Study: Immigration, low income and income inequality in Canada: What's new in the 2000s?
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Released: 2014-12-15
A new study examines trends in low-income rates among recent immigrants over the last three decades and compares these rates with those of the Canadian-born population.
During the 1980s and 1990s, low-income rates rose among immigrants but fell among the Canadian-born. This pattern changed in the 2000s, when rates fell among both groups. Among new immigrants—those in Canada for five years or less—the low-income rate declined from 39.4% in 2000 to 31.9% in 2010. Over the same period, the rate among immigrants in Canada for 6 to 10 years declined from 35.1% to 27.3%. Immigrant low-income rates fell in every region of Canada except Toronto, where they remained stable. The rates fell the most in Manitoba and Saskatchewan.
In relative terms, the difference in the low-income rates of new immigrants and the Canadian-born population widened through the 1980s and 1990s. In 1980, the low-income rate among new immigrants was 1.4 times that of the Canadian-born, while by 2000 the relative rate was 2.5 times higher. Between 2000 and 2010, the relative low-income rate between these groups changed little and stood at 2.6 at the end of the decade. The major regional exception to this pattern was in Manitoba and Saskatchewan, where in 2010, low-income rates among new immigrants were 1.2 times that of the Canadian-born.
Rising low-income rates among immigrants through the 1980 and 1990s, combined with the growing share of the population composed of immigrants, meant that immigration had a significant impact on the overall low-income rate in Canada. For example, earlier research showed that during the 1990s virtually all of the increase in low-income rates in Montréal, Toronto and Vancouver were related to the rising low-income rates and population shares of immigrants.
However, this changed in the 2000s when, unlike in earlier decades, immigration did not contribute disproportionately to changes in low-income rates at the national level or in Toronto or Montréal. In Vancouver, about three-quarters of the 3.5 percentage-point drop in the low-income rate was attributable to declines in low-income rates and population shares among immigrants in Canada for 15 years or less.
Note to readers
Data
The primary data source used in this study is Statistics Canada's Longitudinal Administrative Databank (LAD). The LAD is a random, 20% sample of the T1 Family File, which is a yearly cross-sectional file of all taxfilers and their families. Immigrants who have entered Canada since 1980 can be identified in this file. Furthermore, information based on immigrant landing records, such as education at entry, age at entry, intended occupation, gender, family status, whether the immigrant speaks English or French at entry, and immigrant class are included in the LAD file for immigrants. All immigrants who filed a return at any time during their tenure in Canada are included in the sample.
Low-income measures
In this study, the low-income measure (LIM) is employed to calculate low-income rates. The LIM is one-half of the median adult-equivalent adjusted family income. A family's income is 'adult-equivalent adjusted' to account for differences in family size. All income figures are expressed in 2010 constant dollars.
The research paper "Immigration, Low Income and Income Inequality in Canada: What's New in the 2000s?" part of the Analytical Studies Branch Research Paper Series (Catalogue number11F0019M), is now available from the Browse by key resource module of our website under Publications.
Similar studies are available in the Update on Social Analysis Research module of our website.
Contact information
For more information contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca).
To enquire about the concepts, methods or data quality of this release, contact Feng Hou at 613-951-4337 (feng.hou@statcan.gc.ca), Social Analysis and Modelling Division.
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