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Why do Immigrant Workers in Australia Perform Better than in Canada? Is it the Immigrants or their Labour Markets?

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  • Clarke, Andrew
  • Skuterud, Mikal

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 structural and macroeconomic labour market conditions affecting all new labour market entrants. Rather, the results from comparing immigrants from a common source country { either the UK, India, or China { suggest that the advantage, particularly in earnings, primarily reflects a difference in the source country distribution of Australian immigrants. 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.

Suggested Citation

  • Clarke, Andrew & Skuterud, Mikal, 2012. "Why do Immigrant Workers in Australia Perform Better than in Canada? Is it the Immigrants or their Labour Markets?," CLSSRN working papers clsrn_admin-2012-10, Vancouver School of Economics, revised 31 Mar 2012.
    • Handle: RePEc:ubc:clssrn:clsrn_admin-2012-10
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    File URL: http://www.clsrn.econ.ubc.ca/workingpapers/CLSRN%20Working%20Paper%20no.%2096%20-%20Clarke%20and%20Skuterud.pdf
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    References listed on IDEAS

    as
    1. Deborah A. Cobb-Clark, 2003. "Public policy and the labor market adjustment of new immigrants to Australia," Journal of Population Economics, Springer;European Society for Population Economics, vol. 16(4), pages 655-681, November.
    2. Christian Dustmann & Francesca Fabbri, 2003. "Language proficiency and labour market performance of immigrants in the UK," Economic Journal, Royal Economic Society, vol. 113(489), pages 695-717, July.
    3. Hoyt Bleakley & Aimee Chin, 2004. "Language Skills and Earnings: Evidence from Childhood Immigrants," The Review of Economics and Statistics, MIT Press, vol. 86(2), pages 481-496, May.
    4. David E. Bloom & Gilles Grenier & Morley Gunderson, 1995. "The Changing Labour Market Position of Canadian Immigrants," Canadian Journal of Economics, Canadian Economics Association, vol. 28(4b), pages 987-1005, November.
    5. Chiswick, Barry R & Miller, Paul W, 1985. "Immigrant Generation and Income in Australia," The Economic Record, The Economic Society of Australia, vol. 61(173), pages 540-553, June.
    6. 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.
    7. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-442, June.
    8. 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.
    9. Green, David A. & Worswick, Christopher, 2012. "Immigrant earnings profiles in the presence of human capital investment: Measuring cohort and macro effects," Labour Economics, Elsevier, vol. 19(2), pages 241-259.
    10. McDonald, James Ted & Worswick, Christopher, 1999. "The Earnings of Immigrant Men in Australia: Assimilation, Cohort Effects, and Macroeconomic Conditions," The Economic Record, The Economic Society of Australia, vol. 75(228), pages 49-62, March.
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    More about this item

    Keywords

    Immigrant workers; labour market integration; immigrant selection policy;

    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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