Two-Step Immigration Processes

A Comparative Analysis of One-Step and Two-Step Immigration Processes in Canada

Canada’s pursuit of economic prosperity through immigration has led to a nuanced exploration of the outcomes of one- and two-step immigration processes. Recent data from Statistics Canada sheds light on the economic trajectories of immigrants, offering valuable insights into the impact of the chosen immigration pathway.

Understanding the Two-Step Immigration Process

In the two-step immigration process, economic immigrants are drawn from the pool of temporary foreign workers (TFWs) and international students with prior Canadian work experience. This stands in contrast to one-step immigrants, who enter Canada as economic immigrants without pre-landing Canadian work or study exposure.

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The significance of pre-landing Canadian work experience has seen a substantial rise, particularly in response to the COVID-19 pandemic.

Economic Disparities: Two-Step Immigrants vs. One-Step Counterparts

The research underscores a consistent pattern: two-step immigrants exhibit higher annual earnings than their one-step counterparts when the evaluation commences from their initial arrival year rather than the year they attain permanent residency.

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Factors Influencing Economic Disparities:

High-Skilled Jobs as TFWs

  • Two-step immigrants who held high-paying/high-skilled jobs during their time as temporary foreign workers outperformed comparable one-step immigrants.
  • Notably, this advantage did not extend uniformly to low-wage or low-skilled two-step immigrants.

Multiple-Selection Process

  • The concept of a multiple-selection process in the two-step method contributes to a more refined match between immigrant skills and labor market demands.
  • Employers can directly assess the skills and intangible qualities of TFWs, resulting in improved post-migration labor market outcomes.

Canada Work Experience Advantage

  • Two-step immigrants benefit from a head start in Canada work experience, a factor strongly linked to enhanced post-migration earnings.
  • This advantage positions them favorably against one-step immigrants without prior exposure to working in Canada.
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Earnings Trends Over Cohorts

The earnings differentials between two-step and one-step immigrants, while persisting, have exhibited some narrowing across successive arrival cohorts. Changes in the types of programs admitting two-step immigrants contributed to this shift.

Program-Specific Trends

FSWP and PNP

  • In the Federal Skilled Worker Program (FSWP) and Provincial Nominee Program (PNP), earnings gaps between two-step and one-step immigrants narrowed from the 2000-to-2009 cohort to the 2010-to-2014 cohort.
  • Further reduction occurred from the 2010-to-2014 cohort to the 2015-to-2019 cohort, driven by the introduction of mandatory pre-migration educational credential assessment in 2013.

Challenges and Considerations

While the two-step immigration process demonstrates positive economic outcomes, challenges and considerations merit attention. Research suggests that low-skilled or low-paying jobs among TFWs may lead to slower earnings growth than one-step immigrants.

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Moreover, an increased presence of TFWs and international students in the labor force raises concerns about substandard working conditions and potential wage suppression for domestic workers.

A Call for In-Depth Examination

The analysis, relying on the Longitudinal Immigration Database, emphasizes the need for a thorough examination of the benefits and potential challenges associated with the two-step immigration selection.

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