Wage discrimination,occupational segregation and visible minorities in Canada

The earnings gap between each of Whites, Asians, and Blacks is decomposed into the effects on earnings of productivity-related characteristics, wage discrimination and occupational segregation. Unlike previous Canadian studies, this paper analyses the relative economic position of both immigrant and native-born visible minorities and explicitly incorporates the effect of discrimination in occupational attainment on the earnings gap. The results indicate that policies aimed at increasing the ethnic representation across occupational categories would be effective only for Black men. Anti-discrimination legislation aimed at decreasing the earnings gap between visible minority and White women should have a dual focus: they should aim at reducing the inter-occupational wage discrimination; they should provide training programs to extend the career ladders confronting ethnic minority women.     

Psychological Traits and Earnings Differentials among Men: A Study of Second‐generation Immigrants in Sweden*

The purpose of this study is to analyse the impact of psychological traits on earnings differentials between second‐generation immigrants and individuals with native‐born parents. The study is based on a cohort of men born in 1973 and residing in Sweden in 1990. In this paper, we use an indicator of psychological ability measured in connection with the military enlistment test in Sweden. The results show that the measure of psychological traits is an important determinant of earnings at the age of 30. Using an Oaxaca–Blinder decomposition, we find that earnings differentials between second‐generation immigrants and individuals with native‐born parents are explained, to a large degree, by differences in endowments of psychological traits.     

Immigrant earnings growth: selection bias or real progress?

We use longitudinal tax data linked to immigrant landing records to study the effect of selective attrition on the estimated earnings assimilation of immigrants to Canada. Contrary to findings in the existing international literature, we show that the immigrant‐native earnings gap closes at the same pace in longitudinal and cross‐sectional data. Low‐earning immigrants are likely to leave the cross‐sectional samples over time, but the same is true for the native born. Our study suggests that immigrants to Canada have labour market participation dynamics similar to those of the native born.     

Occupational Attainment and Immigrant Economic Progress in Australia*

Using data from the 2001 Australian Census of Population and Housing, on adult men in full‐time employment, this paper augments a conventional human capital earnings function with information on occupations. It also estimates models of occupational attainment. The results from both the earnings function and model of occupational attainment indicate that the limited international transferability of human capital skills results in immigrants entering into relatively low status occupations when they first enter the Australian labour market. Comparison with similar research for the USA suggests that the different immigrant selection regimes (primarily family reunion in the USA, skill‐based immigration in Australia) do not impact on the negative association between current occupational status and pre‐immigration labour market experience.     

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.     

Education, credentials, and immigrant earnings

Abstract.  Using 1981 to 2001 Census data, we study how the human capital of immigrants is rewarded in Canada. We distinguish between years of schooling and degrees obtained in order to estimate 'sheepskin' effects – the gain in earnings associated with receipt of a degree, controlling for years of schooling. We find that immigrant years of schooling and immigrant work experience accumulated before arrival is valued much less than Canadian experience of comparable natives. However, for immigrants the increase in earnings associated with completing educational programs is generally higher than that of comparable natives. We provide both signalling and human capital interpretations of this finding.     

Assimilation to a Welfare State: Labor Market Performance and Use of Social Benefits by Immigrants to Finland*

This paper documents the economic performance of immigrants in a country characterized by an extensive welfare state and a short immigration history. Upon arrival, immigrants to Finland have substantially lower employment rates than comparable natives. While they experience rapid employment growth, only men from OECD countries catch up with natives. Despite the persisting employment and earnings differences between non‐OECD immigrants and natives, the differences in income transfers disappear in roughly 20 years. The immigrant–native employment gaps are larger in Finland than in Australia, Canada, or the US.     

Occupations,fields of study and returns to education

This paper considers several possible channels behind the well‐documented effect of education on earnings. The first channel is that education makes workers more productive on a given task, as in a conventional human capital framework. The second channel is based on the idea that education helps workers get assigned to higher‐paying occupations where output is more sensitive to skill. A third and final channel is that workers are more productive and earn more when they are matched to a job related to their field of study. Using data from the 2005 National Graduate Survey and the 2006 Canadian Census, I find that channels two and three account for close to half of the conventionally measured return to education. The results indicate that the return to education varies greatly depending on occupation, field of study and the match between these two factors.     

