A Comparison of the U.S. and Canadian Immigration Systems
Pia Orrenius and Madeline Zavodny
The views expressed here are here are solely those of the authors and do not reflect those of the Federal Reserve Bank of Dallas or the Federal Reserve System Overview
• Canada and the United States have very different admissions policies • Canada has better-educated and younger immigrants than the United States • Nonetheless, there are concerns about Canadian immigrants’ economic success – These concerns have led to a number of changes in immigration policy in Canada – Early indicators suggest those policy changes are positive
Canada has a higher foreign-born share than the U.S.
25%
21% 20% Canada
15% 13%
10% U.S.
5%
0% 1900-01 1910-11 1920-21 1930-31 1940-41 1950-51 1960-61 1970-71 1980-81 1990-91 2000-01 2010-11
Source: US Census Bureau; Statistics Canada; Canadian data correspond to the year after the U.S. Census Canada admits more permanent residents relative to its population
2.0%
1.5%
Canada
1.0%
0.5% U.S.
0.0% 1940 1950 1960 1970 1980 1990 2000 2010
Source: US Department of Homeland Security and US Census Bureau; Citizenship and Immigration Canada Immigrants are more educated in Canada
Ratio of foreign born share to native born share 3.5
3
2.5
2
1.5
1
0.5
0 Not completed Completed high Some college Bachelor's degree Graduate degree high school or school, no college equivalent Canada US
Source: Calculations based on 2011 American Community Survey (US) and 2011 National Household Survey (Canada); only includes people aged 25 and older Employment-based immigration is more
Other important in Canada
Other Humanitarian
Family-based Humanitarian
Employment- Family-based based or economic
Employment-based or economic
Canada U.S.
Source: U.S. Department of Homeland Security; Citizenship and Immigration Canada; average of new permanent residents over 2009- 2013 for both More new immigrants are in managerial & professional occupations in Canada
Not planning to work or unemployed
Managerial & Managerial & professional professional Not planning Retired to work or Sales, office & unemployed service Sales, office and Trades & service laborers Children & students Children & Retired U.S.students
Trades & laborers
Canada U.S.
Source: U.S. Department of Homeland Security; Citizenship and Immigration Canada; average of new permanent residents over 2008-2012 for both; does not include unknown occupation or “new workers” or entrepreneurs New immigrants to Canada are more likely to be working age
65+
45-64
25-44
15-24
10-14
5-9 Canada U.S.
0-4
60% 40% 20% 0% 20% 40% 60%
Source: U.S. Department of Homeland Security; Citizenship and Immigration Canada; average of new permanent residents over 2008-2012 for both So what’s the catch?
• Canadian immigrants are highly geographically concentrated • Skills don’t necessarily match employers’ needs – Education and experience acquired abroad not highly valued – Concerns about language skills despite point system
Foreign born are geographically concentrated in both countries
Source: Calculations based on 2011 American Community Survey (U.S.) and 2011 National Household Survey (Canada) Mobility rates are lower in Canada Percent moving states or provinces 2.5%
2.0%
1.5%
1.0%
0.5%
0.0% Natives Foreign born Natives Foreign born Canada U.S.
Source: Calculations based on 2011 American Community Survey (U.S.) and 2011 National Household Survey (Canada); among those in country last year, share living in a different state or province this year
Low mobility even among college graduates in Canada
Percent moving states or provinces 3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0.0% Natives Foreign born Natives Foreign born Canada U.S.
Source: Calculations based on 2011 American Community Survey (U.S.) and 2011 National Household Survey (Canada); among those in country last year aged 25 and older with a least a bachelor’s degree, share living in a different state or province this year
Immigrants are more likely to work in STEM occupations in the U.S. Ratio of foreign-born share to native-born share 3
2.5
2
1.5
1
0.5
0 At least bachelor's degree PhD Canada U.S.
Source: Calculations based on 2011 American Community Survey (U.S.) and 2011 National Household Survey (Canada); only includes people aged 25 and older
But Canada relies more on immigrants for STEM workers
% of STEM workers foreign born 70%
60%
50%
40%
30%
20%
10%
0% At least bachelor's degree PhD Canada U.S.
Source: Calculations based on 2011 American Community Survey (U.S.) and 2011 National Household Survey (Canada); only includes people aged 25 and older
How Canada admits economic class immigrants has changed
• Provincial Nominee Programs created in 1990s – Allow provinces to select immigrants – Most nominees have job offers or desired skills – Many nominees not highly educated • Canadian Experience Class created in 2008 – Allows temporary foreign workers and international students to stay – Primarily—but not exclusively—for skilled occupations • Federal Skilled Trades Program created in 2013
Provincial nominees and Canadian experience class are growing in Canada
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Canadian experience class Provincial nominees Skilled workers Entrepreneurs, investors and self-employed Live-in caregivers
Source: Citizenship and Immigration Canada Permanent residents’ destinations are more diverse 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Newfoundland and Labrador Prince Edward Island Nova Scotia New Brunswick Quebec Ontario Manitoba Saskatchewan Alberta British Columbia Territories
Source: Citizenship and Immigration Canada. Numbers for 2013 are preliminary. Use of temporary worker visas has increased faster in Canada
Relative to 2003 level
2.2
2
Canada 1.8
1.6
1.4
U.S. 1.2
1 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: U.S. State Department; Citizenship and Immigration Canada; does not include TN (NAFTA) visas or entries
Skilled workers dominate temporary worker visas in U.S.
