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Why do immigrant workers in Australia perform better than those in Canada? Is it the immigrants or their labour markets?

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  • Andrew Clarke
  • Mikal Skuterud

Abstract

Research comparing the labour market performance of recent cohorts of immigrants to Australia and Canada points to superior employment and earnings outcomes in Australia. Examining Australian and Canadian Census data between 1986 and 2006, we find that this performance advantage is not driven by differences in broader labour market conditions affecting all new labour market entrants. Rather, the results from comparing immigrants from a common source country – either the U.K., India, or China – suggest that Australian immigrants perform better, particularly in average earnings, primarily because of a different source country distribution. Moreover, the recent tightening of Australian selection policy, most notably its use of mandatory pre‐migration English‐language testing, appears to be having an effect, primarily by further shifting the source country distribution of immigrants away from non‐English‐speaking source countries, rather than in identifying higher‐quality migrants within source countries. Pourquoi est‐ce que les travailleurs immigrants en Australie s'en tirent mieux que ceux qui choisissent le Canada? Problème d'immigrants ou de marchés du travail? Les recherches comparant la performance des récentes cohortes d'immigrants sur le marché du travail en Australie et au Canada suggèrent des résultats supérieurs en Australie tant pour ce qui est des niveaux d'emploi que pour les niveaux de gains d'emploi. Examinant les données de recensements au Canada et en Australie entre 1986 et 2006, on découvre que cet avantage au niveau de la performance n'est pas attribuable à des différences dans les conditions générales du marché du travail affectant tous les nouveaux entrants sur le marché du travail. C'est plutôt qu'en comparant les immigrants d'une source commune d'immigrants ‐ U.K., Indes, ou Chine ‐ les résultats suggèrent que les immigrants en Australie s'en tirent mieux, en particulier pour ce qui est des gains moyens, surtout à cause de la répartition différente des pays d'origine. De plus, le resserrement récent de la politique de sélection australienne (en particulier son utilisation d'un test obligatoire de connaissance de l'anglais avant l'immigration) semble avoir eu pour effet de déplacer la répartition de la source des immigrants de manière à diminuer l'immigration en provenance de pays où on ne parle pas l'anglais, plutôt que d'identifier des immigrants potentiels de plus haute qualité dans les divers pays d'origine.

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  • Andrew Clarke & Mikal Skuterud, 2013. "Why do immigrant workers in Australia perform better than those in Canada? Is it the immigrants or their labour markets?," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 46(4), pages 1431-1462, November.
    • Handle: RePEc:wly:canjec:v:46:y:2013:i:4:p:1431-1462
    DOI: 10.1111/caje.12059
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    Cited by:

    1. Joxhe, Majlinda & Scaramozzino, Pasquale & Zanaj, Skerdilajda, 2021. "Fiscal Position of Immigrants in Europe: A Quantile Regression Approach," GLO Discussion Paper Series 758, Global Labor Organization (GLO).
    2. Jeff Borland & Michael Coelli, 2016. "Labour Market Inequality in Australia," The Economic Record, The Economic Society of Australia, vol. 92(299), pages 517-547, December.
    3. David A. Green & Christopher Worswick, 2017. "Canadian economics research on immigration through the lens of theories of justice," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 50(5), pages 1262-1303, December.
    4. Nguyen, Ha Trong & Duncan, Alan S, 2017. "Exchange rate fluctuations and immigrants' labour market outcomes: New evidence from Australian household panel data," Journal of International Economics, Elsevier, vol. 105(C), pages 174-186.
    5. Blit, Joel & Skuterud, Mikal & Zhang, Jue, 2017. "Immigration and innovation: Evidence from Canadian cities," CLEF Working Paper Series 12, Canadian Labour Economics Forum (CLEF), University of Waterloo.
    6. Holger Hinte, 2014. "What determines the net fiscal effects of migration?," IZA World of Labor, Institute of Labor Economics (IZA), pages 1-78, June.
    7. Andrew Clarke & Ana Ferrer & Mikal Skuterud, 2019. "A Comparative Analysis of the Labor Market Performance of University-Educated Immigrants in Australia, Canada, and the United States: Does Policy Matter?," Journal of Labor Economics, University of Chicago Press, vol. 37(S2), pages 443-490.
    8. Şerife Genç İleri, 2019. "Selective immigration policy and its impacts on Canada's native‐born population: A general equilibrium analysis," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 52(3), pages 954-992, August.
    9. Samuel Vézina & Alain Bélanger, 2020. "Literacy Skills as an Explanation for Labor Market Imbalances by Occupational Type in Canada: Microsimulation Projections for 2014–2024," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 39(6), pages 1019-1049, December.
    10. Majlinda Joxhe & Pasquale Scaramozzino & Skerdilajda Zanaj, 2024. "The Public Finance Position of Immigrants in Europe: A Quantile Regression Approach," Public Finance Review, , vol. 52(2), pages 182-221, March.
    11. Manish Pandey & James Townsend, 2017. "Prior host-country work experience and immigrant labor market outcomes: evidence from Canada," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 6(1), pages 1-22, December.
    12. Joel Blit & Mikal Skuterud & Jue Zhang, "undated". "The impact of patent protection on R&D. Evidence using export markets," Working Papers 17011, University of Waterloo, Department of Economics.
    13. Ha Trong Nguyen & Alan Duncan, 2015. "Macroeconomic Fluctuations in Home Countries and Immigrants’ Wellbeing: New Evidence from Down Under," Bankwest Curtin Economics Centre Working Paper series WP1502, Bankwest Curtin Economics Centre (BCEC), Curtin Business School.
    14. Ana Ferrer & Mikal Skuterud & Andrew Clarke, 2018. "A Comparative Analysis of the Labour Market Performance of University-Educated Immigrants in Australia, Canada, and the United States," Working Papers 1807, University of Waterloo, Department of Economics, revised 02 Jan 2018.
    15. Andrew Clarke & Mikal Skuterud, 2016. "A comparative analysis of immigrant skills and their utilization in Australia, Canada, and the USA," Journal of Population Economics, Springer;European Society for Population Economics, vol. 29(3), pages 849-882, July.
    16. Doyle, Matthew & Skuterud, Mikal & Worswick, Christopher, 2023. "The economics of Canadian immigration levels," CLEF Working Paper Series 58, Canadian Labour Economics Forum (CLEF), University of Waterloo.

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    More about this item

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

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