StatsCan Study: The long-term economic outcomes of refugee private sponsorship

Of note how the economic outcomes of privately and government-sponsored refugees become similar over time after an initially wide gap:

Canada was the first country to introduce private sponsorship for refugee resettlement. The program has played a key role in the country’s responses to international refugee crises over the last four decades. Private sponsors are responsible for providing financial, material and personal support to refugees during their first year in Canada.

A new Statistics Canada study compares the employment rate and earnings between privately sponsored refugees and government-assisted refugees who were admitted to Canada from 1980 to 2009.

This study is based on the Longitudinal Immigration Database and focuses on refugees who arrived between the ages of 20 and 54 under the two programs (privately sponsored refugees and government-assisted refugees). The analysis follows refugees up to 15 years after they first arrived in Canada.

Refugees are a diverse population with varying degrees of human capital and pre-migration circumstances. Privately sponsored refugees and government-assisted refugees differ in some key socio-demographic characteristics. Over the study period, privately sponsored refugees came more predominantly from Eastern Europe, whereas government-assisted refugees came more often from South and Central America and the Caribbean. Privately sponsored refugees had a higher level of education and tended to be more concentrated in Toronto than government-assisted refugees.

This study compares labour market outcomes of these two groups of refugees, while taking these socio-economic characteristics into account and recognizing that other possible unmeasured differences between the two groups of refugees—such as exposure to violence, duration of displacement, physical and mental health, and ethnic and family networks—could impact their economic outcomes.

This study found that privately sponsored refugees had much higher employment rates and earnings than government-assisted refugees in the initial years after arrival, but this difference diminished over time with government-assisted refugees steadily catching up.

In the first full year after arrival, privately sponsored refugees had higher employment rates than government-assisted refugees, by about 17 percentage points among men and 24 percentage points among women. Fifteen years after arrival, these differences decreased to 3 percentage points among men and 2 percentage points among women.

Similarly, privately sponsored refugees earned 28% more than government-assisted refugees among men and 34% more among women in the first full year after arrival. This gap narrowed to about 5% for both men and women 15 years after arrival.

Furthermore, the employment and earnings advantage of privately sponsored refugees over government-assisted refugees was greater among refugees with less than a high school education than among refugees with higher educational levels. Over half of refugees in the study had less than a high school education.

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