Skilled worker share of temporary visas 90% U.S. 80%
70%
60%
50% Canada 40%
30% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: U.S. State Department; Citizenship and Immigration Canada; does not include TN (NAFTA) visas or entries; H-2 visas considered low- skilled in US; LMO visas considered low-skilled in Canada
More permanent residents adjust from temporary visas in U.S.
70%
U.S. 60%
50%
40% Canada 30%
20%
10%
0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: U.S. Department of Homeland Security; Citizenship and Immigration Canada
Share of employment-based principals adjusting from temporary visas has risen
100% U.S. 90%
80%
70%
60%
50%
40% Canada 30%
20%
10%
0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: U.S. Department of Homeland Security; Citizenship and Immigration Canada
Early indicators are positive for new programs in Canada
• Provincial Nominee Program – Good within-province retention rates – Immigrants have high initial earnings & employment rates • Canadian Experience Class – Targeted groups have high initial earnings & employment rates – Also high returns to education & experience Canada’s immigration system is more fluid, flexible
Canada • Increased point system’s emphasis on age, language ability, and job offers; reduced emphasis on education
• Shift in admissions from point system to Provincial Nominee Programs
• Created the Canadian Experience Class • Created the Federal Skilled Trades Program • Overhauled the temporary foreign worker program • Eliminated federal immigrant investor & entrepreneur programs • Launching the Express Entry system in 2015 Canada’s immigration system is more fluid, flexible
Canada U.S. • Increased point system’s emphasis on • Relaxing work rules for spouses of H- age, language ability, and job offers; 1B visa holders if green card reduced emphasis on education application in process
• Shift in admissions from point system • Created Deferred Action for to Provincial Nominee Programs Childhood Arrivals (DACA) program
• Created the Canadian Experience Class • Created the Federal Skilled Trades Program • Overhauled the temporary foreign worker program • Eliminated federal immigrant investor & entrepreneur programs • Launching the Express Entry system in 2015 Canada’s temporary visa programs are more flexible
Canada U.S. • Open permits for International • Almost all temporary foreign workers Mobility Program workers; Temporary tied to employer Foreign Worker Program workers tied to employer
• Spouses of skilled workers can work • Few spouses allowed to work without for any employer; spouses of low- own work visa skilled workers subject to labor market testing
• Few rigid quotas • Quotas for H-1Bs, H-2Bs exhausted every year for a decade • Dual intent allowed for almost all • No dual intent for H-2A or H-2B; visas except seasonal agricultural technically students cannot be dual workers intent • Students can work for up to 3 years • Students receive 12 months OPT after after graduation graduation; 29 months for STEM grads Canada’s labor market testing focuses on temporary, not permanent, immigrants Canada U.S. • Temporary foreign workers require • Labor Condition Application with Labor Market Impact Assessment employer attestation for H-1B visa (LMIA); International Mobility - Prevailing wage requirement Programs do not - “Does not adversely affect wages and - LMIA includes prevailing wage and working conditions” of similar workers recruitment requirements; employers must attest that hiring temporary foreign workers will not result in outsourcing or offshoring • Essentially no labor market testing • Labor certification via PERM for EB-3 for most economic class permanent green cards residents - Recruitment requirements to ensure - Must meet work experience and no U.S. workers who are able, willing, occupation requirements qualified and available - Federal Skilled Trades Program - Prevailing wage requirement requires LMIA - “Does not adversely affect wages and working conditions” of similar workers Backlogs for permanent resident visas are shorter in Canada, but still long
Canada U.S. China China Skilled worker 21 months EB-2 59 months Provincial nominee 25 months EB-3 70 months India India Skilled worker 22 months EB-2 64 months Provincial nominee 16 months EB-3 130 months Philippines Philippines Skilled worker 20 months EB-2 No backlog Provincial nominee 12 months EB-3 41 months Mexico Mexico Skilled worker 33 months EB-2 No backlog Provincial nominee 17 months EB-3 41 months Canadian Experience Class 13 months Lessons from Canada
• A point system may not be the answer • Too early to know whether new programs go far enough – Early indicators on the Provincial Nominee Program are positive – Canadian Experience Class is growing • Importance of policy responsiveness
Top origin countries of permanent residents overlap somewhat
Canada U.S. Philippines 12.1% Mexico 14.6%
China 11.7% China 7.1%
India 10.5% India 6.1%
U.S. 3.8% Philippines 5.3%
UK 3.2% Dominican Republic 4.1%
Pakistan 2.7% Cuba 3.6%
France 2.7% Vietnam 2.9%
Iran 2.5% Colombia 2.3%
South Korea 2.2% South Korea 2.2%
Morocco 1.8% Haiti 2.2%
Source: U.S. Department of Homeland Security; Citizenship and Immigration Canada; average over 2008-2012 for both Top origin countries of all foreign born also overlap somewhat
Canada U.S. China 8.6% Mexico 29.0%
India 8.2% India 6.2%
UK 7.9% China 5.6%
Source: 2011 American Community Survey (for U.S.); 2011 National Household Survey (for Canada) Foreign born as a whole slightly more likely to work in managerial & professional occupations in Canada Managerial & professional
Managerial & Unemployed or professional Unemployed or not not in labor in labor force force Services, office Services, office & service & service
Retired Retired Trades & laborers Trades & laborers Children & Children & students students Canada U.S.
Source: Calculations based on 2011 American Community Survey (U.S.) and 2011 National Household Survey (Canada) Foreign born are geographically concentrated in both countries