Taxi Driver Syndrome

Behind-the-scenes immigration changes are creating new problems on top of old ones.

Are immigrant professionals still driving taxis?

The answer is yes. They are also mopping floors, bagging groceries, guarding office buildings, delivering pizzas, waiting tables and working at call centres. Once in Canada, many skilled immigrants, particularly those with Indian, Caribbean, Chinese or Arab backgrounds, wind up in occupations far below their educational levels—despite having been selected for high levels of training and experience in professions such as health care, engineering and education. The problem is known as “brain waste” and some economists estimate its cost to Canada as totalling at least $3 billion a year, not to mention the ruined dreams suffered by the immigrants themselves. Countless organizations have experimented with solutions to this underemployment, with only modest effect. Now the federal government is weighing in—or, depending on your perspective, backing off—and radically changing who is arriving in Canada and what this country expects of them.

Most alert Canadians, if you asked them, would say that we receive our immigrants through three streams: an economic one, based on our vaunted points system that gives high marks to education; a kinship one, the “family reunification” program; and a humanitarian one, our refugee acceptance program. These same alert citizens would add that all three immigration programs are run out of Ottawa by the federal government.

But major shifts, especially to the economic class of immigrants, have been occurring in recent years, virtually all of them taking place without public debate or parliamentary approval. We are opening the doors to more and more temporary workers (it used to be only nannies and tightly controlled seasonal workers in agriculture); we are pinpointing 29 specific occupations for exclusive eligibility under the federal skilled worker program; and we are devolving the selection of immigrants from Ottawa to the provinces at a very rapid rate (provincial “nominees” numbered just 477 when the program began in 1999 and by 2008 a total of 22,411 immigrants entered Canada this way).

Because of the “taxi driver syndrome” faced by highly skilled and educated immigrants under the “old” system, these new, more “practical” approaches to immigration are quickly finding favour with the country’s business class, in provincial capitals and, it would seem, in the Prime Minister’s Office. But before we go too far down that road, already paved by the Australians and many western European countries, it would be wise to take a look at how our economic immigrants are faring. Difficult as it may be to accept, the most comprehensive research indicates that in the long run we are far better off as a country continuing to bring in the most highly educated and skilled immigrants we can attract from around the globe.

Barriers to employment success for immigrant professionals in Canada are several and they are not new: employers’ lack of familiarity with foreign qualifications, professional licensing procedures set up with Canadian qualifications in mind, immigrants’ lack of professional connections, their unfamiliarity with professional and business lingo in Canada and, of course, their lack of “Canadian experience.” All these have effects intertwined with the impact of racial and cultural difference.

And there have certainly been attempts to ameliorate these concerns. There have been the striking TV ads urging employers to wise up and make use of valuable immigrant skills. Government and business programs seem to have sprung up everywhere to help immigrants breach the myriad of employment barriers. Ontario has regulations to ensure immigrants have fair access to professional licensing. There is now an impressive array of agencies providing credential assessment and recognition, bridge training programs to top up foreign-acquired skills and give immigrants Canadian work experience, and mentorship systems to help immigrants network with professionals in their field, to say nothing of websites crammed with helpful advice for newcomers.

And there is evidence that some of these efforts have begun to bear fruit, at least for immigrants in certain occupational fields. Consider foreign credential assessment. This is among the most noteworthy of government initiatives, and credential assessment services now exist in virtually every province in Canada. World Education Services, established in Ontario with a government mandate and start-up subsidy, now operates as an independent business and prepares 10,000 assessment reports annually. In Quebec, the provincial government provides the service. In British Columbia, an educational institution is most prominent. And the federal government has a multi-million dollar program to develop the concept further. The assessments focus on the equivalencies between the immigrant’s training and the training undergone by Canadian-educated professionals; and their positive impact must be significant since immigrants (at least in Ontario) are prepared to pay $115 for the most basic evaluation and more than double that figure for a more detailed assessment.

Among community groups, one of the leaders in promoting immigrant skill utilization is the Toronto Region Immigrant Employment Council. TRIEC annual reports show the range of initiatives and provide some numerical assessment of impact. In 2009, for example, it reported that its mentoring partnership program matched 5,000 skilled immigrants with Canadian professional mentors. Career Bridge internships, which TRIEC helped initiate, provided 1,300 skilled immigrants with Canadian experience, and 600 skilled immigrants made connections through multiple networking events. Buoyed by these successes, the TRIEC model has diffused across Canada.

