Longitudinal Immigration Database: Immigrants’ income trajectories during the initial years since admission

Usual useful analysis by StatsCan, in particular the highlighting of how two-step immigration is resulting in stronger economic outcomes for the economic class:

The COVID-19 pandemic has impacted the lives of Canadian immigrants in many ways. To assess these impacts, it is important to know where Canadian immigrants stood economically right before the outbreak of the pandemic. Based on the latest available data from the 2020 Longitudinal Immigration Database (IMDB), the present article serves this goal by focusing on immigrant wages in recent years, including 2019. This will provide a baseline for comparison once data for 2020 are available.

Immigrants admitted to Canada in 2018 had a median wage of $31,900 in 2019. This was 4.2% higher than the median entry wage of immigrants admitted in 2017 ($30,600). In fact, immigrants admitted in 2018 had the highest median entry wage, reported one year after admission, among all immigrants admitted since 1981. Despite that, their median wage was still 17.8% lower than the 2019 median wage of the total Canadian population ($38,800).

Compared with those admitted in 2017, immigrants admitted in 2018 experienced median entry wage increases in all provinces, except Alberta, and Newfoundland and Labrador. A closer look by immigration category and pre-admission experience sheds light on differences among various groups of immigrants admitted in 2018, compared with their counterparts admitted in 2017 as well as the Canadian population in corresponding years.

Median wage of economic immigrant principal applicants surpasses that of the Canadian population one year after admission 

Principal applicants of economic categories are selected for their ability to be integrated into the Canadian labour market and to contribute to the economy. Most of them have post-secondary education and knowledge of at least one official language. Immigrants admitted under those categories in 2018 had a median wage of $43,600 in 2019, 12.4% higher than the Canadian median wage in the same year ($38,800) and 3.8% higher than the median entry wage of their counterparts admitted in 2017 ($42,000).

While the median wage of economic principal applicants surpassed that of the Canadian population one year after admission, those of all other immigrants were still less than the Canadian median wage.

The median entry wage of economic immigrant dependents admitted in 2018, spouses included, was $27,600. While lower than the 2019 Canadian median wage, this number was 7.0% higher than that of their counterparts admitted in 2017 ($25,800).

There was no change in the median entry wage between family sponsored immigrants admitted in 2017 and 2018 ($24,500). The median entry wage of refugees ($19,200) was the lowest among immigrants admitted in 2018, though it was 2.7% higher compared with that of their counterparts admitted in 2017 ($18,700).

Economic principal applicants are selected on the basis of their education, specific skills and work experience. The vast majority (96.1%) of immigrant taxfilers admitted under this category in 2018 had completed some post-secondary education at the time of their admission. Economic principal applicants are also more likely to have pre-admission experience in Canada. Among those admitted under this category in 2018, almost two-thirds (64.5%) of them had pre-admission experience in Canada, in contrast with their counterparts admitted as refugees (33.3%), through family sponsorship (32.7%), or as dependents of economic immigrants (32.6%).

Pre-admission experience in Canada, particularly work-related, plays an important role in lifting immigrants’ wages, as it provides a pathway for immigrants to acquire language skills and knowledge of the Canadian labour market. Immigrant taxfilers having both study and work permits prior to immigration obtained the highest median wage one year after admission, both for those admitted in 2017 ($44,900) and in 2018 ($44,600). Immigrants only having work permits prior to immigration obtained the second highest median wage one year after admission ($39,900 for those admitted in 2017 and $39,300 for the 2018 admission cohort). Immigrants admitted with pre-admission work-related experience in 2017 and 2018 already had median wages higher than those of the Canadian population in 2018 ($38,200) and 2019 ($38,800), respectively.

Immigrants without pre-admission experience had lower median entry wages than immigrants with Canadian work experience prior to their admission. Their median entry wage was $23,100 for those admitted in 2017 and $25,700 for those admitted in 2018.

Among immigrants with pre-admission experience in Canada, those with study permits only prior to admission had the lowest median entry wages in 2018 ($14,400) and 2019 ($15,100). However, this group of immigrants is on average younger than their counterparts in all other groups, and therefore has a strong potential to increase their earnings as their careers unfold in the Canadian labour market. Furthermore, they are also more likely to have part-time jobs; information about whether or not their employment was full-time, full-year is unavailable.

