Research Watch #7: Enclaves and Earnings

by Priya Ramanujam (@SincerelyPriya) in Scarborough, Ontario

Several observers have noted that immigration is, generally, a non-partisan issue in Canada. That probably explains why it’s not a topic of debate during this current federal election campaign. But, it’s safe to say that the next government will inevitably be confronted with competing demands on the immigration file.

In this edition of Research Watch, we offer the next Minister of Immigration a look at two studies that highlight why federal policymakers need to understand where immigrants settle, how they integrate and factors that determine their economic success in Canada. 

The truth about ethnic enclaves

A recent study released by the Institute for Research on Public Policy challenges the notion that communities with high populations of visible-minority immigrants are rife with socio-economic marginalization and cultural isolation.

In the report “Ethnocultural Minority Enclaves in Montreal, Toronto and Vancouver,” researcher Daniel Hiebert sets out to answer whether these enclaves are the so-called “ghettos” they are often perceived to be.

While the answer proves complex and varied, the key finding of Hiebert’s research is that, in Canada, this tends not to be the case.

[quote align=”center” color=”#999999]”[I]t seems to me very relevant to have more of a municipal voice when it comes to the big questions about immigration policy and settlement policy in Canada.[/quote]

This is particularly true of neighbourhoods where there is a dominant ethnocultural group (twice the size of any other group) living alongside several smaller groups.

“[In these communities] the stereotype of the poor immigrant neighbourhood doesn’t work,” Hiebert says. “Where there is one large group, there’s probably some sort of internal capacity for helping people because of the scale of that group.”

He suggests that this is the case because social capital is strong in these communities. Immigrants are more likely to find work more easily or have success in small business ventures because of shared commonalities with other residents.

In addition, the many other cultural groups in the enclave prove to be an asset, Hiebert explains, offering what he calls “bridging” social capital – the type of learning that comes from being exposed to other cultures that helps integrate into mainstream society.

Communities with a high percentage of visible minorities that tended to have more socio-economic challenges were those where no dominant group was present – rather, just several small cultural groups residing together.

For Hiebert, the findings highlight three important ideas.

First, he says, “Cultural diversity is everywhere.” He cites an example: in the past, an organization in “Chinatown” may have found it effective to exclusively serve Chinese Canadians, but with what is now known about the diverse make-up of communities, that type of exclusivity may mean some residents are left behind.

Second, it is time to re-evaluate services for immigrants overall. Hiebert points out that many present-day services were developed in the 1970s when immigrants were settling in inner-city locations rather than suburban ones, and while that is changing, agencies may not be keeping pace.

Finally, Hiebert concludes his study by stressing that in order to truly understand and serve these ethnocultural communities effectively, municipal governments must be at the decision-making table and engaged in the development and reform of immigration policy.

“If cities are the places where most immigrants are settling and integrating,” says Hiebert, “it seems to me very relevant to have more of a municipal voice when it comes to the big questions about immigration policy and settlement policy in Canada.”

Contributors to economic success

With Canada continuing to compete in the global market to attract economic immigrants, a better understanding of predicting future earnings and success here is vital.

A recently released study from Statistics Canada based on historical data observing two cohorts of immigrants from the late 1990s and the early 2000s may help in this area. 

The study shows that, in the short-term, the best predictors of earnings are Canadian work experience and official-language skills at the time of arrival.

“Basically, it appears that economic principal applicants with Canadian work experience at the time of landing are treated more like Canadians in the labour market in terms of returns to education and experience,” explains researcher Aneta Bonikowska, adding the same goes for having strong official-language skills.

But in the long-term (over a period of five to 10 years), this changes. Age and education play a factor.

[quote align=”center” color=”#999999″]In the short-term, the best predictors of earnings are Canadian work experience and official-language skills at the time of arrival.[/quote]

“Even though we don’t see a big return right off the bat, the earning trajectories of higher, better-educated immigrants are steeper than lower-educated immigrants – over time you see a gap in earnings developing on average,” says Bonikowska.

There is also a correlation between all four characteristics that affects the long-term predictions of an immigrant’s earnings.

As Bonikowska explains, the economic returns on age (the younger an immigrant, the higher the earnings, typically) and education at landing depend on that immigrant’s official-language skills and previously accumulated Canadian work experience.

While the Stats Canada report is meant to be an exercise in analyzing historical data – not a forecast of the future – Bonikowska points out that, from a policy standpoint, if more detailed information was collected from arriving economic immigrants, better predictions could be made about their potential success.

She says factors like the nature of an immigrant’s study, what institution he or she studied at and what level of education was achieved prior to arriving in Canada would give a better sense of who did well from the cohorts studied.

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