Given all this, has there been significant progress toward better use of immigrant skills? A review of all the available evidence suggests that, sadly, all those efforts to address immigrant brain waste are too small and inadequate in magnitude to make more than a small dent in the overall problem. Although the programs are hard to assess because they lack formal evaluation studies, they are certainly worthy initiatives. But they simply do not add up to the kind of dramatic labour market shift that is required. And at the same time, the skill level of immigrants has risen significantly, magnifying the scale of the problem. If anything, the problem of immigrant employment in Canada has become more difficult over time, and is more serious today than it was when it was first identified in the 1990s.

To see this big picture, we need to look beyond the program brochures, websites and success stories, and go back to immigrant employment statistics that established the significance of the problem in the first place. These statistics, based on surveys of the entire labour force such as the periodic census, allow us to see how the earnings of immigrants are typically affected by their relative lack of access to occupations at skill levels where native-born Canadians with equivalent qualifications are working. The numbers clearly still show a pattern of substantial, continuing and, to some extent, worsening immigrant disadvantage.

In 1996 census data, it was estimated that immigrant skill under-utilization cost the Canadian economy $3.1 billion (in today’s dollars). This cost was measured by assessing earnings losses to immigrants because of working in occupations below the skill levels where comparably qualified native-born Canadians are working. If, for example, a foreign-trained doctor was working as a checkout clerk, the “cost” would be the difference between those minimum-wage earnings and those of a Canadian-trained physician. The rough magnitude of this effect was corroborated in a study conducted by The Conference Board of Canada and has been cited frequently.

What has happened since 1996? We have had two censuses since then, in 2001 and 2006, and since programs have been implemented at least during the latter part of this period, we might expect to have seen some impact by 2006. Throughout this period, Canada significantly increased the emphasis on education in the selection of immigrants. As a result, the proportions of immigrants with bachelor’s degrees nearly doubled from about 25 percent in the early 1990s to about 45 percent in the most recent period. Overall, the educational level of Canada’s immigrants has risen much more rapidly than for the native born. However, despite having gained substantially in relative skill level since the mid 1990s, the proportion of immigrants in the more highly paid occupations that use those skills, such as in science, engineering or nursing, is only marginally higher, and their relative earnings have remained unchanged.

A close look at trends between 1996 and 2006 also shows that the value of immigrant skills has not shown significant improvement over time. In fact there appears to have been a relative decline, even in the most recent period when one might have expected some of the programs to begin to have an effect. The 2006 census data show that immigrant skills in terms of both education and work experience have only about two thirds of the value of corresponding skills among native-born Canadian workers, and occupational underemployment is a significant reason.

Immigrants with university degrees might be expected to have benefitted most from the new programs, but between 1996 and 2006 their proportion working in professional or semi-professional fields actually declined, from 53 percent to 51 percent. And at the same time the proportions of these highly skilled immigrants working in low-skilled occupations increased relative to their native-born counterparts. In 1996, the proportion was about 75 percent higher for immigrants, but in 2001 it was 130 percent higher, and in 2006 almost 160 percent higher. So despite attention to their plight, highly educated immigrants have been falling further behind.

There are many reasons why barriers persist. One is the sheer complexity of the problem. Each Canadian professional group—be it doctors, engineers or accountants—has its own specific qualifications and evaluation procedures, requiring special attention to questions of quality and assessment. And there are many more occupations outside the regulated professions where analytical and problem-solving skills are sought, and where education plays an increasing role as a qualifying criterion—jobs such as sales supervision, human resource management or public relations—and in those occupations addressing barriers to foreign-acquired skills poses even greater organizational challenges. Because of the relative lack of systematic standards in many unregulated fields, it is more difficult for immigrants to demonstrate the value of their specific skills. While the economic loss for immigrants with professional qualifications is significant, the loss is actually even more significant for immigrants with a university bachelor’s degree but no higher professional certification. Small or medium-sized firms, which represent the majority of employers in Canada, often lack formal human resources facilities. As a result, they may be less systematic in their approach to job applicants, and less able to provide formal opportunities for immigrants to demonstrate the equivalence of their skills. When they fail to get occupations for which they have specific qualification, they may experience even more barriers at lower levels, often being dismissed as “overqualified,” and find themselves obliged to take jobs for which there are virtually no skill requirements whatever. This is a major reason why immigrants more often wind up at the very bottom of the skill hierarchy.

