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Initial Earnings and Catch-Up Capacity of Immigrants

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  • Peter S. Li

Abstract

The literature, largely based on cross-sectional census data, has suggested that recent immigrant cohorts to Canada earned less than earlier ones relative to Canadians' earnings. The Longitudinal Immigration Data Base (IMDB) developed by Citizenship and Immigration Canada and Statistics Canada provides rich data for studying immigrants' longitudinal earnings profiles. Using custom-made IMDB tables, this paper estimates the initial earnings gap between immigrants and Canadians, and immigrants' catch-up capacity, defined as the number of years immigrants took, or expected to take, to reach earnings parity with Canadians. The findings show that recent immigrant cohorts earned less initially than earlier ones, but caught up faster. Some tentative explanations and policy implications are offered.

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  • Peter S. Li, 2003. "Initial Earnings and Catch-Up Capacity of Immigrants," Canadian Public Policy, University of Toronto Press, vol. 29(3), pages 319-337, September.
    • Handle: RePEc:cpp:issued:v:29:y:2003:i:3:p:319-337
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    1. James Ted McDonald & Christopher Worswick, 1998. "The Earnings of Immigrant Men in Canada: Job Tenure, Cohort, and Macroeconomic Conditions," ILR Review, Cornell University, ILR School, vol. 51(3), pages 465-482, April.
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    4. George J. Borjas, 2021. "Assimilation, Changes in Cohort Quality, and the Earnings of Immigrants," World Scientific Book Chapters, in: Foundational Essays in Immigration Economics, chapter 2, pages 3-29, World Scientific Publishing Co. Pte. Ltd..
    5. Chiswick, Barry R, 1977. "Sons of Immigrants: Are They at an Earnings Disadvantage?," American Economic Review, American Economic Association, vol. 67(1), pages 376-380, February.
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    Cited by:

    1. Abbott, Michael G. & Beach, Charles M., 2011. "Immigrant Earnings Differences Across Admission Categories and Landing Cohorts in Canada," CLSSRN working papers clsrn_admin-2011-20, Vancouver School of Economics, revised 21 Aug 2011.
    2. Sweetman, Arthur & Warman, Casey, 2009. "Temporary Foreign Workers and Former International Students as a Source of Permanent Immigration," CLSSRN working papers clsrn_admin-2009-34, Vancouver School of Economics, revised 22 Jun 2009.
    3. Neeraj Kaushal & Yao Lu & Nicole Denier & Julia Shu-Huah Wang & Stephen J. Trejo, 2016. "Immigrant employment and earnings growth in Canada and the USA: evidence from longitudinal data," Journal of Population Economics, Springer;European Society for Population Economics, vol. 29(4), pages 1249-1277, October.
    4. Banerjee, Rupa & Verma, Anil, 2009. "Determinants and Effects of Post-Migration Education Among New Immigrants in Canada," CLSSRN working papers clsrn_admin-2009-20, Vancouver School of Economics, revised 11 Mar 2009.
    5. Abdurrahman Aydemir, 2013. "Skill-based immigrant selection and labor market outcomes by visa category," Chapters, in: Amelie F. Constant & Klaus F. Zimmermann (ed.), International Handbook on the Economics of Migration, chapter 23, pages 432-452, Edward Elgar Publishing.
    6. Jackie M. L. Chan, 2014. "Assimilation of Hong Kong Immigrants in Canada," Pacific Economic Review, Wiley Blackwell, vol. 19(4), pages 439-465, October.
    7. Krishna Pendakur & Ravi Pendakur, 2015. "The Colour of Money Redux: Immigrant/Ethnic Earnings Disparity in Canada 1991– 2006," Discussion Papers dp15-13, Department of Economics, Simon Fraser University.
    8. Kristyn Frank & Kelli Phythian & David Walters & Paul Anisef, 2013. "Understanding the Economic Integration of Immigrants: A Wage Decomposition of the Earnings Disparities between Native-Born Canadians and Recent Immigrant Cohorts," Social Sciences, MDPI, vol. 2(2), pages 1-22, April.
    9. Michael Haan, 2008. "The Place of Place: Location and Immigrant Economic Well-being in Canada," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 27(6), pages 751-771, December.
    10. Patrik Marier & Suzanne Skinner, 2008. "The Impact of Gender and Immigration on Pension Outcomes in Canada," Canadian Public Policy, University of Toronto Press, vol. 34(s1), pages 59-78, November.
    11. Kristyn Frank, 2013. "Immigrant Employment Success in C anada: Examining the Rate of Obtaining a Job Match," International Migration Review, Wiley Blackwell, vol. 47(1), pages 76-105, March.
    12. Rupa Banerjee, 2008. "An Examination of Factors Affecting Perception of Workplace Discrimination," Journal of Labor Research, Springer, vol. 29(4), pages 380-401, December.
    13. Feng Hou & Yuqian Lu, 2017. "International students, immigration and earnings growth: the effect of a pre-immigration host-country university education," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 7(1), pages 1-24, December.
    14. Tondji, Jean-Baptiste, 2015. "Wage of Immigrants in the Canadian Labour Market," MPRA Paper 80783, University Library of Munich, Germany.
    15. Hou, Feng & Picot, Garnett & Coulombe, Simon, 2007. "Le faible revenu chronique et la dynamique du faible revenu chez les nouveaux immigrants," Direction des études analytiques : documents de recherche 2007294f, Statistics Canada, Direction des études analytiques.
    16. Picot, Garnett & Sweetman, Arthur, 2005. "The Deteriorating Economic Welfare of Immigrants and Possible Causes: Update 2005," Analytical Studies Branch Research Paper Series 2005262e, Statistics Canada, Analytical Studies Branch.
    17. Hou, Feng & Picot, Garnett & Coulombe, Simon, 2007. "Chronic Low Income and Low-income Dynamics Among Recent Immigrants," Analytical Studies Branch Research Paper Series 2007294e, Statistics Canada, Analytical Studies Branch.
    18. Hou, Feng & Picot, Garnett, 2009. "The Effect of Immigrant Selection and the IT Bust on the Entry Earnings of Immigrants," CLSSRN working papers clsrn_admin-2009-37, Vancouver School of Economics, revised 26 Jun 2009.
    19. Eric Fong & Pui Kwan Man, 2023. "Income Differences of Chinese Sub-ethnic Groups in Canada," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 42(2), pages 1-27, April.
    20. Hou, Feng, 2010. "Entry Earnings of Canada’s Immigrants over the Past Quarter Century: the Roles of Changing Characteristics and Returns to Skills," CLSSRN working papers clsrn_admin-2010-23, Vancouver School of Economics, revised 22 Jun 2010.

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