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How language skills predict earnings in Canada

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颁补苍补诲补鈥檚 system requires that all candidates have a minimum language ability corresponding to a level 7, 5, or 4 () under the (CLB) (for English) or the Niveaux de comp茅tence linguistique canadien (NCLC) (for French).

Though Canada has demographic and integration reasons to require that newcomers demonstrate these language abilities, they also act as powerful predictive factors of immigrant success in Canada (which is a key reason why they are included under the (CRS)鈥敯洳共圆够宀光檚 scoring system for assessing immigration candidates).

A recent study by Statistics Canada helped illuminate the effects of language ability on immigrant income, by correlating the scores of approved language tests (for Canadian immigration) with the economic outcomes of immigrants accepted under the Express Entry system, in the years following their landing in Canada.

How is an immigrant鈥檚 language ability assessed under the Express Entry system?

Newcomers under the Express Entry must take approved language tests to determine their ability in at least one of 颁补苍补诲补鈥檚 two official languages (English and French). These tests assess a candidate鈥檚 reading, writing, speaking, and listening abilities in a language.

To be eligible under Express Entry鈥檚 three programs (the (CEC), the (FSWP), and the (FSTP)), candidates must meet different language ability criteria to be eligible for the respective stream:

Under the CEC candidates must receive at least a CLB or NCLC level 7 in all language abilities鈥攊f their job meets a (NOC) Training Education Experience and Responsibilities (TEER) 0 or 1. If their occupation is a NOC TEER level 2 or 3, they must meet a CLB or NCLC level 5 in all language abilities;

Under the FSWP candidates must receive at least a CLB or NCLC level 7 in all language abilities; and

Under the FSTP candidates need a CLB or NCLC level 5 for speaking and listening, and level 4 in reading and writing.

How did differing language abilities impact immigrant success in the years after initial landing?

The study by Statistics Canada found that all four tested language abilities had positive effects on an immigrant鈥檚 income in the years after landing, with the effect increasing as the tested language ability of a newcomer increased (in all four abilities).

Among these language abilities, reading seemed to have the strongest effect on earnings鈥攈owever, the differences between the effect of individual language abilities on earnings were largely the same with little difference between them.

For example, the study found that immigrants with a level 10 (CLB or NCLC) reading ability earned 25% more when compared to immigrants with a level 7. Immigrants with a level 10 listening ability earned 18% more than their level 7 counterparts; increased speaking ability (using the same two levels as a comparison) earned newcomers 19% more while writing ability earned 22% more. The study notes that clear differences in earnings for all abilities only appeared from level 6 or above in each skill, with no noticeable difference between CLB or NCLC levels 5 to 6 in the earnings of newcomers.

However, none of these language abilities, alone or together had predictive ability in determining whether an immigrant could find employment, suggesting that other factors assessed in the CRS likely had a larger impact on finding work in Canada after landing.

How does language ability stack up against other factors assessed under the CRS?

颁补苍补诲补鈥檚 CRS assesses multiple human capital factors of an immigration candidate to determine how successful they are likely to be in settling and integrating into Canadian society. Specifically, these are:

  • Language ability;
  • Pre-landing Canadian work experience;
  • Education; and
  • Age.

According to the results of this study, language ability was one of the most important human capital factors in predicting immigrant success鈥攅ven when compared to other factors.

Specifically, tested language ability was as important as pre-landing Canadian work experience (thought to be the most impactful factor in short-, medium-, and long-term earnings of newcomers). In addition, language ability was found to be 鈥渕uch more important鈥 than education level and age at immigration in predicting the earnings of newcomers in the initial years after landing.

In addition, language abilities helped explain differences in immigrant earnings based on nationality. Though some differences in earnings are usually observable based on an immigrant鈥檚 source country, when language abilities were standardized across these groups, differences in earnings were greatly reduced鈥攊ndicating that much of this difference to begin with could likely be explained by varying proficiencies in English or French.

Language ability was even able to standardize differences in economic outcomes among Express Entry鈥檚 three programs. This is significant, as traditionally CEC candidates tend to perform the best economically in Canada (thought largely to be due to their abundance of pre-landing Canadian work experience, and Canadian education)鈥攈owever when controlling for language ability the difference in earnings between candidates in the CEC, FSTP, and FSWP reduced by two thirds鈥攊ndicating that language ability was again significant in earnings in years after landing.

How can newcomers use this information?

Based on the results of this study, newcomers to Canada would do well to invest heavily into their language abilities鈥攏ot just in establishing writing, reading speaking, and listening capacity, but also in continually developing and refining their language skills鈥攅specially if English or French is their second language. Doing so could have an outsized effect on their earnings shortly after landing in Canada; a result which could subsequently snowball into greater success throughout their Canadian immigration journey.

Notably, the study did have limitations that newcomers may want to consider鈥攕pecifically the focus on Express Entry candidates, and lack of consideration towards (PNP) candidates may skew incomes and effects of language proficiency.

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