Another source of resistance to change is the factor of racial and cultural difference. It is well known that assessment of qualifications or professional competence is affected by social characteristics and these include race and national origin as well as gender, age and other individual qualities, such as height and physical attractiveness. When the discounting of immigrant qualifications disproportionately affects visible minorities, as it clearly does in Canada, it is an instance of racial discrimination.

The discriminatory aspect of immigrant underemployment is clearly illustrated in cases that have come before the Canadian Human Rights Commission. In a tribunal finding at Health Canada in 1997, denigration of minority qualifications was one of the key pieces of evidence. The view that ethnic minorities may possess technical qualification but often lack “soft skills,” such as communication and decision-making perspective, was found to play a significant role in their low rates of promotion to management. Another tribunal decided that racial discrimination also may be involved when a minority immigrant job candidate is rejected on the basis of being overqualified. Immigrants encounter the complaint that they are overqualified almost as often as the complaint about lacking Canadian experience. Such decisions are sometimes defended as standard human resource practice, but the fact that immigrants are so often rejected for jobs for which they are qualified on paper means they must turn to lower level jobs, where they are vulnerable to the complaint that they are overqualified. Because of this, a human rights tribunal found the practice of rejecting immigrants as overqualified to be discriminatory.

Given this entire immigrant employment situation, and the intractability of the problem of skill recognition, it might seem reasonable to conclude that it is time for a complete change. Perhaps it is not necessary for immigrants to be so highly skilled; perhaps we really need fewer immigrants of any kind. However, it should be remembered that despite the problems of immigrant employment, compared to other countries Canada’s immigration program has been actually quite successful. There are many reasons why quick changes redirecting Canada’s entire immigration program would be very short-sighted.

Changes in immigrant selection, emphasizing immediate labour market connections and directing priority away from the most highly skilled immigrants, appear to underlie some of the policy changes made by the Conservative government led by Prime Minister Stephen Harper, who took office in 2006. Several initiatives have the objective to help get immigrants into employment more quickly. First, there has been a shift in selection criteria away from formal education toward greater emphasis on official-language knowledge and experience in particular occupational categories in current demand, professional fields such as medicine, dentistry and nursing, to be sure, but also crane operators, drillers and blasters, and heavy-duty equipment mechanics. Second, use of temporary rather than permanent foreign workers has increased sharply, and there are new opportunities through something called the Canadian Experience Class for successful temporary workers to gain permanent status. Third, there is that increased role for provinces to nominate as immigrants those they believe will contribute most to local needs.

Many recent policy changes in Canada are modelled on similar changes in Australian immigration policy introduced by John Howard’s government about ten years ago, and for which successes have been claimed. However, recent employment statistics from Australia show that bringing in more less-skilled temporary immigrants, and opening avenues for them to become permanent residents, appears not to have improved the employment status of immigrants in that country even in the medium term. Less-skilled immigrants originally admitted on temporary visas with prearranged jobs obviously have higher employment rates at the moment of arrival, but within a fairly short time it is immigrants with advanced education who actually have higher employment rates. In the medium to long term, it is they and their families who integrate more effectively into society. And while experimenting with less skilled immigration, Australia’s immigration program has still maintained its high-skill emphasis, and in fact trends show it has increased it.

Reliance on temporary immigration on a large scale will bring its own set of problems. Temporary foreign workers who qualify for the Canadian Experience Class may have relatively low levels of formal education. Those who do not qualify will be even less educated, and although their formal opportunity to remain in Canada is limited, experience shows that many such workers will overstay their visas and in effect become permanent undocumented or “non-status” immigrants. The Americans have learned a great deal about this problem, at a cost. Trying to enforce residency requirements is almost impossible as individuals go underground. What are the chances of integrating low-skilled non-status immigrants successfully into Canadian society? Their numbers are clearly hard to compute, but given the dramatic increases in temporary foreign workers in Canada, it seems likely that the potential undocumented population, on a per capita basis, is now growing faster than it is in the United States. Increases in non-status immigrants represent a looming potential shadow over our entire immigration program, especially in the provinces of Ontario, British Columbia, Quebec and Alberta, which have been the destinations for most temporary immigrants.

