Addressing the entrenched issues around newcomer employment in Canada will require systems-level change

Yilmaz E. Dinc

author headshotOverqualification is a common and well-known problem for the immigrant workforce. But the pandemic shed a different light on the issue: the products and services that we consider essential are also provided by immigrants whose talent potential is underutilized.

Immigrant underemployment in Canada is what we at the Conference Board call a “wicked problem” that has been around for decades. Many newcomers in Canada, particularly those without Canadian qualifications and work experience, and those with a background in a regulated profession, face considerable difficulty in finding jobs that match their skillset. They often have to take low-income jobs that don’t use their full skillset just to make ends meet.

Underemployment affects immigrant careers even in the longer term – and nowhere is this effect more pronounced than in essential jobs. A study that we conducted at the Conference Board of Canada last year showed that immigrants are a critical part of the essential workforce, constituting close to one-third of all workers in sectors such as food manufacturing, truck transportation, and nursing and residential care. However, many are overqualified for their roles. For instance, 28% of newcomer transport truck drivers have bachelor’s degrees even though their job doesn’t require one, compared to only 1.6% of their counterparts born in Canada.

What this data tells us is that even though many immigrants are performing essential work, these are often not the right opportunities that build on their talent potential. This in turn limits their earnings and negatively affects their career trajectories. This impact is usually much more pronounced for racialized newcomer workers and newcomer women.

“Underemployment affects immigrant careers even in the longer term – and nowhere is this effect more pronounced than in essential jobs.” 

This phenomenon isn’t only applicable to newcomers. Among people on temporary visas, more than 20% of fish and seafood plant workers and over 30% of labourers in food and beverage processing are overqualified. As Canada welcomes more people with previous experience in Canada and grows its immigration targets, the overqualification question becomes even more prevalent.

The qualifications disconnect is not just an individual-level problem. Canada loses up to $50 billion every year due to employment and earning gaps between immigrants – including essential workers – and people born in Canada.

At the same time, this creates challenges for employers, who continue to report difficulties in talent attraction and retention. Employees who feel overqualified for their role will likely experience lower job satisfaction and be more likely to look for other jobs. It’s worth considering to what extent skills shortages would be addressed by better matching immigrant competencies with labour demand.

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Moving the needle on credential recognition

There are multiple drivers of why overqualification happens. Despite decades of consultations and efforts to improve credential recognition, it remains a complex, costly and time-consuming process for many regulated occupations. However, there are also promising steps being taken in the right direction.

The Government of Ontario has recently removed the Canadian experience barrier for many professions, including electricians, engineers and plumbers. This move will surely help newcomers with a background in these occupations find better-quality job opportunities. Other provinces will likely take note of the results and mirror a similar approach.

However, Ontario’s recent changes did not include health-care occupations, which remain the thorniest part of the problem. Our report found that nurse aides, orderlies and patient support associates were the occupations with the highest degree of overqualification (surpassing farm workers, truck drivers and food manufacturing workers).

The data indicates that licensing internationally educated health professionals should be a government priority at both federal and provincial levels. A March 2022 Toronto Metropolitan University policy brief, for instance, highlighted the need for a “Health Human Resources Strategy” in Ontario that would address the gaps in licensing, seeking alternatives to Canadian experience as well as boosting access to permanent residency.

Tackling bias

The problem, however, does not end with formal credential recognition. Some occupations require further practice but have additional limitations, such as fewer residency spots for internationally educated doctors.

Bias is also an issue. Some employers discount the value of work experience and qualifications obtained abroad. Discrimination against international degrees and experiences, combined with race, gender and ethnicity biases, push many newcomers into difficult essential jobs that people born in Canada don’t want to work in. Groups such as racialized newcomer women end up facing the most complex challenges when it comes to securing quality employment.

The way forward

So, how do we address the overqualification challenge? It won’t be solved overnight, as systems-level change involving multiple actors will take time. In addition to government actions to expedite licensing, employers need to build more inclusive workplaces that help immigrants find jobs matching their skill level and address bias and discrimination.

Employers will also need support from the government, non-profit and settlement sectors to assess foreign work experience and qualifications more effectively and objectively. This is particularly true for smaller businesses.

For many immigrants already underemployed within the system, forming and strengthening upward and cross-sector mobility is critical. That needs to include identifying and building on their transferable skills to help them transition into more skills-commensurate opportunities. Tools such as OpportuNext could help chart those pathways. Reskilling and upskilling might be needed for immigrants whose skillsets are no longer up to date.

As the government and employers work on addressing systems-level challenges, it will be up to settlement and career development practitioners to support overqualified immigrants in pursuing more fitting employment opportunities. This could include identifying sectors with growing employment prospects and helping immigrant workers to assess and rethink their skillsets accordingly. Immigrants may also need guidance on how to diversify their job search as well as when to pursue further qualifications and training to secure skills-commensurate employment.

The pandemic has shown us that Canada relies significantly on immigrants to do the essential jobs, but many newcomers shouldn’t be in these jobs to begin with. We cannot afford to ignore the overqualification challenge if we want to make immigration work better for everyone.

Yilmaz E. Dinc, PhD, is a Senior Research Associate for the Immigration Knowledge Area at The Conference Board of Canada. Dinc brings a decade of experience in applied research, along with his passion for inclusion, to drive thought leadership on immigration. Previously, he worked as Research and Evaluation Manager at the Toronto Region Immigrant Employment Council and in the global private-sector hub of the United Nations Development Programme.