo Degree,
Certificate
or Diploma

High
SchoolGraduate

Participation Rate

+

-

-

High
SchoolGraduate,
Some PostSecondary+

Employment Rate

+

-

+

+

Refer to Data Appendix Table 15 for the change in relative outcomes from 2006 to 2010 and from 2015-2019.

55
Unemployment Rate

+

-

+

+

+

+

Real Average Hourly Wages

+

+

+

+

+

+

Participation Rate

+

-

+

+

+

+

Employment Rate

+

+

+

+

+

+

Unemployment Rate

+

+

+

+

+

+

Real Average Hourly Wages
Source: Based on Data Appendix Tables 5, 6, 7, 8

+

+

+

+

+

-

RecentImmigrants

Table 9: Average Labour Market Outcomes for New Immigrants Relative to Outcomes of theCanadian-Born in Canada, 2006-2010 and 2015-2019
Panel A: Change in Average Levels from 2006-2010 to 2015-2019

Very Recent
Immigrants

RecentImmigrants

High
SchoolGraduate,
Some PostSecondary
Percentage Points

PostSecondary
Certificate
or Diploma

University
Degree

12.7

9.7

6.4

17.5

12.8

8.3

-64.6

-79.6

-66.1

-90.5

4.4

0.6

0.2

1.8

11.7

9.2

8.1

4.7

Total, All
Education
LevelsNo Degree,
Certificate
or Diploma

High
SchoolGraduate

Participation Rate

6.6

-2.3

8.3

Employment Rate

9.0

-4.0

11.9

Unemployment Rate

-32.3

17.9

Average Hourly Wages

0.4

3.2

Participation Rate

7.3

8.3

Employment Rate

9.4

11.0

14.5

12.2

11.1

5.9

Unemployment Rate

-27.6

-16.7

-41.4

-48.0

-54.4

-47.7

Average Hourly Wages

-3.7

2.4

3.9

1.8

-0.5

-3.5

PostSecondary
Certificate
or Diploma

University
Degree++Panel B: Summary of Change in Average Levels between Periods 2006-2010 and 2015-2019
Total, All
Education
LevelsNo Degree,
Certificate
or Diploma

High
SchoolGraduate

Participation Rate

+

-

+

High
SchoolGraduate,
Some PostSecondary+

Employment Rate

+

-

+

+

+

+

Unemployment Rate

+

-

+

+

+

+

Average Hourly Wages

+

+

+

+

+

+

Participation Rate

+

+

+

+

+

+

Employment Rate

+

+

+

+

+

+

Unemployment Rate

+

+

+

+

+

+

Average Hourly Wages
Source: Based on Data Appendix Tables 5, 6, 7, 8

-

+

+

+

-

-

Very Recent
Immigrants

RecentImmigrants

Table 8 shows the change in average labour market outcomes for new immigrants fromthe 2006-2010 period to the 2015-2019 period.26 Most outcomes improved. For very recent
immigrants, deteriorated outcomes were concentrated at lower education levels; the participation,
26

Refer to Data Appendix Table 16 for the average labour market outcomes for new immigrants from 2006 to 2010
and from 2015 to 2019.

56
employment, and unemployment rate deteriorated for workers with no, degree, certificate, or
diploma, while the participation rate deteriorated for high school graduates. For recent
immigrants, only two outcomes deteriorated: real wages for university graduates and theparticipation rate for workers without qualifications. Table 8 shows that new immigrants
improved in 42 of 48 outcomes.
Table 9 summarizes the change in average labour market outcomes for new immigrants
relative to those of the Canadian-born from the 2006-2010 period to the 2015-2019 period.27 The
relative labour outcomes of new immigrants generally improved between the two periods.
However, it is important to consider that the unemployment rates of both immigrant groups
remained much higher than the rate of the Canadian-born, and wages remained lower.
Nevertheless, Table 9 shows that new immigrants experienced significant improvement in labour
market performance, achieving improvement in 42 of 48 outcomes. For recent immigrants, alloutcomes improved, apart from relative wages, which declined in the aggregate and for workers
with post-secondary education. The results in Table 9 are similar to those in Table 6, signifyingthat the findings for the changes in immigrant labour market outcomes are robust.
Table 10: Summary of Outcomes
Very Recent Immigrants

