Executive summary
Canada has not only the largest in terms of numbers, but also the most elaborate and longest-standing skilled labour migration system in the OECD. Largely as a result of many decades of managed labour migration, more than one in five people in Canada is foreign-born, one of the highest shares in the OECD. 60% of Canada’s foreign-born population are highly educated, the highest percentage OECD-wide. A broad range of settlement services for labour migrants and their families, both pre- and post-arrival, complement the system and overall integration outcomes of migrants and their native-born children are better than in most other OECD countries. Against this backdrop, Canada is widely seen as a role model for successful migration management.
Canada’s permanent migration system is based on a rolling three-year plan, with an annual intake of over 320 000 individuals in 2018, about 0.9% of its population. The plan balances economic migration – labour migrants and their families – with family and humanitarian migration, serving a broad range of economic, demographic and humanitarian objectives. Intake planning for labour migrants – which together with their families account for almost 60% of the total – includes a range of annual admissions for the total and the main category, and sets targets for federal and regionally selected migrants.
In 2015, Canada introduced Express Entry, a dynamic two-step “Expression of Interest” system for labour migration. The new system for permanent labour migration selects among eligible candidates from a pool about every other week, inviting the highest ranked candidates to apply for permanent residency until reaching a pre-defined number of invitations. To enter the pool, candidates must meet various minimum criteria for one of three federal programmes managed by the system. If successful, they are ranked against one another based on a comprehensive ranking system. A unique feature of the Canadian model, in contrast to other Expression of Interest systems in New Zealand and Australia, is the degree of refinement in the ranking system. This allows consideration of positive interactions of skills, such as that between language proficiency and the ability to transfer foreign qualifications to the Canadian context. The system is built on an in-depth assessment of the drivers of outcomes of previous migrants.
Canada is highly reactive to new developments, and changes in policy governing migration are not only rather frequent but also more strongly evidence-based than elsewhere. For example, monitoring the composition of invited candidates following the implementation of Express Entry has already led to two major reforms of the system. These reforms addressed several initial shortcomings, such as the too high points attributed for a job offer, which led to a high intake of lesser-skilled migrants working in the hospitality sector. The system now puts more value on human capital factors (e.g. education, knowledge of English and/or French) as these are related with better labour market outcomes. Policy innovations build on a strong foundation of in-house research and evaluation of programmes and outcomes, coupled with one of the most comprehensive data infrastructures on migrants in the OECD.
The Express Entry system selects not only those with the highest potential, but also allows for ministerial discretion to address political priorities in selection, for example by providing bonus points. However, as many candidates are clustered in a narrow range of points, slight changes in points allocation can drastically alter the selection. Ministerial discretion should thus be used parsimoniously and be evidence-based, with transparency about the underlying objectives.
A key issue in the system is that requirements for pool entry differ from the criteria used in the universal points’ allocation within, and thus selection from, the pool. The three programmes currently managed via Express Entry were designed prior to its implementation, and the entry criteria for the pool are thus not well-aligned with its selection criteria. There are also some inconsistencies in the system, with candidates from the mostly onshore Canadian Experience Class being eligible with lower language skills than those coming from abroad through the Federal Skilled Worker Program. What is more, there are very few admissions through the Federal Skilled Trades programme, with cooks accounting for a large part of these. Most tradespeople are admitted through other streams, and the programme currently mainly serves migration in a few occupations where shortages are not necessarily present, which contrasts with its original objectives. Providing for a single entry grid based on the core criteria for ultimate selection would simplify the system and ensure common standards.
In an admission system such as Canada’s, which places heavy emphasis on formal qualifications through its points allocation, a key challenge is the recognition of foreign qualifications, and this challenge is exacerbated by the country’s federal nature. Recognition is a provincial competence, and provinces have different practices. This is a particular issue in ‘regulated occupations’, such as doctors and nurses, where licensing is required for the exercising of the profession. While Express Entry candidates have their language proficiency tested and their foreign education certified prior to their selection, quite often an assessment – and potential upgrading – of occupation-specific qualifications is still necessary. These issues can lead to a situation where migrants are selected based on their skills but in reality cannot then exercise them. To this end, in addition to better informing potential migrants about this issue, Canada should further enhance communication and data sharing among the different stakeholders involved and add incentives within the system itself to encourage migrants to initiate the licensing process before landing and/or introduce a specific visa for foreign credentials’ recognition.