Clearly, moving quickly away from our traditional emphasis on formal education may bring more problems than it solves. Notwithstanding the difficulties that skilled immigrants face, all the evidence not only in Canada but elsewhere confirms that the highly skilled have more labour market success than less-skilled immigrants. Although many highly educated immigrants experience employment frustration over long periods, the statistics consistently show that they do better than less-educated and unskilled immigrants. Many of the well educated actually do ultimately go on to achieve a significant degree of success in Canada. As already noted, in 2006, over half of university-educated immigrants worked in professional or semi-professional fields, and another 23 percent worked as managers, as supervisors or in other skilled occupations. Highly educated immigrants are the hallmark of the success of Canadian immigration, and in the long run these immigrants will always become more successful than those without formal education. Their skills mean they have greater ability to adapt to disappointment and create new opportunities for themselves even when their skills are not recognized.

To illustrate this, it is useful to look more closely at some of the individual immigrant success stories. In 2009 and 2010, Canadian Immigrant magazine, a periodical serving immigrant communities across the country, conducted a “top 25 immigrants” awards competition, based on reader balloting to select immigrants who have overall contributed most to Canadian society. The 50 recognized so far include many well-known personalities, for example B.C. politician Ujjal Dosanjh, filmmaker Deepa Mehta and former governor general Michaëlle Jean. Virtually all of the top immigrants became successful based on some form of post-secondary education—a notable exception being Olympic athlete Donovan Bailey. And it is striking that only a very tiny minority actually did so by having their foreign qualifications recognized in Canada. Many, like another former governor general, Adrienne Clarkson, CBC news anchor Ian Hanomansing and a number of scientists and other professionals, immigrated at a fairly young age and received their education within Canada.

However, among those with foreign education, only a handful, mostly in the medical field, were successful because of straightforward recognition of their foreign qualifications by employers in Canada. Their biographies make this very clear, and many experienced frustration and disappointment. For the rest, the vast majority, success ultimately was possible because these immigrants used their developed skills and abilities either to start an independent business or through community involvement and participation. One illustrative example is financier Hari B. Varshney, a certified accountant whose business projects include one of the largest diamond mines in the Northwest Territories, and who has contributed extensively to education and other projects in his community. Another is Martha Lucia Niño of Milton, Ontario, a former lawyer from Colombia, who created Abanico Magazine, aimed at the Canadian Hispanic community. There are many other such stories. Most of the “top 25” stories for 2009 and 2010 illustrate that while highly skilled immigrants experience barriers, many also possess the personal resources to reinvent themselves and that is how many of the most successful immigrants make it. Most of those who were born and educated abroad were successful because of their skills and despite not having those skills formally recognized.

The point here is that even while credential recognition is needed, immigrants with high levels of education are extremely valuable to Canada and do achieve a degree of success; some go on to become leading Canadians. And the beneficial impact of their high levels of education is felt also in their children, whose educational success in Canada has been truly spectacular, and who are now a critical part of our young professional workforce. The experience of other countries with less-educated immigrants, countries such as the United States, the Netherlands, France and Germany, is that the second generation has lower educational outcomes and become part of more or less permanently marginal ethnic enclaves.

So the solution to the employment frustration of highly educated immigrants is not to turn to less-skilled immigrants; it is, rather, to continue to welcome the highly skilled and to work to ensure that their skills and training can be used more readily in the Canadian labour market. The need for high skills in the Canadian workforce has been demonstrated many times, based on the rising labour market premium placed on post-secondary education. The most recent study was released last fall by economics professor Torben Drewes at Trent University. The rising earnings gap by levels of education implies more demand for skilled workers. As Drewes notes, following the traditional law of supply and demand, one can measure the demand for something by looking at the price it commands. “If there is an excess supply of these types of skills, the price should fall. The opposite is happening.” There is no question that the Canadian labour market continues to need highly educated immigrants.

Rather than rapidly shifting from highly educated immigrants to those who are less skilled and to temporary immigrants in programs well known to have created problems in other countries, Canada would be well advised to return to a more intense focus on making the best possible use of our well-educated immigrants’ skills.

Alan Broadbent, a member of the LRC’s board of directors, is chair of Maytree, a founder and continuing supporter of TRIEC.