Ontario’s Financial Accountability Office has unveiled a comprehensive report detailing the Labor Market Outcomes of Permanent Residents in both Ontario and its major cities. As per the findings, Recent newcomers soar in Ontario’s workforce dynamics.
The employment results of newly admitted permanent residents are a major factor in the province’s economic growth, as the report emphasizes. In 2022, Ontario had a record-breaking influx of foreign immigrants, with an expected continued high of 227,424.
The results show that since the mid-2010s, immigrants have contributed to about two-thirds of Ontario’s labor growth. The goals outlined in the federal Immigration Levels Plan have an impact on the amount of immigrants who choose to settle in Ontario. IRCC sets annual goals for the number of new permanent residents it will accept. According to the 2024–2026 strategy, Canada hopes to accept 485,000 permanent citizens in 2024 and 500,000 in each of the following two years.
It is evident that Ontario is the most preferred province for immigrants, and a major reason for this desire is the large number of nominations it receives under its Provincial Nominee Program. With the PNP, provinces can select economic immigrants carefully who have a good chance of assimilating into the community’s economy and then nominate them to IRCC for permanent residency.
Particularly, as compared to other provinces, Ontario has the most PNP allocations. In 2023, the province was allotted an astounding 16,500 nominations, which is almost twice as many as was received in 2022. This significant increase highlights how appealing the province is to newcomers and how well its PNP selects immigrants who will successfully integrate into the economy.
The majority of newcomers to Ontario are in their prime working years
In 2022, Ontario witnessed the arrival of 227,424 immigrants, with 92% of them belonging to the age group under 54, considered as the core working years.
Furthermore, among the recent immigrants in this core working age group, 38.5% had previous work or study experience in Canada, and 80% have post-secondary school qualifications. Compared to long-established immigrants—those who have lived in Canada for more than five years—this is a significant change. According to the data, 66.7% of this group has post-secondary education, while only 5.4% has work or study experience in Canada. The thorough comparison highlights how immigrant backgrounds and educational attainment have changed over time in Ontario.
More than half of the newcomers to Ontario are classified as economic immigrants
According to the report’s results, 43.4% of new immigrants to Ontario in the 1980s were classified as economic immigrants, or skilled workers. This percentage has increased throughout the next few decades, coming in at 51.7%.
Nowadays, the bulk of economic immigrants enter Ontario through the PNP, the Canadian Experience Class (CEC), or the Federal Skilled Worker Program (FSWP), all of which are overseen by Express Entry.
Simultaneously, the percentage of immigrants entering Ontario under family class sponsorship has dropped from 34.3% to 25%. These changes demonstrate how Ontario’s immigrant population is changing, with a greater focus on economic immigration routes and a decline in family-sponsored immigration.
The median wage is on the rise
The research showcases 2020 data that shows those who moved to Ontario with a bachelor’s degree or above made a greater median pay of $61,200 than people who did not have those qualifications. When compared to non-immigrants with comparable educational backgrounds, this group showed the least difference in median wage.
The group of recent immigrants with the highest incomes were those who entered the country via the CEC. Newcomers to the CEC made, on average, $60,100 in their first year of Canadian residency.
On the other hand, one year after admission, the wages of those who arrived through the PNP, the Federal Skilled Trades Program (FSTP), or the FSWP were lower than the median for the general population. According to 2020 data, the median wage for immigrants participating in these programs was less than $43,000 for the given time frame.
Workforce participation
The percentage of recent immigrants who are participating in the work force is rising. According to the report, there was a 13% difference in the participation rate between immigrants and non-immigrants in 2006, but this difference has now closed to 3.5%.
The analysis reveals that, despite the relatively high participation rates, approximately 16% of immigrants with a university degree were underemployed in 2021, working in positions that only required a high school diploma.
The recognition of foreign credentials is highlighted in the research as a major labor market hurdle, especially for licensed professions like those in the healthcare sector, which is experiencing a severe labor shortage.
Furthermore, immigrants in Ontario continued to have a higher unemployment rate than non-immigrants. The average unemployment rate for all core working-age immigrants was 7.4%, which is more than two percentage points higher than the 5.2% average unemployment rate for people who were born in Canada, according to statistics from the research that covers the years 2006 to 2022.
In which industries are newcomers employed?
The research cites statistics from the 2021 census, indicating that 83% of working-age immigrants in Ontario were employed in the services sector.
Moreover, several sectors of the economy showed a greater percentage of immigrants than non-immigrants. It is noteworthy that the distribution of immigrants was 4.2% higher in the professional, scientific, and technical services sector, 3.5% higher in transportation and warehousing, and 3% higher in banking and insurance.
According to the survey, compared to their more established colleagues, recent immigrants are more likely to work in professional occupations. 31.2% of core working-age immigrants who arrived in Ontario between 2016 and 2021 worked in professional occupations, according to Census statistics from 2021. This percentage is greater than the reported 25.5% for immigrants who entered between 2011 and 2015. The thorough analysis clarifies the distribution of immigrants throughout various occupations in Ontario’s different industries.
The majority choose to reside in Toronto
Most recent immigrants to Ontario have chosen to settle in Toronto. The report indicates that a sizable 67% of immigrants selected Toronto as their first choice for settlement in 2021. Furthermore, 82% of newly arrived immigrants in Toronto decide to make the city their permanent home on average, which helps to explain the city’s noticeably higher retention rate when compared to other Ontario cities.
This pattern contributes to the explanation of why most immigrants in Toronto are long-term residents. According to the report, as of 2021, 74.4% of immigrants who arrived in the 1990s were residing in Toronto.
When comparing the proportion of recent versus established immigrants, other Ontario cities with higher recent immigrant percentages included Hamilton (+0.6%), Kitchener-Cambridge-Waterloo (+1.8%), London (+1.5%), and Ottawa-Gatineau (+2.1%).
In spite of this, the data shows a decrease in the percentage of immigrants who choose to settle in Ontario; it peaked at 59.6% in 2017 and then dropped to 36.1%. Nevertheless, in the intervening period, this percentage has risen to 42.5%. The thorough analysis clarifies changes in immigrant preferences within the province as well as patterns of settlement and retention rates.
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