The evolution of male-female earnings differentials in Canadian universities,1970–2001

Abstract .  The evolution of academic salaries and the gender earnings gap in Canadian universities is analysed using a unique Statistics Canada data set containing detailed information on all full-time teachers at Canadian universities over the period 1970 through 2001. Male salaries declined across cohorts, while female salaries remained stable; consequently, male-female earnings differentials have narrowed. Recent years have also seen increasing variation in academic salaries for both men and women. A gender earnings gap remains, the bulk of which can be explained by differences in men's and women's rank and field. The unexplained earnings gap has decreased over time.     

Skill transferability and the earnings of immigrants

Using data on immigrants from the Canadian Census, we compare immigrants who received a bachelor's degree from a Canadian university to immigrants who receive a bachelor's degree in their home country, in order to investigate the returns to skills acquired in Canada versus skills acquired abroad. Our measure of skill is based on postsecondary fields of study linked to the O*NET matrix of skills and competencies. We find that immigrants educated in Canada receive higher returns to their communication skills than those educated abroad. To a lesser degree, they also receive higher returns to their logical and technical skills. These gaps in skill returns explain the entirety of Canadian-educated immigrant's 10% earnings advantage. Our results are robust to controlling for the quality of universities in the immigrant's country of study and for occupation and industry choice. The gaps are stable across time and across quantiles of the immigrant earnings distribution.     

Skilled Immigrant Women in the US and the Double Earnings Penalty

Abstract

Although a large literature exists on the United States labor market experiences of low-skilled immigrant men, relatively few studies have examined the labor market position of highly skilled immigrant women. The current study explores the issue of labor market discrimination and examines the extent to which highly skilled immigrant women experience an earnings disadvantage as a result of both gender status and nativity status. Relying on data from the 2000 US Decennial Census 5-Percent Integrated Public Use Microdata Sample and using an augmented Oaxaca decomposition technique, this study finds that highly skilled immigrant women do experience a double earnings penalty. In addition, the results suggest that nativity status explains a larger portion of the double earnings penalty than gender status. These findings are important in light of the higher emigration rates for skilled women than for skilled men in regions such as Africa, Latin America, and Oceania.     

The dynamics of immigrant participation in entitlement programs: evidence from Canada, 1993–2007

Abstract Using uniquely rich Canadian administrative data from the 1993–2007 period, I find no evidence of rising Employment Insurance (EI) participation across recent‐immigrant cohorts and no evidence of rising EI participation with number of years spent in Canada beyond the short period following entrance into the Canadian labour market. I also find little evidence of the rising immigrant participation in Social Assistance (SA), either across recent arrival cohorts or with years in Canada. The results do not appear to be seriously affected by emigration and attrition within each immigrant cohort. While the immigrant participation in traditional ‘welfare’ programs such as Social Assistance has generally declined from 1993 to 2007, I show that Canada Child Tax Benefit and other federal and provincial programs aimed at providing financial assistance to families with children have become a major source of transfer income to immigrant families.     

Immigrant earnings: age at immigration matters

A correlation between age at immigration and earnings is observed in Canadian census data. The evidence supports three underlying sources of the effect; first, work experience in the source country yields virtually no return in the host country; second, the return to education varies with age at immigration, and, finally, an 'acculturation' effect is observed for immigrants who are visible minorities or whose mother tongue is not English. Further, it is found that educational attainment, and relatedly earnings, vary systematically across age at immigration with those arriving around age 15 to 18 obtaining fewer years of education. JEL Classification: J61, J31     

Earnings Differentials among Ethnic Groups in Canada: A Review of the Research

Canada has a large foreign-born population with an increasingly diverse ethnic profile. The 1986 Employment Equity Act designated ''visible minorities,'' Aboriginal peoples, women, and disabled persons as facing labor market disadvantages. This review of a growing body of research on ethnic earning differentials shows that the sizeable earnings shortfall of Aboriginal peoples could be ''explained'' by their lesser endowments of work-related characteristics. The high variance in discrimination estimates among men can be traced to the treatment of immigration effects, aggregation of diverse ethnic groups, and the choice of the non-discriminatory earnings norm.     

