Abstract
This study assesses whether characteristics relating to ethnic identity and social inclusion influence the earnings of recent immigrants in Canada. Past research has revealed that relevant predictors of immigrant earnings include structural and demographic characteristics, educational credentials and employment-related characteristics. However, due to the unavailability of situational and agency variables in existing surveys, past research has generally been unable to account for the impact of such characteristics on the economic integration of immigrants. Drawing on data from Statistics Canada's Ethnic Diversity Survey, this paper builds on previous research by identifying the relative extent to which sociodemographic, educational and ethnic identity characteristics explain earnings differences between immigrants of two recent cohorts and native-born Canadians. The results indicate that immigrants are disadvantaged in the labor market in terms of characteristics relating to sociodemographics and ethnic identity, but are advantaged in terms of human capital.
Highlights
Factors associated with the discrepancy in earnings between the Canadian- and the foreign-born are empirically well-documented and include social and situational characteristics, educational credentials and the amount of time spent in the host country [1]
The earnings gap between recent immigrants and the native-born in industrialized nations is an issue of great interest among economists, demographers and sociologists
As immigration has become increasingly important to population growth and economic development, the wage gap between immigrants and non-immigrants is an important policy issue in Canada, carrying with it implications for the wellbeing of a growing number of people
Summary
Factors associated with the discrepancy in earnings between the Canadian- and the foreign-born are empirically well-documented and include social and situational (i.e., sociodemographic) characteristics, educational credentials and the amount of time spent in the host country [1]. A substantial earnings disadvantage has been documented for several European countries, including Sweden [3,4], Australia [5], Denmark and Germany [6]. Much of this literature is largely based on cross-sectional census data, and the recent use of the Longitudinal. The influence of immigrants’ lack of understanding of cultural norms in Canada, those relating to the labor market, is cited by some as an explanation of why more recent cohorts of immigrants integrate into the Canadian economy at slower rates than previous cohorts (e.g., [11])
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