New immigrants earning closer to median Canadian income: report

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OTTAWA • New immigrants are increasingly earning closer to the median income of all Canadians, according to a new report by the federal government’s financial watchdog.

And it’s because they’re gaining work skills as temporary residents first before transitioning into permanent status.

More and more newcomers also already have family ties in Canada, finds the report, and there’s a correlation between what country an immigrant comes from and their income after a first year.

The Parliamentary Budget Officer has released a new report studying the income of new immigrants, noting that the federal government recently confirmed its immigration target of 500,000 new people for the year 2025 and extended that target to 2026.

The new report also comes as New Brunswick’s population rocketed up by another 8,000 people over the last quarter, and has now climbed by roughly 25,000 people over the last year, growing to 842,725 as of Oct. 1.

The province’s population has only increased by that much in a single quarter three times since Confederation.

All three times are in the last year and a half.

And it’s now almost solely due to international newcomers, as net interprovincial migration is still bringing thousands of Ontario residents to New Brunswick but New Brunswickers are leaving in larger numbers, wiping out most of those gains.

The Parliamentary Budget Officer attempts to determine their impact on the economy.

The report finds that, between 2014 and 2018, the median total income of newly arrived immigrants one year after acquiring permanent residency went from 55 per cent of the median total income of all tax-filers, to 78 per cent.

It’s a gap that’s only closing.

Data from 1990 to 2014 shows immigrants had a median total income one year after landing that was persistently below 60 per cent of the median for all tax-filers.

“This implies that the total income of new immigrants rose significantly faster than did the total income of all tax-filers,” reads the report.

“Trends driving that change include greater pre-landing experience, a shift of source-countries to south Asia, greater family connections of incoming migrants.”

The report says that matters because “lower relative incomes of new immigrants could create a temporary drag on Canadian measured productivity growth.”

“Though that effect would be removed as the cohort of new immigrants integrate into the labour force, the arrival of new immigrants each year would reinitiate the impact,” it adds.

“The recent smaller gaps between the incomes of new immigrants and the Canadian median could reduce that compositional effect on measured productivity.”

The report notes that between 2014 and 2018 the number of temporary residents in Canada increased by 44 per cent or 112,000 people, or by 57 per cent, 204,000 people, when including students and refugees.

It suggests that experience is resulting in higher wages for permanent residents.

“Temporary residents often transition into permanent status, at which point they have greater work or study experience and familiarity with Canada,” reads the report, adding that new immigrants are coming “into a more receptive environment, facilitating their labour market transition.”

That’s of interest in New Brunswick as temporary worker numbers soar.

A net 5,575 non-permanent residents were recorded in the last quarter, a figure that includes international students and temporary foreign workers.

The report then suggests that the increase in income occurred “while the number of immigrants with family ties in Canada was increasing – suggesting that pre-existing social networks are important for economic outcomes.”

Meanwhile, it makes a connection between the country of origin of newcomers and earnings.

While the report found that a rise in wages “was somewhat broadly based since it applied to immigrants from a wide range of source countries,” it adds that a change occurred “disproportionately with immigrants from India, though Philippines and China.”

“The increase in relative income is dominated by professional groups such as engineers, applied scientists,” it adds.

The latest census data shows mother tongue of New Brunswickers now includes more than 160 different languages.

A total of 17 of those languages have a community of more than 500 people.

That’s up from 13 in 2016 and just nine in 2011.

Arabic became the third largest mother tongue in New Brunswick in 2016, but has now grown even larger. A total of 4,345 now count that as their native language, up from 2,855 in 2016 and 1,325 in 2011.

Second is now Tagalog or Filipino, the national language of the Philippines.

That community has grown to 2,590, up from 580 in 2011.

Mandarin is third, although numbers have remained mainly stagnant over the last five years, with 2,335 counting it as their mother tongue in 2021, versus 2,255 in 2016.