Economic and Social Reports, December 2023

Six new articles are available in today's release of Economic and Social Reports.

Large differences in homeownership among Canadian-born racialized population groups

Homeownership rates vary across racialized groups, with the greatest differences occurring among young adults. The article "The housing trajectories of Canadian-born racialized population groups," examines trends in homeownership and co-residence with parents among Canadian-born racialized groups by birth cohort from the early 1970s to the early 1990s, based on analyses of data from the 1996, 2001, 2006 and 2016 Census of Population, as well as from the 2011 National Household Survey.

Depending on the birth cohort and age group, the rate of living in an owned home was higher for South Asians and Chinese (5 to 24 percentage points) and lower for Blacks and Latin Americans (3 to 19 percentage points) when compared with Whites. At younger ages, these disparities were primarily due to differences in co-residence with parents and parents' homeownership. When looking at racialized groups in their 20s, the highest rates of co-residence with parents were observed among South Asians (86% to 91%), Chinese (79% to 84%) and Filipinos (82% to 85%). Blacks and Latin Americans in their early 20s were more likely to leave their parental home earlier and were least likely to own their own homes when starting their households. These findings suggest that housing advantages and disadvantages among parents often pass on to the next generation.

Market power widened the gap in labour productivity growth between Canada and the United States after 2001

Both Canada and the United States had average annual labour productivity growth rates of 2.3% from 1961 to 2001, but a large gap emerged after, with the United States growth moderating slightly and Canada's growth falling more sharply. The study "The post-2001 productivity growth divergence between Canada and the United States: The role of the information and cultural services industry," attributes the divergence to weak innovation and investment in information technologies associated with the industries' growing market power.

The study focused on labour productivity growth divergence between Canada and the United States, paying close attention to the information and cultural industries due to their role in Canada's slower labour productivity growth from 2001 to 2019. Information and cultural industries firms operating in Canada, facing less competition, could set higher prices, negatively affecting labour productivity growth. This issue isn't limited to the information and cultural industries, suggesting a more pervasive challenge of weak innovation and investment across the Canadian economy.

Most bachelor's degree programs linked to a large variety of jobs

While the earnings of postsecondary graduates are well documented, little is known about the specific jobs these graduates typically have. The study "Most prevalent jobs of young bachelor's degree graduates by detailed field of study," found that although a small number of bachelor's degree programs were strongly associated with one specific job, such as nursing, pharmacy, and teacher training programs, most programs were linked to a large variety of jobs.

For instance, female design and applied arts graduates were not highly concentrated in their field of study (28.6% worked as graphic designers and illustrators), but many of these graduates landed jobs that are related to the arts such as interior designers and interior decorators (16.0%), industrial designers (4.3%) and theatre, fashion, exhibit and other creative designers (3.9%).

These findings inform students, parents, guidance counsellors and policy analysts on the type of work that graduates are likely to be doing in their career, given their field of study choice. They also highlight the importance for most graduates to develop a wide range of skills that could potentially be used throughout their careers.

Temporary foreign workers in Canada tend to work in low-paying jobs

Temporary foreign workers (TFWs) in Canada are increasingly working in low-paying jobs. In 2019, 45% of TFWs worked in accommodation and food services, and retail trade sectors, as well as administrative and support, waste management, and remediation services sector, a significant rise from 33% in 2010. The study "Foreign workers in Canada: Distribution of paid employment by industry," found that this increase can be attributed to the large expansion of individuals holding International Mobility Program work permits and study permits and the growing trend of international students seeking employment in the aforementioned sectors.

Overall, TFW accounted for 4.3% of all T4 earners in Canada in 2019, up from 2.2% in 2010. Some industry sectors in Canada rely heavily on TFWs. In 2019, they made up 18% of the workforce in the agriculture, forestry, fishing and hunting sector; 11% in the accommodation and food services sector; and 10% in administrative and support, waste management and remediation services sector. Unlike other sectors, the agriculture, forestry, fishing and hunting sector recruited foreign workers primarily through the Temporary Foreign Worker Program. Analyzing the role of TFWs across industrial sectors in Canada helps inform policies and strategies that support Canadian businesses and the well-being of TFWs.

This article is the third in a series that provides updated statistics and insights on TFWs in Canada. For more information, see: Foreign workers in Canada: Work permit holders versus employment income records, 2010 to 2022 and Foreign workers in Canada: Changing composition and employment incidences of work permit holders.

Provincial comparisons in earnings outcomes of provincial nominees

The Provincial Nominee Program (PNP) has become the largest economic immigration program in Canada and the earnings of provincial nominees are important indicators of the ability of the PNP in addressing provincial labour market needs. The study "Provincial Nominee Programs: Recent trends and provincial differences in earnings outcomes," is the first to compare average earnings of PNP immigrants across provinces.

Provincial nominees had much higher earnings in Ontario, Alberta and British Columbia than in Atlantic provinces, Manitoba and Saskatchewan, both in the initial two years and five to six years after landing. After adjusting for immigrants' sociodemographic characteristics and provincial economic conditions, earnings gaps persisted between provinces, ranging from $5,200 to $16,500 in the first two years after immigration. The provincial differences in PNP earnings were much larger than provincial differences in earnings of all Canadian workers and were also different from provincial differences among immigrants in the Federal Skilled Worker Program (FSWP).

Knowledge about earnings differences across immigration programs can help uncover factors that contribute to the relative success of each program. The 2010-to-2014 cohort of provincial nominees earned an annual average of $6,900 more than immigrants in the FSWP during the first two years after immigration. However, the 2015-to-2019 cohort earned $6,500 less annually than their FSWP counterparts. This reversal in entry earnings between provincial nominees and FSWP immigrants was likely related to changes in the selection criteria for FSWP immigrants.

This article is the third in a series that examines various aspects of the PNP. For more information, see: The Provincial Nominee Program: Its expansion in Canada and The Provincial Nominee Program: Retention in province of landing.

Research highlights from the Intergenerational Income Databases

The Intergenerational Income Database (IID), maintained by Statistics Canada for the past 25 years, has been the main source of data on intergenerational income mobility. The article "Intergenerational income mobility in Canada: Research highlights from two recent studies," summarizes two studies that use the IID to compare intergenerational income mobility across several countries and, when paired with census data, examine the effect of parents' education on the incomes of their children.

The estimated rate of intergenerational family income mobility for Canadians born in 1985 was higher than in the United States, lower than in Norway and the United Kingdom, and about the same as in Finland. Graduating from high school may ease the decline in intergenerational income mobility observed in several recent Canadian studies.