Newcomers drive quality growth in the Canadian workforce—but are still underutilized

Asheesh Moosapeta
Published: December 12, 2022

Statistics Canada recently released its report on the education level among Canada’s workforce.

Canada ranked first among all G7 nations (including the United States of America, the United Kingdom, France, Italy, Germany, and Japan) in terms of the share of working age (25 – 64 years) population who held a college or university credential or higher. Over half (57%) of Canada’s labour force were post-secondary graduates. In fact, Canada has led the G7 in workforce credentials since 2006.

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Why are Canadian workers so educated?

One key reason behind the growing number of qualified workers in Canada, is a strong and internationally accredited post-secondary education system, which Canadians have benefitted from. The strength of the educational sector can be seen by its growth just among Canadians.

39.7% of young Canadian-born women, and 25.7% of young Canadian-born men held a bachelor degree or higher, with consistent growth in the last ten years. In fact, the rate of growth of core-aged (25-54 year old) men who held a degree in the last five years was equivalent to the ten years before that period.

However, there is another significant reason why Canada’s labour force is more educated and qualified than ever.

The effect of immigration on the labour force

New immigrants and non-permanent residents (holders of a work permit) accounted for almost half of the growth in credentialed workforce members between 2016 and 2021. These were not just among Bachelor’s degree holders (39.1%), but also in higher education certifications like earned doctorates (55.8%), and master’s degrees (52.2%).

In fact, recent immigrants were more highly educated than any previous group, with 59.4% holding a bachelor’s degree or higher. It should be noted that Canada additionally remains the most popular destination for international students among G7 countries (with 620,000 present in Canada in 2021); A key source of skilled labour to the workforce after graduation.

Immigrants are therefore a critical addition to Canada’s workforce, not just by numbers, but also in terms of quality of skills and knowledge that they bring the economy. Newcomers are a profound contributor to Canada’s distinction as the most educated workforce among the G7 countries.

However, is Canada doing right by these newcomers?

Accreditation: A persistent problem

Over one quarter of all immigrants with a foreign degree were overqualified (defined as working in a job that typically requires a high-school education or less). Comparatively only 1 in 10 Canadians, or immigrants with a Canadian degree were overqualified in their jobs; a clear distinction that represents underutilization of internationally educated newcomers. Getting accreditation for foreign education has been an observed longstanding issue since its inclusion in the 2006 census.

This problem has started to come to the fore in light of record high job vacancies, labour shortages in several sectors, and a growing class of retirees. Canada is more in need of skilled labour than ever, and the persistence of the accreditation problem has led to a situation where the foreign skilled talent in Canada is not being optimally utilized to address labour gaps, even in high demand sectors, like healthcare.

Immigration Refugees and Citizenship Canada (IRCC) has taken the matter on board however, dedicating over $90 million in funding for new projects to help streamline accreditation for internationally trained medical professionals; and enable them to work and gain field experience in Canada more readily. Canada has additionally reduced barriers to Express Entry programs for physicians.

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