2010 ALLIES Learning Exchange: Naomi Alboim - Immigrants and the Economic Recovery

Immigrants and the economic recovery: What are the policy implications? Naomi Alboim 2010 ALLIES Learning Exchange May 7, 2010 Halifax

Purpose  As the economy recovers from the most recent recession, and as data become available, we are starting to see the impact of the recession on Canada’s immigrants.  This presentation: – Draws conclusions about how immigrants fared during the recession – Raises public policy implications – Makes recommendations for consideration by public policy makers 2

Key findings  Immigrants as a group were hurt badly by the recession, but the impact varies depending on sector, geographic location, length of time in Canada, gender and other factors. – Hardest hit: recent immigrants; men; young; manufacturing  Though hurt by the recession, many are not eligible for the things that would help them to recover (e.g., language training, employment insurance, income assistance).  We need to unpack the data to design targeted interventions that will enable immigrants to contribute to economic growth. 3

Data sources  Looked at Canada, Ontario and Greater Toronto Area to see if the picture changes.  A lot of helpful data from Statistics Canada, in Metropolis presentations.  Intergovernmental Relations Group (IGR) of Toronto Region Immigrant Employment Council (TRIEC) was instrumental in generating additional data and insights for GTA. – municipal welfare data – focus groups with immigrant-serving agencies – early warnings from the field and funded organizations – in-camera monthly meetings to identify gaps and recommendations for action 4

Recession hypothesis  One hypothesis going into the recession was that it would have a disproportionately negative impact on immigrants in Canada.  Preliminary data indicate this hypothesis was correct, but with differential impact among immigrants. – Main focus of this presentation. – Caveat: more data and study required 5

Immigration levels  In the 1980s, Canadian immigration levels were reduced in response to recession and subsequent persistent high unemployment rates .  During the recent recession, immigration levels were maintained to meet longer-term population and labour market objectives – This was also the approach adopted by New Zealand and Sweden. Australia and UK, however, reduced immigration levels in response to recession.  Don’t know the longer term impact on cohort arriving during recession.  Need to know how immigrants have fared and other impacts of the recession on immigrants to determine policy and program interventions. 6

A. How have immigrants fared in Canada?

Job loss: length of residency  Recent immigrants were hardest hit by recession job loss  Between October 2008 and October 2009, recent immigrants accounted for 22% of all job losses, compared with just 3% of employment.  Consistent with the experience of other OECD countries.  Established immigrants fared relatively well.  Immigrants with 10 years or more residency actually gained jobs, compared with a 2.2% loss in employment among Canadian-born workers.  Immigrants here between 5 and 10 years were comparable to Canadian born. 8

Job loss: length of residency Job losses and employment by immigrant status-Canada October 2008 – October 2009 Seasonally unadjusted, 3 month moving average Immigrant status % change in employment Recent immigrants, 5 years or less -13.4 Immigrants, between 5 and 10 years -2.8 Canadian-born -2.2 Established immigrants, 10 years + +1.4 Source: Statistics Canada labour force survey. From HRSDC presentation at Metropolis conference 2010. 9

Job loss: cities  Recent immigrants accounted for essentially all net job losses in Canada’s three largest cities (Montreal, Toronto, Vancouver) between October 2008 and October 2009. – Their employment declined by 17%, compared to virtually no decline for Canadian-born workers.  Recession impacts were less severe for immigrants with 5 to 10 years residency.  Established immigrants with more than 10 years of Canadian residency experienced job gains, faring better than Canadian-born workers. 10

Job loss: cities Job losses and employment in Montreal, Toronto and Vancouver by immigrant status, October 2008 - October 2009 Seasonally unadjusted, 3-month moving average Immigrant status % change in employment Recent immigrants, 5 years or less -17.2 Immigrants, between 5 and 10 years -5.5 Canadian-born 0.0 Established immigrants, 10 years + +0.8 Source: Statistics Canada labour force survey. From HRSDC presentation at Metropolis conference 2010. 11

