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Chronic Low Income and Low-income Dynamics Among Recent Immigrants

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  • Picot, Garnett Hou, Feng Coulombe, Simon
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    Abstract

    The deteriorating economic outcomes among immigrants entering during the 1980s and 1990s have prompted much public concern and policy debate. In 1993, immigrant selection procedures were further modified to increase immigrants' educational attainment and the share of immigrants in the "skilled" economic class. By 2000, dramatic increases in the educational attainment of entering immigrants and the share in the skilled class were observed. In the face of these and other changes, this research focuses on three issues: (1) whether entering immigrants economic outcomes improved after 2000 (the last date for which we have such information from the census), (2) low-income dynamics among successive cohorts of entering immigrants, including changes in the entry and exit probabilities, and the extent of "chronic" low income among successive cohorts, and, (3) whether rising educational attainment and increasing share in the "skilled" class resulted in improvements in economic outcomes as measured by poverty entry, exit and chronic low income. Based on the Longitudinal Administrative Database (LAD) and the Longitudinal Immigration Database (IMDB) data, we find that low-income rates among recent immigrants deteriorated after 2000. Low-income rates of immigrants during their first full year in Canada reached 3.5 times that of the Canadian born in 2002 and fell to 3.2 times in 2004. These rates were higher than at any time during the 1990s (at around 3.0). However, this rise in low income was concentrated among immigrants who had entered very recently (in Canada one or two years), suggesting an increase in the short-term adjustment problem in the 2000s as compared to the 1990s. The downturn in the technology sector after 2000 might be a partial explanation, as the share of entering immigrants in information technology (IT) and engineering occupations rose dramatically over the 1990s. Among immigrants entering Canada during the 1990

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    Bibliographic Info

    Paper provided by Statistics Canada, Analytical Studies Branch in its series Analytical Studies Branch Research Paper Series with number 2007294e.

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    Date of creation: 30 Jan 2007
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    Handle: RePEc:stc:stcp3e:2007294e

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    Related research

    Keywords: Ethnic diversity and immigration; Education; training and learning; Income; pensions; spending and wealth; Integration of newcomers; Outcomes of education; Low income and inequality;

    This paper has been announced in the following NEP Reports:

    References

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    1. David E. Bloom & Morley Gunderson, 1989. "An Analysis of the Earnings of Canadian Immigrants," NBER Working Papers 3035, National Bureau of Economic Research, Inc.
    2. Michael G. Abbott & Charles M. Beach, 1993. "Immigrant Earnings Differentials and Birth-Year Effects for Men in Canada: Post-war-1972," Canadian Journal of Economics, Canadian Economics Association, vol. 26(3), pages 505-24, August.
    3. Frenette, Marc Morissette, Rene, 2003. "Will They Ever Converge? Earnings of Immigrants and Canadian-born Workers over the Last Two Decades," Analytical Studies Branch Research Paper Series 2003215e, Statistics Canada, Analytical Studies Branch.
    4. 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.
    5. 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.
    6. Chiswick, Barry R, 1978. "The Effect of Americanization on the Earnings of Foreign-born Men," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 897-921, October.
    7. Abdurrahman Aydemir & Wen-Hao Chen & Miles Corak, 2009. "Intergenerational Earnings Mobility among the Children of Canadian Immigrants," The Review of Economics and Statistics, MIT Press, vol. 91(2), pages 377-397, May.
    8. Baker, Michael & Benjamin, Dwayne, 1994. "The Performance of Immigrants in the Canadian Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 12(3), pages 369-405, July.
    9. Aydemir, Abdurrahman Skuterud, Mikal, 2004. "Explaining the Deteriorating Entry Earnings of Canada's Immigrant Cohorts: 1966-2000," Analytical Studies Branch Research Paper Series 2004225e, Statistics Canada, Analytical Studies Branch.
    10. David A. Green & Christopher Worswick, 2004. "Immigrant earnings profiles in the presence of human capital investment: measuring cohort and macro effects," IFS Working Papers W04/13, Institute for Fiscal Studies.
    11. David E. Bloom & Morley Gunderson, 1991. "An Analysis of the Earnings of Canadian Immigrants," NBER Chapters, in: Immigration, Trade and the Labor Market, pages 321-342 National Bureau of Economic Research, Inc.
    12. Ana Ferrer & W. Craig Riddell, 2008. "Education, credentials, and immigrant earnings," Canadian Journal of Economics, Canadian Economics Association, vol. 41(1), pages 186-216, February.
    13. Joseph Schaafsma & Arthur Sweetman, 2001. "Immigrant earnings: age at immigration matters," Canadian Journal of Economics, Canadian Economics Association, vol. 34(4), pages 1066-1099, November.
    14. Mary L. Grant, 1999. "Evidence of New Immigrant Assimilation in Canada," Canadian Journal of Economics, Canadian Economics Association, vol. 32(4), pages 930-955, August.
    15. Ross Finnie & Arthur Sweetman, 2003. "Poverty dynamics: empirical evidence for Canada," Canadian Journal of Economics, Canadian Economics Association, vol. 36(2), pages 291-325, May.
    16. Hou, Feng Picot, Garnett, 2003. "The Rise in Low-income Rates Among Immigrants in Canada," Analytical Studies Branch Research Paper Series 2003198e, Statistics Canada, Analytical Studies Branch.
    17. Ana Ferrer & David A. Green & W. Craig Riddell, 2006. "The Effect of Literacy on Immigrant Earnings," Journal of Human Resources, University of Wisconsin Press, vol. 41(2).
    18. John M. Abowd & Richard B. Freeman, 1991. "Immigration, Trade and the Labor Market," NBER Books, National Bureau of Economic Research, Inc, number abow91-1, July.
    19. James Ted McDonald & Christopher Worswick, 1998. "The Earnings of immigrant men in Canada: Job tenure, cohort, and macroeconomic conditions," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 51(3), pages 465-482, April.
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Pakistani-Canadians: Falling below the poverty line
      by Murtaza Haider in eKonometrics on 2012-05-16 16:40:00
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    Cited by:
    1. Beckstead, Desmond Brown, W. Mark Newbold, Bruce, 2008. "Cities and Growth: In Situ Versus Migratory Human Capital Growth," The Canadian Economy in Transition 2008019e, Statistics Canada, Economic Analysis Division.
    2. Schrecker, Ted, 2007. "Intra-metropolitan health disparities in Canada: Studying how and why globalization matters, and what to do about it," Center for Global, International and Regional Studies, Working Paper Series qt3z7544g1, Center for Global, International and Regional Studies, UC Santa Cruz.
    3. Gilles Grenier & Li Xue, 2009. "Duration of Access of Canadian Immigrants to the First Job in Intended Occupation," Working Papers 0908E, University of Ottawa, Department of Economics.
    4. Hou, Feng, 2008. "Immigrants Working with Co-ethnics: Who Are They and How Do They Fare Economically?," Analytical Studies Branch Research Paper Series 2008310e, Statistics Canada, Analytical Studies Branch.
    5. Grady, Patrick, 2008. "Is Canadian Immigration too high? A Labour Market and Productivity Perspective," MPRA Paper 25221, University Library of Munich, Germany.
    6. Houle, Rene Schellenberg, Grant, 2008. "Remittance Behaviours Among Recent Immigrants in Canada," Analytical Studies Branch Research Paper Series 2008312e, Statistics Canada, Analytical Studies Branch.

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