Earnings of one-step and two-step economic immigrants: Comparisons from the arrival year

Since the early 2000s, the two-step immigration selection process, through which economic immigrants are chosen from the pool of temporary foreign workers, has expanded rapidly. Previous research indicated that following their landing, high-skilled two-step immigrants had higher earnings than comparable one-step immigrants—those directly selected from abroad. However, an important question that has not been fully examined is whether the earnings advantage of two-step immigrants over one-step immigrants persisted if the two groups were compared from their arrival year rather than the year when they became permanent residents. At that point, neither group possessed any Canadian work experience, eliminating its potential influence on their earnings differences. The results of this study reveal that two-step immigrants consistently had higher annual earnings than their one-step counterparts within the same admission class when the comparison started from their initial arrival year. These earnings differences, although reduced, remained substantial after accounting for sociodemographic differences between the two groups and after 10 years following the initial arrival. Furthermore, these patterns generally held across successive arrival cohorts. The conclusion includes a discussion of the implications of these findings and explores potential reasons for these outcomes.