Explaining the Deteriorating Entry Earnings of Canada's Immigrant Cohorts, 1966-2000

Abstract

Using the 1981, 1986, 1991, 1996, and 2001 Canadian Censuses, we explore causes of the deterioration in entry earnings of successive cohorts of immigrant men and women. Roughly one-third of the deterioration is explained by compositional shifts in language ability and region of birth. We find no evidence of a decline in the returns to foreign education for either immigrant men or immigrant women but a definite deterioration in the returns to foreign labour market experience, most strongly among men from non-traditional source countries. We can explain roughly two-thirds of the male and one-half of the female deterioration without any reference to entry labour market conditions. When we also account for entry conditions, our results suggest Canada's immigrants of the late 1990s would otherwise have enjoyed entry earnings equal to or higher than their counterparts of the 1960s.

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