Immigrants Hold Degrees in Significantly Higher Numbers than Native-Born Canadians, a Statistic not Reflected in the Job Market

By WES Staff

Countries such as Canada, which are experiencing shortages in their skilled labor force due to low birth rates and an aging population, are actively seeking to recruit foreign trained workers through immigration initiatives designed to attract workers with higher qualifications. In the case of Canada, these efforts have been highly successful and today, according to recent Census data, immigrants to Canada are considerably better qualified than native-born Canadians. However, the placement of these immigrants in jobs that match their qualifications has not been nearly as successful. Not only do immigrants have a more difficult time finding jobs, but when they do, they are often overqualified for the work and are paid, on average, less than native-born Canadians.

Today in Canada, 18 percent of the population was born outside the country1 with Ontario (31 percent) and British Columbia (28 percent) holding the highest share of immigrants in their core working age populations; both exceeding the national average of 22 percent. Still, according to a recent analysis of Canadian Census labor data,2 foreign-educated immigrants earned C$2.4 billion less annually than native-born Canadians with comparable skills because they work in occupations below their skill level. They also experience higher jobless rates, regardless of the education level obtained outside of Canada. The Conference Board of Canada estimates that the underemployment of immigrants costs the Canadian economy between C$3.5 and C$5 billion a year.3 The logic behind these figures is that if people can find jobs in their field of expertise, they will make more money and contribute more to the economy through spending and investing. Still, there is little indication that the economic performance of immigrants is improving, and sobering statistics indicate that immigrants’ poor success is compounded by race and ethnicity in Canada.

A 2005 study of Canadian Census data by Teelucksingh and Galabuzi’s4 found that visible minority immigrants5 were worst off in the labor market, with many overrepresented in low paying sectors of the economy. By some estimates, 60 percent of skilled immigrants who come to Canada are unemployed or underemployed and the most commonly cited problems are lack of Canadian work experience, language proficiency and lack of recognition for foreign credentials.

Credential evaluations, which verify the authenticity of foreign-earned credentials and determine equivalents to the host country’s education system to make them readily understandable to prospective employers, appears to be one way of bridging this critical gap.

Foreign Credentials Discounted

The issue of credential recognition was analyzed in a 2005 study entitled “the Discounting of Immigrants’ Skills in Canada: Evidence and Policy Recommendations.” 6 The study highlighted how foreign credentials are devalued in the Canadian labor market, leaving many immigrants with considerably lower earnings and fewer job prospects.

Given the current climate of poor economic integration for individuals with foreign credentials in Canada, the government appears to have focused on improving the recruitment of foreign students to the Canadian higher education system as a potential pool of skilled immigrants. This is evidenced in recent changes made by the federal government to student visa and work regulations. However, those immigrants who come to Canada, or are already in Canada, with foreign credentials will not benefit from the new visa regulations. Therefore, it can be argued that one way to successfully integrate highly skilled immigrants into the host society is to increase awareness and knowledge of foreign credentials, a move that would help avoid the creation of an underemployed and disenfranchised underclass.

The Canadian Immigration and Job Market Paradox

A recent study of the 2006 Census data by Jack Jedwab, executive director of the Association of Canadian Studies, found a 20-percentage point gap between visible minority groups and white Canadians in the number of postsecondary credential-holders aged between 35 and 44.7 White Canadians were actually among the least likely to hold a university degree.

Among foreign-born visible minority populations in Canada, the groups most likely to hold a university degree are of Korean descent (74.7 percent of Korean-born 35-44 year-olds), followed by those of Filipino and Chinese descent (58.6 and 58.4 percent respectively). Arab Canadians were the only other visible minority group to top 50 percent (51.6 percent). The study found 48.5 percent of recent Japanese immigrants were university graduates, followed by 47.8 percent of West Asians and 47.4 percent of South Asians, while levels of university attainment for Latin Americans and the Black community were significantly lower at 33 percent and 30.1 percent respectively. Among White Canadians, just 25.9 percent of the relevant age cohort had graduated university.

Among the Canadian-born population in the same age group, the spreads are less pronounced but still significant. Korean-Canadians again topped the list at 58 percent, and were again followed by Chinese-Canadians and Filipino-Canadians (55.1 and 53.5 percent respectively). South Asians were the only other group above 50 percent (51.7 percent), and they were followed by Japanese, West Asians, Arabs, Southeast Asians, blacks and Latin Americans (46.5, 43.4, 38.2, 35.5, 28.4 & 25.6 percent respectively). Non-visible minorities ranked last in the age group at 24.1 percent.

In an interview with the Montreal Gazette,8 Jedwab says that the data are a function of Canada’s immigration policies, which give preference to those with university educations. More than half (51 percent) of those who immigrated to Canada between 2001 and 2006 had a university degree, almost double the 28 percent of immigrants with a university degree arriving prior to 2001, and 2.5 times more than the 20 percent of university-degree holders among the Canadian-born population.

So therein lies the Canadian immigration and job market paradox. While the Canadian government has succeeded in attracting skilled immigrants to the country by reforming its immigration rules, it has yet to convince Canadian industry that overseas credentials are equal to or better than those earned at home. With more than 600,000 skilled workers currently awaiting the green light to relocate to Canada, the time for government, business and other stakeholders to come together and find solutions to the problem is now.

The issue of credential recognition and evaluation is one part of the solution, and one that requires significant attention from the federal government if foreign-educated immigrants are to be successfully integrated into the job market and broader society. Failure to do so could produce an attitude among globally mobile skilled labor that Canada is no more than a springboard for countries with more welcoming job markets and immigration policies.


1 Zietsma, D. 2007. The Canadian Immigrant Labour Market in 2006: First Results from Canada’s Labour Force Survey. Statistics Canada. P. 6

2 Reitz, P. (2005) “Tapping Immigrants’ Skills: New Directions for Canadian Immigration Policy in the Knowledge Economy”, IRPP, Vol. 11. No.1, February.

3 As cited by The Public Policy Forum, 2004: p.55

4 Teelucksingh, C. and G. Galabuzi (2005). “Working Precariously: The Impact of Race and Immigrant Status on Employment Opportunities and Outcome in Canada”. The Canadian Race Relations Foundation, May, pp.1-38.

5 A Census category defining somebody whose skin color is not white. As relates to immigrant populations, this includes almost all groups except Europeans, Americans and Australians/New Zealanders.

6 Alboim, N. and R. Finnie, R. Meng (2005). “The Discounting of Immigrants’ Skills in Canada: Evidence and Policy Recommendations.” IRPP Choices, Vol. 11, no.2, February.

7 As the visible minority population is younger on average than the overall population, this age cohort was chosen. The figures relate to individuals between the ages of 35 and 44 with a university certificate, diploma or degree.

8 Thompson, Elizabeth. May 26, 2008. “Immigration Policies Boosting Number of Degree Holders in Canada: Study”

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Posted in Americas, Skilled Immigrants & Workforce Integration