Job loss Immigrants vs. other groups  Nation-wide and in the 3 largest cities, recent immigrants are more affected by job loss than other groups. – Due, in part, to status as new labour market entrants with relatively low job tenure and Canadian work experience. – Even though educated, did worse than workers with less than high school.  Youth were also significantly overrepresented among net job losses, but to a lesser degree than recent immigrants. 12

Job loss Immigrants vs. other groups Job losses and employment among selected groups October 2008 - October 2009 Vulnerable groups % change in employment Recent immigrants, 5 years or less -13.4 Workers with less than high school -11.1 Youth 15-24 -8.7 Aboriginal peoples -5.1 Workers with high school and/or some PSE -3.0 Older workers 55+ +3.7 Source: Statistics Canada labour force survey. From HRSDC presentation at Metropolis conference 2010. 13

Employment by industry  Immigrants are significantly represented in certain industries, particularly manufacturing. – The manufacturing sector was hardest hit by the recession and job loss. – Employment fell by 36% for recent immigrants, compared to 14% for established immigrants and only 8% for Canadian-born workers. 14

Incidence of employment by industry Incidence of employment by industry for selected groups (25-54), February 2010 Recent immigrants, 5 years or less Established immigrants, 5 years+ Canadian-born Public administration Other services Accommodation and food services Information, culture and recreation Health care and social assistance Educational services Business, building and other support services Professional, scientific and technical services Finance, insurance, real estate and leasing Transportation and warehousing Trade Manufacturing Construction Utilities Forestry, fishing, mining, oil and gas Agriculture 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% Source: Statistics Canada labour force survey. From HRSDC presentation at Metropolis conference 2010. 15

% change in employment by industry % change in employment by selected industries and immigrant status, seasonally unadjusted, October 2008-October 2009 Recent immigrants, 5 years or less Established immigrants, 5 years + Born in Canada 10 5 5 3 2 0 0 -1 -5 -3 -6 -6 -5 -10 -7 -8 -7 -9 -8 -9 -15 -13 -14 -16 -20 -25 -30 -27 -35 -31 -36 -40 Goods- Services- Construction Manufacturing Transportation Accommodation Professional, producing producing and and food scientific and sector sector warehousing services technical services Source: Statistics Canada labour force survey. From HRSDC presentation to Metropolis conference 2010. 16

Gender impact  Immigrant men – like Canadian-born men – were much more severely affected than immigrant women by recession-related job loss. – They experienced a much steeper drop in employment rate and larger rise in unemployment rate than immigrant women. – As with Canadian-born men, this is largely related to the composition of employment (e.g., male employment in manufacturing and construction).  The gender difference was most pronounced among recent immigrants: – In this group, men’s employment rate declined by 8.5% points, vs. no decline for women. 17

Gender: changes in employment rates Changes in employment rates by immigrant status and gender, October 2008 and October 2009, seasonally unadjusted 1 0 -1 Percentage points -2 -3 -4 -5 -6 -7 -8 -9 Men Women Men Women Men Women Recent immigrant, 5 years or less Established immigrant, 5 years+ Canadian-born Source: Statistics Canada labour force survey. From HRSDC presentation at Metropolis conference 2010. 18

Age: job loss and employment  Immigrants in the youngest category - age 15 - 24 – are the worst off.  Within the 25-54 group, immigrants – especially recent immigrants – were noticeably more affected by recession job loss than Canadian- born.  Older recent immigrants, like older Canadian- born workers, experienced job gains between October 2008 and October 2009. 19

Age: changes in employment rates Changes in employment rates by immigrant status and age, October 2008-October 2009, seasonally unadjusted 1 0 -1 Percentage points -2 -3 -4 -5 -6 -7 15-24 25-54 55 Years + 15-24 25-54 55 Years + 15-24 25-54 55 Years + Recent immigrants (<=5yrs) Established immigrants (5 yrs+) Born in Canada Source: Statistics Canada labour force survey. From HRSDC presentation to Metropolis conference 2010. 20

