Back to "The Real Unemployment Rate"
Thursday, April 27, 2000
Andrew Duffy
Southam News
Recent immigrants, struggling to find a place in Canada's new economy, are significantly worse off than earlier generations of newcomers, a new study shows.
University of Toronto sociology professor Jeffrey Reitz used census data from the 1980s and 1990s to compare the relative success of immigrants to their predecessors and to native-born Canadians.
He found that -- contrary to what many believe -- new immigrants have been losing economic ground.
"The downward trends in immigrant employment and earnings are large and represent a serious problem, getting worse," Mr. Reitz concludes in the study prepared for the U of T Centre for Industrial Relations.
The study found that, in 1996, new immigrants brought home less money relative to other Canadians than at any other time in the previous 25 years.
The findings raise new questions about the benefits of immigration at a time when Immigration Minister Elinor Caplan is calling for a 55-per-cent increase in the number of newcomers accepted by Canada.
Ms. Caplan maintains that higher immigration levels will be essential to this country's economic growth as its population ages and its birth rate declines.
But Mr. Reitz's study challenges that notion.
"Now," he says, "the persistent trend toward declining immigrant earnings threatens the place of immigration as one of the keys to Canada's economic success."
The study found that in 1996, new immigrants made just 60 per cent of what the average Canadian earned. In 1981, newcomers -- those in the country less than five years -- earned 80 per cent of what native-born Canadians made and had virtually the same employment level.
Mr. Reitz says that Canadians, increasingly educated, are taking high-skilled jobs that were once the preserve of well-educated immigrants.
Immigrants used to enjoy an education advantage over Canadians, but that gradually disappeared between 1971 and 1991 as this country invested heavily in its school systems.
And since employers normally discount overseas credentials -- some foreign qualifications are not recognized at all -- Canadians stretched their natural employment and earnings advantages.
"For immigrants, the trend seems to be toward exclusion from the knowledge economy," Mr. Reitz says.
According to the study, the average Canadian-born man earned $33,887 in 1996, while male immigrants earned an average of $20,603 over their first five years in the country.
In 1981, the difference between the two groups' earning power was less than $4,000.
Mr. Reitz breaks down the earnings of new immigrants by race in an effort to determine if the trend can be explained by some kind of identifiable discrimination.
He found that white immigrants, in fact, suffered the most steady decline in their earnings between 1981 and 1996 relative to native-born Canadians.
A similar but slightly less negative trend was found for blacks and Chinese immigrants.
Mr. Reitz concludes that the across-the-board decline will inevitably translate into higher rates of poverty among immigrants and, in turn, more government expenditures on social programs and services.
"If this situation continues, more immigrants will descend into poverty, which will threaten the success of our immigrant programs," he said.
"This situation strongly suggests that we need to step back and look at the changing requirements of the Canadian economy and the way in which immigrants fit into these changes."
Last month, Ms. Caplan introduced new legislation that puts more emphasis on a prospective immigrant's language and education levels.
Ms. Caplan has said higher immigration levels -- up to 300,000 people a year -- are needed to continue Canada's economic growth.
Last year, Canada accepted about 180,000 newcomers.