The FAO, i.e., the Financial Accountability Office, has released a report stating the recent newcomers are faring well in Ontario’s labor markets. The report explains that the employment outcomes/ results of new permanent residents play an integral role in the province’s economic growth. International immigration to Ontario reached a record of 227,424 in 2022 & is expected to stay high.
According to the report, immigrants have contributed to nearly two-thirds of the increase in Ontario’s workforce since the mid-2010s. The number of immigrants who come to Ontario is driven in part by the federal Immigration Levels Plan. Every year, IRCC sets targets/ objectives for the new permanent residents who will be admitted to the nation. The Plan for 2024-2026 represents that Canada will welcome over 485,000 permanent residents in 2024 & over 500,000 in both 2025 & 2026.
Ontario is the most popular province for immigrants/ newcomers. Some of this can be attributed to the large allocation of nominations the province obtains for its Provincial Nominee Program. PNPs enable provinces to select economic immigrants/ newcomers who will successfully integrate into the provincial economy & nominate them to IRCC for permanent residence.
Ontario obtains the highest number of PNP allocations of any province. Last year, the province had 16,500 allocations, which were almost double the allocations of 2022.
Most Newcomers To Ontario In Their Core Working Years
As recent newcomers are faring well in Ontario’s labor markets, it is vital to note that Ontario welcomed over 227,424 immigrants in 2022. Most of them are within the working age, i.e., under 54 years of age.
Further, over 80% of recent immigrants/ newcomers of core working age have postsecondary education credentials & around 38.5% have Canadian work/ study experience. This is a transition from long-established immigrants. In addition, the data shows that over 66.7% of established immigrants in Ontario have postsecondary credentials & around 5.4% have Canadian study/ work experience.
Over Half Of Ontario’s Newcomers Are Economic Immigrants
The report found that in the 1980s, over 43.4% of newcomers to Ontario were economic immigrants. Well, this number has increased over the past several decades to 51.7%.
Most economic immigrants arrive through an Express Entry program, i.e., FSTP. FSWP & CEC. At the same time, there are fewer immigrants coming to Ontario through family class sponsorship, going from 34.3% to 25%.
Median Wage Is Climbing
The report highlights data from 2020 that demonstrates that those who come to Ontario with a bachelor’s degree or higher were found to earn a higher median wage than those who did not. They experienced the smallest gap in median wage compared to non-immigrants with the same education.
The highest wages for recent immigrants were found to be those who immigrated via the CEC. It was found that, on average, CEC newcomers earned over $60,100 one year after admission to Canada.
Those who arrived via FSWP, FSTP, or PNP had ages below the median wage of the total population one year after admission. Data shows that in 2020, the newcomers in these programs earned a median wage of less than $43,000.
Labor Participation
As recent newcomers are faring well in Ontario’s labor markets, they are also increasing their labor participation rate. The report explains that in 2006, the participation rate for newcomers was 13% lower than it was for non-immigrants & that the gap has narrowed to 3.5%.
While participation rates are comparatively high, the study found that around 16% of newcomers/ immigrants with a university degree were unemployed in 2021 & working in positions that don’t require more than a high school education in 2021.
The report notes that foreign credential recognition is a major labor market barrier for licensed occupations like those in the healthcare industry, which is presently experiencing labor shortages.
Moreover, the unemployment rate of immigrants in Ontario was higher than that of non-immigrants. The report data also explains that between 2006 to 2022, the unemployment rate for all core working-age immigrants averaged 7.4%. This is more than two percentage points higher than the 5.2% average unemployment for Canadian-borns.
What Industries Do Newcomers Work In?
The report quotes 2021 census data, which demonstrates that approximately 83% of working-age immigrants in Ontario were employed in the service sectors.
Other industries with a higher distribution of immigrants than non-immigrants included professional, scientific, technical services, warehousing, transportation, financing, insurance, etc. Moreover, it also found that the number of immigrants holding professional occupations is higher among recent immigrants than established immigrants.
Well, using data from the 2021 Census, the report showed that 31.2% of core working-age immigrants who landed in Ontario in 2016-2021 held professional occupations, which is higher than the 25.5% of immigrants who landed in 2011 – 2015.
Most Settle In Toronto
The highest number of recent immigrants to Ontario chose to settle in Toronto. The study found that 67% of recent immigrants selected Toronto as their new home in 2021 & that, on average, over 82% of newcomers who came to the province choose to stay, implying that Toronto has a far higher retention rate than other Ontario cities.
This helps explain why most immigrants in Toronto are established. It was found that of the established immigrants who landed in the 1990s, over 74.4% lived in Toronto in 2021.
A higher share of recent immigrants compared to established immigrants was found in Ottawa-Gatineau (+2.1%), Kitchener-Cambridge-Waterloo (+1.8%), Hamilton (+0.6%), & London (+1.5%).
Still, the report shows that the number of immigrants who choose to settle in Ontario has declined from a peak of 59.6%. The proportion got as low as 36.1% in 2017 but has continued to rise to 42.5%.