B. Regional differences?

Regional differences  Preliminary findings show the recession has had a disproportionate impact on immigrants as a group in Canada.  What about regional differences?  Looked at Ontario and Greater Toronto Area to show how the picture can change. 22

Ontario snapshot  30% of Ontario’s labour force is immigrants  55% of Canada’s immigrant labour force is in Ontario.  40% of Canada’s immigrant labour force is in the Toronto Census Metropolitan Area.  Ontario has 39% of Canada’s population and 55% of the job loss. – Decline in manufacturing, construction and service sectors key factor because that is where immigrants are significantly represented in Ontario. 23

Regional differences in labour force Immigrants in the Labour Force 30.0% Ontario - 30% 25.0% Canada - 21% Percent of Labour Force 20.0% 15.0% 10.0% 5.0% 0.0% CA NF PE NS NB QC ON MN SK AB BC Very Recent (< 5 yrs) Recent (5 - 10 yrs) Established (> 10 yrs) Source: Statistics Canada Labour Force Survey. From Ontario Ministry of Citizenship and Immigration presentation at Metropolis 2010. 24

Ontario: unemployment  Once in Canada 10 years or more, the unemployment rate is not much different than Canadian born.  Major concern: for very recent immigrants (less than 5 years), the rate is still going up.  Also concerned about recent immigrants (5-10 years). 25

Ontario: unemployment Ontario Unemployment Rate by Immigrant Period of Arrival (Jun 08 to Jan 10) 20 18 16.1 Very recent immigrants (< 5 16 yrs in Canada) 14 Unemployment Rate (%) 12.6 12 Recent immigrants (5 - 10 yrs in Canada) 10 8.7 8 8.1 Established immigrants (> 10 6 yrs in Canada) 4 Canadian-born 2 0 Mar-09 May-09 Dec-09 Dec-08 Oct-09 Oct-08 Aug-08 Aug-09 Apr-09 Jan-10 Jul-08 Jan-09 Jul-09 Feb-09 Sep-08 Sep-09 Nov-08 Nov-09 Jun-08 Jun-09 Source: Statistics Canada Labour Force Survey. From Ontario Ministry of Citizenship and Immigration presentation at Metropolis 2010. 26

Ontario: education and unemployment Unemployment rate for university graduates, Ontario 16.0 13.9 14.6 14.5 14.0 12.5 12.0 Very recent immigrants, 5 12.0 years or less 11.5 10.0 10.9 Recent immigrants, 5 to 10 9.7 years 8.0 Established immigrants, 10+ 6.0 5.0 5.0 years 4.2 4.5 Born in Canada 4.0 2.0 3.1 3.1 2.8 2.9 0.0 January 2009 February March 2009 April 2009 2009 Source: Toronto Immigrant Employment Initiative, York University. 27

Greater Toronto Area: unemployment Unemployment rate Toronto CMA Labour Force Survey July 08 Aug 09 Dec 09 Less than 5 years in Canada 12.6 16.5 14.8 5-10 years in Canada 9.9 17.7 12.5 10+ years in Canada 8.0 10.9 8.4 Born in Canada 6.2 9.1 7.6  Much of the recent employment growth is in part time work. 28

GTA: need for services  Immigrant service agencies, community service providers and municipal governments report significant increase in recently unemployed immigrants who: – Have been in country more than three years – Entered manufacturing because unable to find jobs suitable to their education and experience – Did not upgrade language skills or pursue licensure upon arrival – Now unemployed and seeking federal services and language training to make use of their skills and education Source: Focus groups with immigrant service agencies through Intergovernmental Relations Group of the Toronto Region Immigrant Employment Council 29