Change in Absolute
Outcomes
Change in Relative
Outcomes

Recent Immigrants

Total New Immigrants

Period

+

-

+

-

+

-

2006-2019

22

2

24

0

46

2

(2006-2010) to (2015-2019)

20

4

22

2

42

6

2006-2019

22

2

21

3

43

5

21

3

42

6

(2006-2010) to (2015-2019)213
Note: “+” denotes an improved outcome, and “-“ denotes a deteriorated outcome

Table 10 summarizes the number of improved and deteriorated outcomes for new
immigrants from 2006 to 2019 and from the 2006-2010 period to the 2015-2019 period. Recent
and very recent immigrants had 24 outcomes for each period. In terms of absolute outcomes,
very recent immigrants had 22 improved and 2 deteriorated outcomes, while recent immigrants
had 24 improved and no deteriorated outcomes from 2006 to 2019. In terms of relative
outcomes, very recent immigrants had the same number of improved and deteriorated outcomesas the absolute. Recent immigrants, on the other hand, had 21 improved outcomes and 3
deteriorated. Both group had the same number of improved and deteriorated outcomes for thechange in average relative outcomes from period 2006-2010 to 2015-2019: 21 improved and 3
deteriorated. Therefore, the majority of outcomes improved for both very recent and recent
immigrants.

27

Refer to Data Appendix Table 17 for the average labour market outcomes for new immigrants relative tooutcomes of the Canadian-born from 2006 to 2010 and from 2015 to 2019.

57
In conclusion, LFS estimates indicate that very recent and recent immigrants delivered an
improved labour market performance across education levels from 2006 to 2019. New
immigrants were major assets to the Canadian labour force, due to their younger average age andhigher average education than the Canadian-born. In absolute and relative terms, new immigrants
enjoyed a significant increase in employment and participation rates. Although unemployment
rates remained much higher than the rate of the Canadian-born, new immigrants benefited from asubstantial decline in absolute and relative unemployment rates over the period. Most
significantly, new immigrants experienced more improvement in participation, employment, andunemployment rates compared to Canadian-born workers. However, relative wages were thenotable exception to new immigrants’ improvement in the labour market. A substantial earnings
gap between new immigrants and the Canadian-born persisted throughout the period, andrelative wage growth was weak for recent immigrants, particularly for highly educated workers.
While the labour performance of new immigrants generally improved between 2006 and 2019,researchers and policymakers should address the issue of high unemployment rates and low
relative earnings to enhance the integration of immigrants into the labour market.
As this report does not control for variables other than education level, further researchshould examine whether the improved results for the labour performance of new immigrants
would hold under more specific contexts. For example, studies could compare immigrant labour
market outcomes in Canada across geographical areas (e.g. regions, provinces/territories),
immigrant characteristics (e.g. gender, race, country of origin, immigrant categories including
economic immigrants and refugees), and occupation (e.g. industry, high-skilled vs. low-skilledjobs). Furthermore, as previously discussed, more research is required to determine the reasonsfor new immigrants’ improvement in the Canadian labour market. For example, studies could
explore whether government supports for immigrants have improved and impacted the labour
outcomes of new immigrants. Finally, future research should also focus on new immigrants’
weaker outcomes in unemployment rates and earnings: why did highly educated new immigrants
consistently have high unemployment rates and low relative wages between 2006 and 2019?
More research should explore the potential factors behind these outcomes, such as discrimination
and “brain waste”. In particular, research on job mismatching using more recent data would help
determine whether “brain waste” could explain new immigrants’ relatively low wages despitehigh employment rates. Given the increasing significance of highly skilled immigrants in the
Canadian labour market, further monitoring and research on the labour performance of new
immigrants is imperative.

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