A distinguishing feature of the Canadian system is its clear separation of permanent and temporary labour migration streams. However, over the past decade, the share of onshore transitions among total admissions has increased two-fold, and these now account for about half of new labour migrants. This share is likely to increase further due to the continuously growing role of provinces and territories in selecting migrants – who in about three-quarters of cases select those already in Canada – as well as the Express Entry system, which rewards previous Canadian study, in addition to Canadian work experience.
An exception to the clear separation of temporary and permanent migration is the caregiver programme, which has a built-in two-step form of migration, making it very attractive for caregivers compared with provisions in other countries. However, most caregivers in Canada leave the occupation within a few years after admission for permanent residence, as the latter allows for occupational mobility. A longer required residence prior to transition could thus be considered as an option for limiting the need for constant high intakes in this category.
The number of temporary foreign workers is increasing, though this group contribute a smaller share to the labour force (about 1.1%) than in other settlement countries. Temporary labour migration is constituted of two streams. The first is the Temporary Foreign Worker Program, which admits foreign workers to meet specific shortages in the labour market, is rather tightly managed and labour market-tested. The burdensome procedure for temporary labour migration, especially for those migrants who are paid above the provincial average, encourages labour migration that might otherwise be temporary to pass through permanent streams. In addition, there are no facilitations for renewal of permits. Although the recent implementation of Canada’s new Global Skills Strategy provides simpler and faster procedures for some subgroups, the overall set-up remains complex and simplification should be considered, notably for renewals.
The second component is the International Mobility Program, which admits temporary migrants with work rights, primarily for a range of other objectives mostly associated with international business and co-operation, such as youth mobility schemes and intra-corporate transfers, as well as post-graduate employment. Whereas the tightly managed Temporary Foreign Worker Program has continuously declined over the past decade, there has been strong growth in such international mobility. In contrast to the Temporary Foreign Worker Program where most permits are employer and occupation-specific, the bulk of beneficiaries of international mobility obtain open work permits and information on their intended occupation and destination is often missing. This hampers both monitoring and assessment of the labour market impact. First steps toward better monitoring have been taken, and it is important to continue along those lines.
However, the single largest and fastest growing component of international mobility is the international graduates group, who work under a post-graduation permit. Initial permits to these individuals have increased five-fold over the past five years. Indeed, among major OECD recipient countries, Canada has been the fastest growing destination for international students, whose numbers almost tripled between 2008 and 2018. International students can work during their studies and stay for up to three years in the country on a post-graduation permit. Due to the requirement of at least one year of skilled work experience for admission, direct transitions from international students to permanent residency are rare, but later onward transitions are increasingly common.
Permanent labour migration is a shared responsibility between the federal and the provincial and territorial (PT) governments. The increased role played by provincial and territorial governments in selection and integration has resulted in a more balanced geographic distribution of permanent labour migrants across the country over the past two decades. As permanent migrants enjoy free mobility across Canada, the rather high retention rate of PT-selected labour migrants and their different skill profile suggest that PT-streams are indeed complementary to the federal programmes. What is more, short-to-mid-term labour market outcomes of PT-selected migrants to date tend to be largely favourable, with a few exceptions. However, given the large growth in PT-selected migration and the fact that some programmes are not very selective (with some evidence that the less successful migrate to other provinces) a continuous monitoring seems warranted to be able to react if the current rather favourable assessment were to change.
In addition to their own programmes, PTs can also nominate a certain number of migrants from the Express Entry pool, ensuring their timely selection and priority processing. A way to ensure that selection of provincial nominees remains consistent with overall Canadian skill needs would be to direct future growth in the programme through Express Entry. In turn, a provincial temporary foreign worker pilot should be considered. This would allow PTs to better respond to regional cyclical or seasonal labour needs that are currently not met otherwise, without the need to resort to permanent migration through provincial nomination.
Most of the provincial nominees – like their federally selected counterparts – settle in metropolitan and agglomeration areas, a development that Canada is currently addressing with a new rural community-driven programme, with an accompanying whole-of-family approach to integration, designed to enhance retention. Indeed, Canada has been at the forefront of testing new, holistic approaches to manage labour migration and to link it with settlement services, especially in areas with demographic challenges such as the Atlantic Provinces. The Atlantic Immigration Pilot, for example, provides a rather holistic approach by linking attraction and retention through measures such as six-month priority processing, support for employers, and significant settlement support for the entire family with personalised settlement plans.
In summary, Canada has been largely successful in managing labour migration. Core to this success is not only the elaborate selection system itself, but also the innovation and infrastructure around it, which ensures constant testing, monitoring and adaptation of its parameters. This includes a comprehensive and constantly improving data infrastructure, the capacity to analyse such data, and subsequent swift policy reaction to new evidence and emerging challenges.