A new Desjardins report says Canada’s Prairie provinces got the biggest bang for their immigration buck in recent years and are poised to see GDP boosts of more than half a percentage point by retaining even more immigrants in the future.
“Alberta, Saskatchewan, and Manitoba would experience more significant 0.3 to 0.6 percentage point boosts to GDP growth if their stronger economic conditions and better affordability attract a higher share of newcomers in the next few years,” wrote Desjardins principal economist Marc Desormeaux.
Desormeaux argues that the provinces get the biggest benefit from immigration when their immigration intake is large enough to a share of the existing population and those immigrants can successfully integrate into the labour market.
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“Immigrants’ outsized role in Canada’s pre-pandemic expansion is clear,” noted Desormeaux. “From 2015 to 2019, immigrants accounted for over 70 per cent of Canadian employment gains, despite making up only about a quarter of the population aged 15 years or older.
“During that time, net new positions among immigrants outpaced those of Canadian-born workers in every single province. By 2019, employment rates for new immigrants had also outpaced those of the population born in Canada in nearly every province. This unfolded as a range of federal and provincial programs were put in place to improve newcomers’ labour market integration.
After the COVID-19 pandemic, the economic contribution of immigrants has only grown.
“New immigrants experienced surges in employment and participation rates across the provinces in 2021 and 2022,” wrote Desormeaux. “That, in turn, helped narrow the gap between the unemployment rate of new immigrants and that of Canadian-born workers.
“From 2020 to 2022, immigrants landed within the last five years accounted for more net new employment than the Canadian-born population nationally and in half the provinces. That is despite the fact that the former group was less than five per cent the size of the latter group in that time.”
Immigration trends show that not only are immigrants to Canada very likely land jobs and do well in their adopted country but that their children are also likely to outperform Canadians in earning power over the course of their lifetimes.
Although the data shows immigrants who came to Canada as children grew up to earn less than other Canadians in their early 20s, that same research also reveals those children then caught up and surpassed their Canadian-born counterparts to earn more than them by the time they hit their 30s.
In its Economic Outcomes of Taxfiling Immigrants Admitted as Children Compare to Canadian Taxpayers by Age at Taxation in 2020 report, Statistics Canada documents the extra earning power of immigrants who arrived in Canada as children by the time they reach 30 years of age.
Children Of Immigrants Out-Earn Canadian-Born Workers By The Time They Hit 30 Years Of Age
That data shows immigrants earned a median annual income of only $8,400, or almost a third less, 29.4 per cent, compared to the annual median income of $11,900 for all those who filed income tax reports in 2020. And immigrants continued to earn less on average than Canadians well into their 20s.
Then, at age 26, the data shows immigrants suddenly start earning more than their fellow Canadians. By the age of 30, the data shows immigrants out-earning their fellow Canadians by almost 8.6 per cent with immigrants raking in a medium annual income of $50,200 compared to the $46,230 median annual income of Canadians as a whole.
The reason for the income disparities between immigrants and other Canadians is attributable to their greater education. Immigrant families encourage their children to pursue more education and graduate more often with advanced degrees.
At every age, significantly more immigrant taxpayers reported post-secondary tuition fees than did the average Canadian.
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By the time they hit 25 years of age – at which point most university students are in post-graduate programs – more than a third of immigrant taxpayers, 33.7 per cent, reported post-secondary tuition fees on their income tax reports compared to barely over a quarter, 27.2 per cent, of all Canadians.
With that greater education and more advanced degrees, immigrants are often able to land better-paying jobs.
Another Statistics Canada report provides further detail on that trend. In its Socioeconomic Outcomes Of Immigrants Admitted To Canada As Children, 2019 released last year, the statistical and demographic services agency also noted the children of economic immigrants to Canada earned less than the average Canadian worker, 15.5 per cent less at age 20, because they were more likely to be attending classes.
“At age 20, immigrants who were admitted as children had lower median wages, $10,900, than the overall Canadian population of $12,900,” notes the report. “This is associated with the immigrants’ higher post-secondary education participation.”
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The authors of that Statistics Canada report suggested the reason so many more economic immigrants’ children attend university or college is because of the criteria used in the Comprehensive Ranking System (CRS) to select those applicants most likely to succeed in Canada.
“Canada’s selection process for economic principal applicants heavily emphasizes their education, skills and work experience,” noted Statistics Canada. “As a result, the majority of immigrant taxpayers admitted under this category have completed some post-secondary education at the time of their admission.”
Since their parents tend to have more education, the children of these economic immigrants tend to follow in their parents’ footsteps and also go for higher education.
“Immigrants admitted as children of economic immigrant families have much higher post-secondary education participation than their counterparts admitted through other immigration categories, particularly during early adulthood,” noted Statistics Canada.
“In 2019, 75.4 per cent of 20-year-old immigrants admitted as children of economic immigrant families participated in postsecondary education.”