C. What are the policy implications?

1. Learn from past recessions  In 1981, recent immigrant employment rates were close to Canadian-born. Two periods of recession reduced immigrant employment and they never recovered. – 1980s: Recent immigrants’ employment rate did not recover before the 1990s recession hit. Their unemployment rate never returned to pre-recession level. – 1990s: Recent immigrants’ employment rate continued to decline and their unemployment rate continued to rise, while labour market outcomes for Canadian-born workers improved.  In previous recessions recent immigrants were more affected by job loss than Canadian-born workers, contributing to a widening of employment rate and unemployment rate gaps.  We need to ensure immigrants can recover this time and that the gap does not widen. 31

Past recessions: employment rates Employment Rates for Recent Immigrants and Canadian-born (15-64), 1981-2006 Canadian-born Recent Immigrants 80 70 60 Employment rate (%) 50 40 30 20 10 0 1981 1986 1991 1996 2001 2006 Source: Census 1981 to 2006. From HRSDC presentation at Metropolis conference 2010. 32

Past recessions: unemployment rates Immigrants and Unemployment Rates for Recent Canadian-born (15-64), 1981-2006 Canadian-born Recent Immigrants 20 18 16 14 Percentage (%) 12 10 8 6 4 2 0 1981 1986 1991 1996 2001 2006 Source: Census 1981-2006. From HRSDC presentation at Metropolis conference 2010. 33

2. Unpack the data  We require more study of the impact of the recession on immigrants to understand the interventions that are needed.  We need flexible national programs that are responsive to real differences. – This requires “unpacking the data” to see differences in impact based on region, sector, length of time in Canada, etc.  We need dialogue with immigrants and the agencies that serve them to put a human face to the numbers, charts and graphs. 34

3. Grow the labour force  Current recovery prospects appear fairly positive for Canada. – A return to employment growth was seen in just a few countries in late 2009, including Canada, Australia, Poland, Israel and the United Kingdom.  As Canada’s economy improves, there will be a huge need for labour. – The immigrant population is a labour force already in Canada.  With some investment, those harmed by the recession can contribute to the economy as it grows. – With language skills, etc. immigrants can contribute to the growth. – Without services, they will not fare well and we will not benefit from their potential. 35

…grow the labour force  A relatively rapid bounce back to pre-recession employment levels and unemployment rates is anticipated in 3-4 years, in part because slowing labour force growth will support declining unemployment rates.  With slowing growth, Canada will likely return relatively quickly to tight labour markets. We need the skills and abilities of every worker.  We must maximize participation and productivity in an environment where economic growth will face demographic constraints.  Education and skills of recent immigrants must be fully utilized. Canada can not afford to waste this potential. 36

4. Address barriers to labour market integration  Immigrants and employers most frequently cite the following barriers to labour market: – Lack of official language skills – Transferability of foreign credentials – Lack of Canadian work experience  Employers cite language barriers more frequently – number one issue for them. 37

…barriers Immigrant and employer views on obstacles to employment Immigrant Managers job seekers expecting to hire % of immigrants reporting problems in finding employment/ % 70% 72% of managers expecting problems hiring foreign-trained workers Most commonly cited problems Lack of Canadian work experience 26% 46% Transferability of foreign credentials 24% 52% Lack of official language skills 22% 66% Source: Presentation by HRSDC at Metropolis conference 2010. Immigrant job seeker data from Statistics Canada Longitudinal Survey of Immigrants to Canada, Catalogue no.89-611-XIE; Managers data from Canadian Labour and Business Centre’s Viewpoints 2002 Survey. 38

Language makes a difference  Research suggests that, if official language abilities are controlled for, returns to education are similar for immigrants and Canadian-born. Source: Ana Ferrer, David A. Green, W. Craig Riddell, 2008, Literacy and the Labour Market: Cognitive Skills and Immigrant Earnings.  Immigrants who went into manufacturing did not require language upgrading so did not access services. Now many are citizens and no longer eligible for federally funded language training. 39

