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The Canadian Labour Market

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The Canadian Labour Market

Category: Research Paper

Subcategory: Economics

Level: Academic

Pages: 9

Words: 2475

The Canadian Labour Market
Institutional Affiliation:

The Canadian Labour Market
The aging population in Canada is increasing, and this has created a gap in the labour market. As such, immigrants tend to fill the gap that is created. Further, the number of immigrants taking up positions in Canada’s labor market is expected to continue rising. However, while immigrants play an important role in driving the Canadian labor market, it is still not clear whether immigrants are contented with their jobs compared to Canadian-born workers and earlier immigrant cohorts. The immigrants are usually driven by the need to help their families back home. The paper examines the performance of immigrants in the Canadian labour market, the effects of higher education, age, work experience and changes in income and economic mobility of immigrants. Issues of self-employment and the integration of women and children are also discussed.
Immigrants in the Canadian Labour market
The Immigration and Refugee Protection Act (IRPA) has a mandate of supporting the Canadian economy. The immigration program achieves this objective by increasingly attracting new comers who are immigrants from other nations and ensure their comfort. Currently, there is an indication that the new immigrants to Canada will play a vital role in combating the demographic challenges that are witnessed in the region. The nation is facing an acute number of workers from domestic sources and high rates of retirement (Feng & Wang, 2011).
The role of the Canadian-born members is also not discounted even though the immigrants have played a greater role in the provision of labour sources. It is currently evident that the immigrants are more in population and in the labour force, an indication of their importance in the region. However, historically, the labour force of the Canadian-born citizens outweighed the achievements from the immigrants, and such a trend is expected to continue.
In addition, permanent residents who usually go to Canada, often receive work permits which allow them to fully operate in the region’s work force (Houle & Lahouaria, 2010). Their provision to the economy to the nation is always viewed as being temporary and viewed as a response to globalization and the desires of employers. The immigration programs in Canada are not able to tackle the challenges of the labour market in Canada, hence the need to increase the number of immigrants to assist in increasing workers in various industries and regions as a whole.
Composition of the Canadian labour force
The labour force in Canada comprises of the non-institutional number of people who are 15 years, who are either employed or out of employment. The total number of the labour force was 18.7 in the year 2011 where the Canadian-born population occupied a large percentage of 77.1% while the immigrants were 14.4 million, and this accounted for 21.2%. The remaining population which accounted for 1.7% was non-landed immigrants (Statistics Canada, 2012). The non-landed immigrants included students from foreign regions and refugees who had work permits. The composition of the work force in Canada is indicated below.

Recent labour conditions and unemployment
The economic challenges in the world have had an adverse effect on the economy of Canada. Structural changes in the USA, which is a major partner in trading in Canada, have had an adverse effect of the labour force in the region. The unemployment and employment rates in Canada show that the slowdown in the economic condition of the region was not detrimental as that which was witnessed between 1981 and 1990. Statistics Canada (2012) confirms that the employment rates by the year 2008 stood at 63.9%, and January was seen as the trough with the rate of unemployment being 5.8% as shown below.

There was deterioration in the labour force after the 1981 recession, and this led to a rise in the levels of unemployment. The rate of employment declined by a small margin of 3% after the recession, and this was followed by a quick recovery of the economy after the next one year. Longer periods of the labour market will not be affected by the recent recession of between 2008 and 2009. However, aging will be a factor that will result in shortened labour needs in future because of limited experience in the region (Statistics Canada, 2012). The Canadian unemployment rate is indicated below.

Retirements in Canada have been seen as affecting the regions labour market. The rates of retirement have not been measured clearly, but there is evidence that they will continue to occur in future at higher rates, hence the need for more workers in the labour force (Palameta, 2007). The older participation in the labour market is shown below.

