Abstract

In this paper, I examine the wages and work hours of immigrants in Quebec and the rest of Canada. By analyzing data from the Survey of Labour and Income Dynamics (SLID) for the years 1999 to 2011, I explore three key questions about the economic integration of immigrants relative to native-born individuals. The first question examines the initial wage gap for new immigrants, defined as those who have lived in Canada for less than ten years at the time of data collection. The second question assesses whether this wage gap changes significantly over the sample period. The third question examines the extent of economic assimilation in immigrant earnings as their residency in Canada lengthens. The findings reveal a significant initial wage gap, with new immigrants earning 28.8% less than their native counterparts. Over the sample period, this gap narrowed by 1.3% annually. Additionally, the analysis indicates that economic assimilation is substantial, though rates vary between Quebec and the rest
of Canada. Initially, assimilation occurs more quickly in Quebec, whereas over time, immigrant earnings rise more rapidly outside Quebec. To further explore the economic assimilation of immigrants, I investigate their work hours and find that new immigrants work fewer hours than their native counterparts. As with the wage gap, the immigrant-native gap in work hours narrows as immigrants stay longer in Canada. To understand these assimilation effects on both wages and work hours, I analyze a simple model of learning by doing (LBD) and show that the model can account for the key observed patterns of wages and hours worked among immigrants in the SLID.