Doctors 6X more likely to work outside field than other immigrants

Article content

Few debates about immigration policy conclude without someone talking about foreign-trained doctors being forced to drive taxis. But it’s not a trope, according to new report by economists at Royal Bank of Canada, and adds to evidence that Ottawa’s approach to recruiting newcomers needs an overhaul.

Article content

Immigrants with degrees in the medical field are six times more likely to work in jobs that don’t require their skills than other immigrants, highlighting the degree to which professional designation is a barrier to maximizing talent, Nathan Janzen and Claire Fan showed in a report published Feb. 22.

Article content

Article content

Janzen used the finding to make the case that “poor recognition” of foreign credentials is an important hurdle to better utilizing immigrant skills to boost wealth-enhancing productivity. New Canadians tend to be younger and “more academically accomplished,” yet they do worse when it comes to finding a suitable job, exacerbating the problem of acute labour shortages.

“Having a larger workforce coming into the country … helps to offset some of the impacts of population aging on workforce growth,” said Janzen. “But if we do make better use of those skills, that means a more productive workforce as well.”

Article content

Royal Bank’s contribution to the immigration debate follows a series of public interventions in recent months by Victor Dodig, chief executive of Canadian Imperial Bank of Commerce, who has been urging the federal government to think about immigration holistically, not just in terms of how many newcomers it accepts in a given year. Last week, Dodig upped the ante, telling an audience in Toronto that Prime Minister Justin Trudeau’s decision to significantly increase immigration levels without first shoring up housing supply risks triggering the country’s “largest social crisis” over the next decade unless something is done soon to resolve the issue.

Canada increased its immigration targets last year. Trudeau’s government wants to bring in 465,000 permanent residents in 2023; 485,000 in 2024; and 500,000 in 2025 as it looks to tackle labour shortages. The numbers are higher than last year’s plan, which targeted 447,055 newcomers in 2023 and 451,000 in 2024.

Article content

The federal government said that it is working on introducing new tools this year to better help the immigration system target sectors such as health care and construction that have the highest need for labour.

Janzen said Royal Bank’s view is that some of the labour shortages in the market “won’t really ease” for another decade as a big “wave of the population” of baby boomers hits retirement age, an aspect that leads to more reliance on immigration.

While immigration does play a key role in Canada’s labour supply — accounting for 84 per cent of the growth in the total labour force during the 2010s, according to Statistics Canada — the country’s decision to increase its targets at a time when housing prices are high has been criticized in some quarters.

Janzen, however, said the shortage of housing in Canada was more due to “red tape” than immigration. “It’s tough and expensive to get projects off the ground,” he said. “And if that’s the case, the problem isn’t immigration, the problem is streamlining.”

• Email: nkarim@postmedia.com | Twitter: naimonthefield

Listen to Down to Business for in-depth discussions and insights into the latest in Canadian business, available wherever you get your podcasts. Check out the latest episode below: