Policy Brief No. 9 - A Canada-US Comparison of the Wage Gap for Highly Educated Immigrants

This policy brief focuses on changes in the wages of university educated new immigrants over the 1980-2005 period in Canada and the United States. Generally speaking, wage outcomes for this group were superior in the U.S. Wages of university educated new immigrants relative to domestic born university graduates declined in Canada over that period but rose in the United States. Also, the university wage premium — the difference in the wages of the university and high school educated — for new immigrants was similar in both countries in 1980, but rose over the next two decades in the United States while staying fairly static in Canada. The vast majority of this difference occurred in the 1990s, and coincided with a larger influx of immigrants to Canada than the United States, relative to the 1980s levels, and more of them arriving with degrees. The paper discusses a number of possible reasons for this divergence in immigrant wages between the two countries