New immigrants to Canada are significantly worse off financially than earlier generations of newcomers, says a recent University of Toronto study. One of the reasons for this shift is the rising level of education in native-born Canadians, making it difficult for new immigrants -- who also have higher education and skill levels than in the past -- to compete for jobs, says Professor Jeffrey Reitz of sociology and the Centre for Industrial Relations. This trend, coupled with a lower valuation of immigrants' skills by employers, has widened the income gap between native-born Canadians and immigrants. "As the labour market pushes more towards high technology and a 'knowledge-based' economy, there has been a heavier emphasis on Canadian university degrees over foreign degrees," says Reitz, author of Immigrant Success in the Knowledge Economy.
Reitz, whose study examines the employment status and earnings of various immigrant groups from the early 1970s to the mid-1990s, found the income gap between newly arrived immigrants and native-born Canadians has widened over the years. For instance, in 1981, newcomers were nearly as likely to have jobs as native-born workers and their income averaged about 80 per cent of earnings of those of native-born Canadians. But in 1996, new immigrants had much less success finding jobs and, of those who did, their earnings averaged only about 60 per cent of the earnings of the native-born.
"If this situation continues, more immigrants will descend into poverty which will threaten the success of our immigration programs," Reitz says. He indicates that the current immigration policy of selecting highly skilled new immigrants cannot, by itself, solve the problem of declining incomes of immigrants. "Employers need to re-evaluate the credentials of newly arrived immigrants and re-evaluate how transferable their skills are to Canada," says Reitz.
U of T Public Affairs