Age and Education
There will be a total number of 6.4 million jobs that will be created in future due to retirement and job creation capabilities after the increased participation of the economy. Most of these jobs will be filled by the Canadian-born population, new immigrants and other nationals from other countries who have been given temporary working permits. The aging population will have a greater impact on the labour market as more people are living active service due to their age. However, the large aging population which includes members who are 55 years and above have been few in the labour market in recent years. The labour force will, therefore, increase in future by 0.8% every year, and this is a representation of half the growth rate of 1.6% which was seen the year 2000 (Statistics Canada, 2012).
Students leaving the system in Canada are majorly the main source of labour in the region. This comprises all those who have high school certificates to Ph.D. levels. They will represent the new labour force which will stand at a high level of 4.7 million in the coming years. The number of immigrants to the region will be relatively low compared to the school leavers who are seen to occupy most positions in the labour force in Canada. Immigrants, who enter the labour market in Canada, come to the region due to the age levels in the region, source country and the general mix of other immigrants. Their presence will increase the labour force although their numbers will be minimal compared to the Canadian-born population (Ferrer & Riddell, 2008).
While higher achievements in education play an important role in ensuring that individuals can secure better employment opportunities, this might not be the case for immigrants in Canada. In the early 90s, the government implemented a policy that was geared at increasing the population of skilled immigrants with high educational qualifications. However, research on the same has shown that high education qualifications do not guarantee a better pay for immigrants. An important factor to note also is that while there are more immigrants with degree certificates, but this does not reflect in the job market (Frank and Feng, 2015).
The immigrants tend to have more university graduates compared to the Canadian-born workers. This shows that higher education does not provide protection for immigrants in terms of earning more in the Canadian labor market. On the other hand, immigrants who arrived in the country recently, and with high qualifications earn less compared to earlier immigrant cohorts. For example, those who are experiencing lower rates of earnings tend to come from developing regions such as Africa and some parts of Asia. The Canadian-born workers with lesser qualifications tend to have more opportunities compared to the immigrants (Ferrer & Riddell, 2008).
Work Experience
The number of people in the Canadian Experience Class is relatively low and stands at 2.4% of the total number of permanent residents. The category is mandated to have skilled and talented workers who have shown their ability to integrate easily into the Canadian labour force and society with ease. The CEC allows few foreign workers and students who have graduated, such as those with experience in technical, managerial and professional fields to have permanent residence, and later become Canadian citizens. It is vital to note that individuals who spend some time in Canada before landing often have a higher economic value compared to those who are new (Statistics Canada, 2012).
Income and economic mobility of foreign immigrants in Canada, self-employment and the economic integration of women and children
Canada has the largest number of inflows of permanent residents among other nations from the OECD. Despite the relatively high rates of immigration inflows in the region, the region has an equality system when it comes to rates of employment between immigrants and the Canadian-born population. The overall disparity rates between the immigrants and the Canadian-born females is low in the country, and the difference between their male counterparts is negligible. However, immigrants often find various challenges when integrating into the labour market in Canada.
The earnings disparity among immigrants who entered the region recently and the Canadian born in the first quarter of the year 2000 increased substantially. In 1980, men who were in the labour force earned 85 cents for every dollar that was received by their counterparts. This ration went down to 67 cents in the year 2000 and later to 63 cents in the year 2005. The ratios for women stood at 85, 65 and 56 respectively (Statistics Canada, 2012).
Employment earning in Canada among entry cohorts has had two trends since time immemorial. The earnings of individuals increase with time while in the region and earnings of principal applicants are often higher compared to those of other immigrants. The latter group has a higher participation level on the labour force and often selected first as shown below.

Canada is known to be in the class of “A” in terms of the international income mobility and positioned at number four among other thirteen nations. This indicates the measure of equality when looking for opportunities, and their improved income mobility has been seen as a measure to increase their economic efficiency. The income mobility of Canada and other nations is indicated below.