Chart 1  
Median entry wage of immigrants admitted in 2017 and 2018, by pre-admission experience

Chart 1: Median entry wage of immigrants admitted in 2017 and 2018, by pre-admission experience

Median wages increase over time with different outcomes for men and women according to their immigration category

When tracking changes over time, a focus on immigrant men and women admitted at age 18 or older in 2009 shows that median wages increased across all immigration categories and for both men and women from 2010 to 2019. However, such increases benefited immigrant men and women differently.

Both economic principal applicant men and women admitted in 2009 had median wages far above those of their counterparts in all other categories throughout the 10-year period. The median wage of men nearly doubled, from $32,500 in 2010 to $62,300 in 2019, with an average annual increase rate of 10.2%. The median wage of their woman counterparts nearly doubled as well, from $24,500 to $44,900 over the same period, with an average 9.3% annual increase. Among economic principal applicants, women’s median wage started lower than men’s and men’s median wage increased faster than women’s. As a result, the median wage gap widened between men and women over time in favour of men.

The opposite pattern is observed among all other immigration categories. Although women’s median wage was even lower than men’s within each of those categories, it increased faster than men’s. During the 10-year observational period, men’s median wage increased among economic dependents, refugees, and family sponsored immigrants with average annual increase rates of 11.9%, 10.2% and 10.0%, respectively. The average annual rates of increase for women were 15.4%, 14.4% and 13.1%, respectively, for economic dependents, refugees and family sponsored immigrants. With women’s higher increase rates of their median wages, the median wage gap narrowed between men and women within each of those immigration categories over time in favour of women.

Chart 2  
Median wage of immigrant men admitted in 2009 by immigration category, 2010 to 2019 

Chart 2: Median wage of immigrant men admitted in 2009 by immigration category, 2010 to 2019

Chart 3  
Median wage of immigrant women admitted in 2009 by immigration category, 2010 to 2019

Chart 3: Median wage of immigrant women admitted in 2009 by immigration category, 2010 to 2019

Pay ratio of immigrant women versus men increases over time for all immigration categories except economic principal applicants

Pay disparity between women and men is an important social, economic, and political issue. As immigration aims to respond to Canada’s need for labour supply, the gender parity and successful settlement of women in the labour market is key to achieving Canada’s objectives. To measure the median gender pay ratio, the median annual wages, salaries and commissions of women were divided by the median annual wages, salaries and commissions of men.

From 2010 to 2019, the gender pay ratio for Canadians increased from 67.9% to 72.6%. Among immigrants admitted as adults in 2009, the gender pay ratio followed a similar pattern: 65.5% in 2010 compared with 69.6% in 2019. The gender pay ratio, however, differed by immigration category during this period.

The increasing gender pay ratio was seen in all immigration categories, except economic principal applicants. From 2010 to 2019, the gender pay ratio increased from 57.2% to 65.5% among family sponsored immigrants, from 65.4% to 75.1% among dependents of economic immigrants, and from 63.5% to 75.9% among refugees.

For economic principal applicants, however, the gender pay ratio slightly decreased from 75.4% in 2010 to 72.1% in 2019. Further analysis would be required to understand the reasons behind this trend.

Chart 4  
Median pay ratio of immigrant women versus men admitted in 2009 by immigration category, 2010 to 2019

Chart 4: Median pay ratio of immigrant women versus men admitted in 2009 by immigration category, 2010 to 2019

Within immigration categories, the wage gap between women and men decreased overtime, except for economic principal applicants. Although the median wage of economic principal applicant women increased greatly over time, their man counterparts had a larger increase, resulting in a widening of the median wage gap between immigrant women and men.

This article is the first part of a two-part series about recent immigrants’ outcomes using data from the Longitudinal Immigration Database. The second part will discuss immigrants’ mobility.

Source: https://www150.statcan.gc.ca/n1/daily-quotidien/211206/dq211206b-eng.htm?CMP=mstatcan

About Andrew
Andrew blogs and tweets public policy issues, particularly the relationship between the political and bureaucratic levels, citizenship and multiculturalism. His latest book, Policy Arrogance or Innocent Bias, recounts his experience as a senior public servant in this area.

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