The median entry wage of new immigrants decreased by 10.6% in 2023 but remained above its pre-COVID-19 pandemic level

Of note:

The median wage earned by new immigrants in Canada one year after admission can be a good predictor of their future economic outcomes. The real median entry wage (after adjusting for inflation) of newcomers decreased by 10.6% from 2022 to 2023, the largest decline since 1991.

This drop among immigrants from 2022 to 2023 occurred amid a 1.1% increase in the overall real median wage of Canadians over this period. While entry wages decreased across most immigrant categories, the overall decline is partly related to the fact that the proportion of immigrants admitted as principal applicants under the Canadian Experience Class (CEC), who typically have a higher entry wage, reached an all-time high in 2021, but fell below 2019 pre-COVID-19 pandemic levels in 2022.

This Daily release explores the economic outcomes of recent immigrants in the 2024 Longitudinal Immigration Database (IMDB). It outlines variations in the economic outcomes of newcomers by admission category, pre-admission experience and province. The IMDB is the result of a collaboration between Statistics Canada, Immigration, Refugees and Citizenship Canada (IRCC), and the provinces.

Infographic 1 
Median entry wage of immigrants and percentage change from previous year, tax year 1990 to 2023

The median entry wage for new immigrants decreases more in 2023 than in 2020, but remains higher than every other year prior to 2021

The median entry wage of immigrants steadily increased from 2010 to 2022, except in 2020 when wages were impacted by the pandemic.

From 2020 to 2021, the real median entry wage of immigrants rose by over one-fifth (+21.2%), increasing from $34,400 to $41,700. It then rose a further 6.7% year over year to $44,500 in 2022. In 2023, the median entry wage of immigrants declined by 10.6% to $39,800 but remained higher than the median entry wage in 2020 ($34,400) and every other year prior to 2021.

This was a relatively large decline, given that the overall real median wage of Canadians increased by 1.1% to $47,650 in 2023.

The decrease in the number of Canadian Experience Class principal applicants admitted in 2022 may contribute to the overall decline of the median entry wage of new immigrants in 2023

In 2023, immigrants from each of the main admission categories saw their median entry wage decline compared with the previous year. Specifically, the median entry wage declined for spouse and dependent economic immigrants (-7.3% year over year to $34,400), for immigrants sponsored by family (-4.1% to $30,300) and for refugees (-1.9% to $25,900).

Economic principal applicants, who are selected for their ability to contribute to Canada’s economic development, had the highest median entry wage among the four main admission categories at $51,500 in 2023. While this was a 5.5% decline from the previous year, each of the specific programs within the economic principal applicant stream experienced smaller decreases or even increases in entry wage.

In 2023, CEC principal applicants, who are selected based on their Canadian work experience, remained the admission category with the highest median entry wage. Their median entry wage rose 3.4% to $60,600 in 2023, following a decline in 2022 from its peak in 2021 ($71,000).

In 2023, principal applicants from the skilled worker and skilled trades (-4.4% to $56,000) and provincial/territorial nominee (-3.8% to $47,700) programs saw their entry median wages decrease from a year earlier. Business (-2.4% to $24,900) and caregiver (+4.9% to $38,500) principal applicants had the lowest entry income among economic principal applicants.

The decreases in the median entry wages by admission categories in 2023 were mostly smaller than what was observed for the overall immigrant population (-10.6%). This discrepancy is likely related to changes in the makeup of the immigrant population and their admission categories.

In 2021, IRCC specifically invited express entry candidates, who were more likely to be physically located in Canada and therefore less impacted by pandemic-related border restrictions, to apply for permanent residency. This was done, in part, by increasing the number of immigrants admitted through the CEC program, the category with the highest median entry wage. Specifically, the share of immigrants aged 15 years and older admitted as CEC principal applicants increased from 12% in 2020 to 27% in 2021. This change contributed to the growth of the entry wage of all new immigrants in 2022. With the removal of border restrictions in 2022, CEC principal applicants were less targeted, and their share declined to 5% in that year. This, in addition to the other factors at play during the post-pandemic period, contributed to the overall reduction in the entry wages of new immigrants in 2023….

Source: The median entry wage of new immigrants decreased by 10.6% in 2023 but remained above its pre-COVID-19 pandemic level