The English Language Fluency And Earnings Of Ethnic Minorities In Britain

This study addresses two issues. First it estimates how much of the male and female ethnic earnings gap is the result of an advantage in the English language and whether there is an earnings penalty to non–whites, over and above this. Lack of fluency is shown to have a highly significant impact on the earnings of ethnic minorities in Britain, although the language penalty is much greater for women than it is for men. Moreover, only foreign born non–white males that have arrived in Britain between 1970 and 1994, exhibit lower earnings once language fluency is taken into consideration, whilst British born females exhibit higher earnings. So the evidence here suggests that non–white earnings are assimilating towards those of whites and that lower female non–white earnings are a direct result of a lack of fluency rather than ethnicity. Secondly, the study will try to measure any endogenous bias associated with the non–fluency earnings penalty. Controlling for the endogeneity between language fluency and earnings is shown to be problematic. Estimates suggest that single equation earnings functions slightly underestimate the true language fluency penalty for males, and slightly overestimate the fluency penalty for females. Finally, education and fluency are not surprisingly shown to be complementary.     

Male–female wage discrimination in Chinese industryInvestigation using firm‐level data1

We use firm‐level data to analyze male–female wage discrimination in China's industry. We find that there is a significant negative association between wages and the share of female workers in a firm's labour force. However, we also find that the marginal productivity of female workers is significantly lower than that of male workers. Comparing wage gaps and productivity gaps between men and women, we notice an intriguing contrast between state‐owned enterprises (SOEs) and private firms. The wage gap is smaller than the productivity gap in SOEs, while the converse is true for private firms. These results suggest that women in the state sector receive wage premiums, whereas women in the private sector face wage discrimination.     

Panel estimates of the earnings gap in Norway: do female immigrants experience a double earnings penalty?

This study explores the possibility that being both a ‘female’ and an ‘immigrant’ will impose an earnings disadvantage on immigrant women in Norway. Well-known techniques are used to decompose the earnings gap between Norwegian men and immigrant women into portions attributable to productivity differentials, portions attributable to a gender effect, and portions attributable to an ethnic effect. The analysis supports the following conclusions: First, there is evidence of a double negative effect on female immigrant earnings. Second, gender effect is more important than ethnic effect. Finally, the discrimination estimates are robust to the alternative methods used in decomposing Norwegian men-immigrant women earnings gap.     

Ethnic and Other Minority Representation in UK Academic Economics

Using a survey questionnaire of academic economists in the United Kingdom, we examine the representation of ethnic and other minorities. We find that nearly 12% of UK-employed academic economists are of ethnic minority origin. However, only 1% of the sample are UK-born ethnic minority. Controlling for individual and workplace characteristics, there is no significant ethnic minority effect on academic rank. However, there is a significant negative earnings effect. Further, 41% of ethnic minority economists feel that they have suffered workplace discrimination.     

The impact of the Self‐Sufficiency Project on the employment behaviour of former welfare recipients

Abstract The Self‐Sufficiency Project (SSP) was a Canadian randomized trial in which the program group had 12 months to find full‐time employment in order to qualify for a subsidy that roughly doubled their pre‐tax earnings for the next three years. We find evidence of significant impacts of SSP on non‐employment and employment durations. For the treated group, simulation results show an impact on the employment rate at 52 months after random assignment in the range of 7 to 11 percentage points; this is approximately a 25% increase in the employment rate compared with having no treatment in place.     

Why do immigrant workers in Australia perform better than those in Canada? Is it the immigrants or their labour markets?

Research comparing the labour market performance of recent cohorts of immigrants to Australia and Canada points to superior employment and earnings outcomes in Australia. Examining Australian and Canadian Census data between 1986 and 2006, we find that this performance advantage is not driven by differences in broader labour market conditions affecting all new labour market entrants. Rather, the results from comparing immigrants from a common source country – either the U.K., India, or China – suggest that Australian immigrants perform better, particularly in average earnings, primarily because of a different source country distribution. Moreover, the recent tightening of Australian selection policy, most notably its use of mandatory pre‐migration English‐language testing, appears to be having an effect, primarily by further shifting the source country distribution of immigrants away from non‐English‐speaking source countries, rather than in identifying higher‐quality migrants within source countries.