Public and Private Sector Earnings of Immigrants and the Canadian-Born: Evidence from the Labour Force Survey

Abstract

Using Statistics Canada’s monthly Labour Force Survey master files from January 2006 to December 2018, this paper evaluates the wage differences between immigrants and comparable Canadian-born workers both within the respective levels of the private and public sectors, as well as the public sector wage premium within the immigrant and Canadian-born populations. Using both Ordinary Least Squares and Oaxaca-Blinder decomposition techniques, we find that the immigrant wage gap tends to be negative and is largest in the private sector. The public-sector premium relative to the private sector is also larger for immigrants that for the Canadian-born when we compare wage differences within the two groups. Combined, these results suggest that public sector wages are important to narrowing the overall immigrant wage gap.