Recent immigrants are rapidly finding jobs post-COVID, catching up with those born in Canada

Recent immigrants to Canada have rapidly gained employment and are today fuelling the growth of the job market, according to the most recent Labour Force Survey and economists.

From November 2010 to November 2022, the employment rate of recent immigrants (those granted the right of permanent residence in the past five years) grew 12.7 percentage points compared to 4.2 percent for Canadian-born workers. 

Today their employment rates are 76.3 and 85.9 percent. The smallest gap in the employment rate between the two groups was in December 2021 when recent immigrants hit 79.6 percent and Canadian-born workers were at 85.8 percent. 

The graph above is based on Statistics Canada labour force data compiled by The Hub. It compares the rate of employment (percent of those employed) of Canada’s core working-age population (25 to 54) between April 2006 and April 2024. It includes new immigrants, Canadian-born workers, and Canada’s total population inclusive of these groups and non-permanent residents. 

Last week’s Labour Force Survey estimated 90,000 new jobs were created in April. TD Canada Trust chief economist Beata Caranci called that growth “bananas” even for notoriously volatile data. 

But despite the number of new jobs, Canadian unemployment was unchanged month-over-month from 6.1 percent in March.

That’s because labour participation continues to increase due to record-breaking levels of immigration. Last year, Canada’s population grew by 1.27 million, 97.6 percent of whom were immigrants.

“The (April) unemployment rate was stable…as jobs created were offset by another 108,000 who entered the labour force” primarily through immigration, wrote Scotiabank vice-president and head of capital markets economics Derek Holt.

A February 2024 study by Statistics Canada attributed the relative growth in the employment rate of new immigrants to three factors. 

First, the expansion of the two-step immigration process in which more of Canada’s economic immigrants are being selected from the pre-existing pool of temporary foreign workers. The number of new Canadian immigrants who had work permits before obtaining permanent residency rose significantly from 19 percent in 2010 to 36 percent in 2022. 

Second, changes to Canada’s immigration selection process since 2010, including, most significantly, the Express Entry model, enacted in 2015, which places greater emphasis on Canadian work experience, language proficiency, and education. 

Third, Canada’s strong labour market which has been marked by low unemployment led to considerable demand for recent university-educated immigrants.