(Ottawa) The income gap between Canada’s new immigrants and other Canadian workers has narrowed considerably, says a new report from the Parliamentary Budget Officer (PBO) on Friday.
The report found that in 2018, new immigrants – or those who have been permanent residents for only a year – had a median income equivalent to about 78% of the income earned by all taxpayers. In 2014, this percentage was around 55%.
The PBO says trends that coincide with this shift include more work experience in Canada, greater immigration from South Asia and closer family ties to the country.
The report also found that new immigrants in engineering and applied science occupations in particular made significant gains.
The PBO estimates that if the income gap were completely eliminated, productivity growth in Canada could increase by up to 0.21 percentage points.
The Liberal government has increased its annual immigration targets and plans to welcome 500,000 immigrants in 2025 and 2026, nearly double the number admitted in 2015. The PBO said its report was intended to “inform expectations” regarding this policy change.
The report in question indicates that substantially increasing immigration targets will grow the Canadian economy in the long term by increasing the workforce.
“The benefit for the current population remains uncertain, particularly in the short and medium term when new arrivals must be integrated into the economy,” says the report.