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Three new reports shine the light on a global labour market in which talented newcomers aren’t sticking around for a breakthrough job. Canada should worry
The term “flight capital” probably doesn’t mean much to you, but if you have a stake in the GTA economy it should.
Three reports released in the last three weeks underscore the potentially harmful trend of “flight capital” – the loss of skilled immigrant and second-generation labour to competing job markets – and the effect it could have on the Southern Ontario economy.
This week, data from the 2006 census revealed a fact that’s obvious even without the numbers: Many of the youngest neighbourhoods in an aging city with serious labour shortages are dominated by immigrants.
Another report, released by TD, detailed Toronto’s relative economic decline compared with other Canadian cities, such as Calgary. It highlighted the myth of immigrants being the economic panacea for the GTA – an area where, in fact, huge numbers of young immigrants are likely to be unemployed or underemployed and earn considerably less than their non-immigrant counterparts.
And in late June, Catalyst Canada released its comprehensive survey of visible minorities in the Canadian workforce, which revealed a perceived glass ceiling that prevents immigrants and other non-whites from advancing beyond mid-level positions.
In a fluid, mobile global economy that allows the most skilled migrants and their educated children to cherry-pick the best jobs in the world, perception is everything.
“If Canada doesn’t want the brightest computer programmers, science PhDs, doctors and financial experts there are a hundred other countries that do,” says Myer Siemiatycki, director of Ryerson University’s graduate program in immigration and settlement studies.
“Canada is gaining a reputation overseas as a place that’s not as friendly to immigrants as people like to think. And, now, immigrant patterns and opportunities aren’t what they used to be.”
The historical view of newcomers destined to toil for generations before gaining a foothold in their new country has been replaced by what Kenny Zhang, senior research analyst for the Asia Pacific Foundation, calls the signal effect, “which means a person with high human capital probably has a better potential return on that capital (wage) in their home country or their parents’ home country.”
Zhang says that based on his research, “the situation in Canada and other parts of the world is that immigrants are now reassessing their opportunities and moving to other countries or returning to the countries where they came from. Immigrants are much more educated and mobile than in previous times.”
Zhang says 675,000 Canadians have moved to Asia alone – the majority over the last decade – and that figure doesn’t include those who left the country before getting their citizenship.
“The numbers are soaring,” says Don DeVoretz, a professor of economics at Simon Fraser University who has studied the trend of immigrant flight for over 10 years. “Hong Kong, India and the U.S. are the most popular destinations.
“I did a study to find out who is leaving and it’s the best and the brightest, immigrants and those born in Canada. The research shows they do much better than those they left behind.”
“Even (the) Canadian-born are taking advantage of the mobility of the global workplace. “I know a guy, a brilliant guy who lived here and got his PhD. He worked here at the foundation for a few months. He found a job in Toronto, and was very active in the business community, but wasn’t satisfied with the opportunities at his workplace. He went to China and is now the chief investment officer of one of the largest Chinese insurance companies.
“There’s a glass ceiling here, so more and more Canadians are going to India and China, especially. (Those countries are) newcomers in the world market, with huge emerging economies. They’re looking to the diaspora overseas, for people that have been educated in the U.S. or Canada. The opportunities those educated immigrants or second-generation professionals can’t get here are being handed to them in Asia and other parts of the world.”
But Canada, with its declining birth rate and aging population, can’t afford to lose its most talented immigrants and their children, who now dominate professional programs and graduate schools across the country.
“The Bank of Canada has said, in essence, the objective is to let the economy grow in line with its potential,” says Cliff Halliwell, director general of the Ministry of Human Resources and Social Development’s strategic policy research.
“The governor of the Bank of Canada has alluded that slow population growth means the economy can’t expect to grow beyond that. An economy has a speed limit. If output per worker grows by one per cent a year, which is where it’s been, and the labour force grows by about one per cent a year, then the economy can only grow by about two per cent.”
Which is where it has been, rather anaemic compared with the 8 to 10 per cent annual growth of emerging economic superpowers China and India, which happen to be the source of most of this country’s immigrants.
To meet Canada’s one per cent growth rate in the labour force, according to HRSD (formerly HRDC) the government’s goal is to bring in about 230,000 immigrants a year, the equivalent of 0.75 per cent of the country’s overall population. In 2004 239,000 immigrants arrived.
Of those, about 125,000 enter the workforce each year. Meanwhile, last year, 325,000 people left the Canadian workforce, a figure that’s projected to increase drastically as baby boomers retire.
By 2015, the supply of new workers in the labour force coming from the Canadian education system, including those leaving high school and post-secondary studies early, will be about 110,000, more than the number leaving the workforce.
So immigration will provide well over half the new workers in Canada. Yet while Canada desperately needs skilled immigrants, whether it wants them is another question.
“The research suggests visible minorities will represent 50 per cent of Toronto’s population by 2017,” says Deborah Gillis, vice president of Catalyst Inc. a global non-profit organization that promotes the interests of women in the workplace.
With Ryerson, Catalyst conducted a survey of 17,000 employees working for 43 public and privately held companies to find out how visible minorities, many of whom are immigrants to Canada, perceive the workplace here.
“Their perceptions are there’s a lack of fairness and equality. They reported access to fewer high visibility assignments, being looked over for promotions. It’s clear we’re not leveraging the potential contributions of this growing part of the labour force.
“But it’s important to point out that the survey is only reporting perceptions.”
In a competitive, highly mobile global economy that ultimately rewards the best talent, perception may be everything.
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