Other factors make a difference  Other interventions can help but are not widely available. – Canadian top-ups (internships, bridge training) reverse discounting and lead to success. – Social capital : social and professional networks (e.g. mentoring) enhance labour market integration. 40

5. Invest in programs & services  Time to invest in language training, upgrading and other programmatic interventions to: – prevent recession “scarring” and deskilling of immigrants – ensure skilled labour force is ready for the recovery  However serious barriers prevent immigrants harmed by the recession from gaining access to programs and services. 41

EI benefits  Because of changes in EI (more stringent labour attachment requirements), it is more difficult for unemployed people and particularly immigrants to qualify for benefits. – Part time, seasonal, non-standard work = less labour market attachment.  Women are less likely to qualify than men. – More part time work and maternity leaves.  Yet access to most training dollars and programs dependent on EI eligibility 42

EI benefits Source: Keith Banting, Queen’s University, 2010. 43

EI in Ontario  The Employment Insurance legislation has been adjusted in a way that creates geographic disparities. – Unemployed persons in Ontario are less likely to get benefits than other parts of the country. 44

EI across Canada Source: Keith Banting, Queen’s University, 2010. 45

Social assistance & unemployment  In 2009, unemployment went up in Ontario but social assistance stayed down. Source: Keith Banting, Queen’s University, 2010. 46

GTA social assistance  Although numbers, rate of circulation and length of time in receipt of welfare are up modestly, GTA municipalities report no disproportionate increase in welfare rates for immigrants vs. non-immigrants.  In Toronto, immigrants here three years+ make up the same portion of new cases as Canadian born; immigrants less than 3 years in Canada comprise only half the proportion of new Canadian born cases.  Reasons could include: – Stigma – Sponsorship agreements – Lack of awareness – Restrictive provisions regarding assets Source: Greater Toronto Area municipalities. 47

Lack of eligibility for existing programs  If unemployed but no significant labour force attachment, ineligible for EI or EI supported training (disproportionate impact on Ontario).  If on EI, cannot continue to receive benefits while in full time language training.  LMA training funds in Ontario not directed to immigrants as target group: definition of underemployment is quantitative, not qualitative  If citizen (3 years+), ineligible for federal programs and services, including LINC. 48

…Lack of eligibility  LINC provides no income support, so many take survival jobs to support their families and have no time to take language training.  Welfare workers can approve training (including language) but applicants need to strip all assets to be eligible for social assistance.  Other training programs provide no income support, child care or transportation allowances, so difficult to access.  New loan program in Ontario for bridge training covers tuition and supplies only. 49

D. Recommendations

Recommendations Data 1. Conduct more in-depth analysis on the impact of the recession on immigrants. 2. Analyse data by province, city, sector, length of time in Canada, gender, and education level in order to target programs to needs. 3. Do investigations on the ground with immigrant agencies to see real-life impact of recession on immigrants. 51

Recommendations Access to programs & services 4. Determine eligibility for federal settlement and language programs by need, not citizenship status. 5. Expand the definition of “underemployment” for program eligibility to include the mismatch between qualifications and employment. 6. Expand bridge training programs, internship and mentoring programs with employer supports. 52

Recommendations Income and supports 7. Provide income support/training allowances to immigrants for language training, bridge training, and other training opportunities. 8. Provide child care and transportation support/allowances to immigrants participating in language training, bridge training, and other training opportunities. 9. Continue EI and social assistance benefits while immigrants are participating in language training, bridge training, and other training opportunities. 10.Expand loan program for immigrants to access training. 53

CONCLUSION  We need to focus on strategic investments in people.  Investing in skilled immigrants’ human capital, social capital, and access to services now will prevent long term scarring and yield positive results for the recovery and beyond. 54

2010 ALLIES Learning Exchange: Naomi Alboim - Immigrants and the Economic Recovery

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2010 ALLIES Learning Exchange: Naomi Alboim - Immigrants and the Economic Recovery — Presentation Transcript