Recently, Statistics Canada released their report “Immigration selection factors and the earnings of principal applicants”. The report was an update of the 2015 investigation that helped guide development of Express Entry’s Comprehensive Ranking System (CRS); the main way that skilled foreign workers are assessed by Immigration Refugees and Citizenship Canada (IRCC).
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Analyzing the 2005-2015 immigration cohort (and their earnings from 2006-2017), the study looked at what characteristics of applicants (at the time of landing) were the most predictive of the earnings in Canada, for the short (one to two years), medium (five to six years), and long-term (10 to 11 years).
The primary traits measured at landing were:
- Years of pre-landing Canadian work experience (compared to those with no experience);
- Ability in official languages (English or French (Native speakers VS. Less proficiency);
- Age—Younger (25-29 years) VS. Older (50-54 years); and
- Education (Bachelor’s VS. Secondary school education);
What impacts short-term earnings for immigrants in Canada?
According to the study, the main factors that impacted the short-term earnings of immigrants included:
- Pre-landing Canadian work experience, which was the strongest predictor of earnings in the first one to two years of immigration—every year of Canadian work experience equated to an 84% increase in earnings;
- Language ability—those who had a mother tongue other than French or English, (but who spoke English) earned 29% less than those who had either French or English as a mother tongue; and
- Education, showing those who had received a Bachelor’s degree (15 years of schooling) earned 12-24% more in the short-term.
What impacts medium-term earnings for immigrants in Canada?
Per the results of the study, medium-term earnings were impacted by:
- Pre-landing Canadian work experience—still the strongest predictor of earnings five plus years after landing: every one year of Canadian work experience equated to a 52-59% increase in earnings;
- Language ability, as those with an official language as their mother tongue earned 42% more;
- Age, which had a stronger correlation to earnings than in the short-term (i.e.: older immigrants earned 27-35% less than younger ones); and
- Education; with Bachelor’s degree graduates earning 14-21% more.
What impacts long-term earnings for immigrants in Canada?
According to the study, long-term earnings for immigrants were influenced by:
- Pre-landing Canadian work experience—even after a decade remaining the most impactful factor—weakened to a 45% increase for every one year of Canadian work experience;
- Age at landing, revealing that younger immigrants earned 44% more than older ones, even 10-11 years after landing;
- Official language ability, which reduced earnings of those less proficient in official languages by 35%; and
- Education, which yielded a stronger effect: a 23% increase in earnings for those with a Bachelor’s degree.
To summarize…
As the years in Canada increased for immigrants, the negative effects of age at landing increased; the positive effects of education at landing increased; and the positive effects of official language ability and pre-landing Canadian work experience gradually decreased.
The hidden variable: Pre-landing earnings
There was also another variable that Statistics Canada measured at landing for immigrants in the cohort: pre-landing earnings.
When considered into the analysis, pre-landing earnings accounted for more impact on short, medium, and long-term earnings than any other variable considered in the study. It was by far the most predictive factor of immigrant earnings success across the board.
The study comes to the conclusion that this may be down to the fact that pre-landing earnings are associated with a number of factors, including education, pre-landing work experience, and language ability.
The study further suggests that it may be the quality of pre-landing work experience (and especially pre-landing Canadian work experience) that appears to be the most predictive factor in an immigrant’s earnings in the short, medium, and long-term.
How does this study influence immigration?
This study is an update of the study published in 2015, that served as the initial technical guide to the Comprehensive Ranking System— the ranking system that IRCC uses when assessing economic candidates for immigration through Express Entry (the federal government’s main stream of economic immigration).
Thus, candidates looking to apply through Express Entry’s system of programs (including the Federal Skilled Worker Program (FSWP), Federal Skilled Trades Program (FSTP), and the Canadian Experience Class (CEC) should understand the results of this study, and the weighting that it gives to certain immigrant traits (for example the quality of pre-landing Canadian work experience, and age).
CRS factors are also covered in this study (education, official language ability, etc.); and updates in the CRS weighting given to these factors may follow along the lines this study has illuminated.
Skilled worker candidates eligible for Express Entry, may also apply to the Provincial Nominee Program (PNP). The PNP is another economic immigration program wherein provinces and territories are able to nominate skilled workers for immigration to their provinces, allowing them to arrive and settle in Canada as permanent residents. Receiving a provincial nomination can also help with Express Entry success through the Enhanced Provincial Nomination—giving candidates an additional 600 CRS points, and virtually guaranteeing an Invitation to Apply (ITA).
