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Canadian work experience and education boosts immigrant earning potential; study

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Prior Canadian work experience makes a big difference to the entry-level wages that new immigrants earn, a Statistics Canada study shows.

The report looking at outcomes for permanent residents who were admitted to Canada in 2016 found that those with prior work experience in Canada had the highest median entry wages of those studied after one year.

New permanent residents who had both worked and studied in Canada had a median entry wage of $39,800 one year after arrival, while those who had been work permit holders only had a median income of $38,100.

“These wages are comparable with those of the entire Canadian population,” Statistics Canada says.

The median entry wage for the 2016 cohort as a whole was $25,900 in 2017, which the study said was “the highest recorded among immigrants admitted since 1981.”

This outcome, however, fell well short of the Canadian population’s median wage of $36,100 in 2017.

More Canadian work experience, more earnings

Statistics Canada said the observed growth in entry-level wages could be partly explained by the fact an increasing number of non-permanent resident permit holders with Canadian work experience are transitioning to permanent residence.

“From the 2007 admission year to the 2016 admission year, the number of immigrant taxfilers one year after arrival who had work experience in Canada increased by 166% while the number of immigrants without work experience rose 2%,” the study notes.

Immigrants’ wages generally increase with the number of years since getting permanent residence. Looking back at immigrants who were admitted to Canada in 2007, their median wage one year after arrival was $20,400. By 2017, the median wage of the same cohort reached $33,500, an increase of 64 per cent.

A closer look at who saw the most gains in that 10-year span reveals that once again, work permit and study permit holders had the highest median wage, which was up 81 per cent to $63,800 in 2017.

“Their wage exceeded that of immigrants who held only a work permit (up 36 per cent to $48,100) and that of Canadians as a whole,” Statistics Canada said.

Pre-admission work experience also plays a role in retention. The study says 90 per cent of Economic-Class immigrants who were admitted to Canada in 2012 were still in the same province five years later.

Those without pre-admission Canadian work experience had a retention rate of 81 per cent.

Overall, 86 per cent of immigrants who were admitted in 2012 filed a 2017 tax return in the same province where they first settled as permanent residents.

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