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Long-term immigration approach needed to maximize newcomers’ employability

posted Aug 18, 2012, 12:23 PM by Milorad Borota   [ updated Aug 18, 2012, 12:24 PM ]
Benjamin Tal, Special to Financial Post | Jul 24, 2012 3:19 PM ET | Last Updated: Jul 27, 2012 4:37 PM ET
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A recent study by the Organisation for Economic Cooperation and Development (OECD) found immigration has no impact on overall productivity. In Canada, it appears immigration is, in fact, working to reduce productivity given the chronic underemployment of immigrants in the country. According to some estimates, 20% of the increase in the U.S.-Canada productivity gap over the past decade can be attributed to immigration.

A male immigrant who arrived in Canada in the 1970s made about 80¢ on the dollar relative to a Canadian-born worker, and he was able to narrow the gap at a rate of roughly 1¢ per year. Today, despite the fact two-thirds of newcomers have post-secondary education, their earnings have dropped to close to 60¢ on the dollar and the gap is narrowing at a much slower pace. Nearly half of the individuals who immigrated to Canada between 2001 and 2006 are overqualified for the jobs they occupy.