Income mobility involves the change of income over a period of time among generations. Canada’s income mobility is better when compared to those of other nations. The relationship between a family’s background and the income of individuals when old is low. The disadvantage that is passed down the family lane in Canada is relatively low and stands at 19%.The economic profile of immigrant women and children in Canada is affected by different policies and gender disparity that is common in the region. Canadian-born women earn relatively more and have better living conditions as opposed to their immigrant counterparts. Children are not allowed to work unless they reach a certain age limit (Houle & Lahouaria, 2010)
While previous studies have focused on the low earnings of immigrants in Canada, there are also challenges related to the integration of immigrants. Previous studies that took into account the education levels found that young women whose parents are immigrants appeared to have lower earnings compared to their Canadian-born counterparts. There was no significant evidence to support earnings advantage among young men. Geographical distribution has also been pointed out as a contributing factor to the better wages received by women.
Conversely, women whose parents are Canadian and live in disadvantaged regions of the country tend to have lower earnings. Better earnings are only found within women immigrants who come from well-developed regions in Canada. Immigrants experience in the labor market tends to differ depending on gender. For instance, a finding that is consistent in literature is the lower earnings of immigrant women compared to their male counterparts. The unemployment rate among immigrant women in the country also appears to be higher thus creating “double jeopardy” (Ferrer & Riddell, 2008).
However, the economic prospects of immigrant women seem to get better with time. The employment rate of immigrant women who move to Canada as spouses is low. Most women who move as spouses to Canada go for temporary employment due to the flexibility of such jobs. As such, they are in a position to balance work and other family responsibilities such as taking care of their children. Conversely, women who are in permanent employment are also likely to move to temporary work to increase their earnings (Frank & Feng, 2015).
Some of the challenges that immigrant women in Canada face with regard to economic security include the inability to afford childcare, inadequate housing, language barrier and lack of support networks. These challenges contribute to an increase in poverty levels particularly among immigrant women (Palameta, 2007). Living with low income in Canada makes it difficult for immigrant women to afford basic needs such as housing. As such, most immigrant women and children often find themselves living in houses that require major repairs. Such houses are often too small to accommodate immigrant women and their children.
In the country, the population of families who live in core housing continues to increase. Further, immigrant families are more likely to find themselves in core housing compared to non-immigrant families. Most of the immigrant families also spend a large amount of their income on rent. These families often face challenges in terms of providing better education, food and health care for their children. However, the government has a program where immigrants who cannot afford house rent are placed in public housing.
The only problem is that public housing in the country is considered to be unsafe. In case of an emergency situation, the government can place struggling families in shelters or hostel. With regard to support networks, women who have low income tend to encounter a lack of community support. Most immigrant women require a number of support systems to address problems such as social isolation or domestic violence. In addition, immigrant women also require programs that can assist them to understand the workplace environment (Frank & Feng, 2015).
The desire to become self-employed by Canadian workers has also given the opportunity for immigrants to get jobs easily. Other immigrants also work in businesses operated by the Canadian community and often paid relatively low. Other immigrants currently own businesses, and this has been necessitated by the low-level opportunities available in the market.
Compared to Canadian-born workers, immigrant workers in Canada are not doing well, and this is evident in their earnings. In addition, their educational qualifications have no influence on the type of job they get. However, immigrants who have lived in the country for longer period appear to be doing well compared to recent immigrants. As a country that relies on immigrants to drive economic development, it is necessary for the policymakers to improve the working conditions of the immigrants particularly those with higher levels of education.
There is a need for further research to identify the causes of poverty among recent immigrants. Concerning job satisfaction, the Canadian-born workers seem to have a higher job satisfaction compared to immigrant workers. Further, earlier immigrant cohorts tend to have a higher job satisfaction compared to Canadian-born workers and late immigrant cohorts. Conversely, research has also shown that there are types of work that contribute to job satisfaction. For instance, working in offices as opposed to menial jobs contributes to job satisfaction because of the high pay that is associated with such jobs. Also, job promotion and other rewards also contribute to job satisfaction. Immigrants have also benefited from in-house training, and this has a positive impact on job satisfaction. Immigrants in the country have also benefited from motivation-based practices as they have a significant impact on their job satisfaction (Ferrer & Riddell, 2008).

Feng, H., & Wang, S. (2011). Immigrants in self-employment.Perspectives on Labour and
Income, Vol. 23(No. 3). Retrieved February 10, 2015, from http://www .statcan.gc.ca/pub/75-001-x/2011003/article/11500-eng.pdf
Frank, K., & Feng, H. (2015). Source-country Female Labour Force Participation and the Wages
of Immigrant Women in Canada. Analytical Studies Branch Research Paper Series, Vol. 365. Retrieved February 10, 2015, from http://www .statcan.gc. ca/pub/ 11f0019m /11f0019m2015365-eng.pdf
Houle, R., & Lahouaria, Y. (2010). Recognition of newcomers’ foreign credentials and work
experience. Perspectives on Labour and Income, Vol. 11(No. 9), 18-33. Retrieved February 10, 2015, from http://www.statcan.gc.ca/pub/75-001-x/75-001-x2010109-eng.pdf
Ferrer, A., & Riddell, W. (2008).Education, credentials, and immigrant earnings. Canadian
Journal of Economics/Revue CanadienneD’économique, 41(1), 186-216.
Labour Force Survey. (2014). Annual levels of immigration and immigrant entry earnings in
Canada. Canadian Public Policy, 40(2), 166-181.
Longitudinal Immigration Database. (2012). Effects of immigration on house prices in Canada.
Applied Economics, 44(13), 1645-1658.
Palameta, B. (2007). Economic integration of immigrants’ children.Perspectives on Labour and
Income, Vol. 8(No. 10). Retrieved February 10, 2015, from http://www.statcan.gc.ca/cgi-bin/af-fdr.cgi?l=eng&loc=/pub/75-001-x/75-001-x2007110-eng.pdf
Statistics Canada. (2012.) Income and mobility of immigrants.The Daily. January 12.
http://www.statcan.gc.ca/daily-quotidien/150112/dq150112a-eng.pdf (accessed February 10, 2015)

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