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A Study of Poverty and Working Poverty among Recent Immigrants to Canada

11. Low-income situation of recent immigrants over three consecutive years

In the previous sections we focused on gaining a better understanding of the phenomenon of poverty among recent immigrants in a given year, i.e. in 2004. Since recent immigrants in low income have observable characteristics that are especially favourable to employability, their economic difficulties may be more temporary than those of other low-income Canadians. In this section, poverty among recent immigrants over a longer period of time is examined. The Survey of Labour and Income Dynamics is a longitudinal survey that follows respondents over six consecutive years. However, to maximize the number of observations in the longitudinal sample, a combination of data from the two most recent overlapping panels had to be used, thus limiting the number of years during which the groups of interest could be observed to three (2002-2004).

Compared to other Canadians, recent immigrants are more vulnerable to poverty in both the short and the long term.

Recent immigrants not living in poverty are more likely to fall into poverty in subsequent years than other Canadians.

However, as for other Canadians, poverty among recent immigrants is a very dynamic phenomenon, and the time spent in poverty when they experience it is similar.

The analysis of the low-income status of recent immigrants over three years shows that the proportion of recent immigrants affected by poverty over a three-year period was higher than that observed over a single year. However, the same holds true for adults who are not recent immigrants (14% vs. 9%), suggesting that the risk of a recent immigrant experiencing poverty is more than double that of other Canadians, in both the short and longer terms. Observation of the phenomenon of poverty over a longer period also reveals that, for adults in poverty, the length of time they spend in this situation and the risk of remaining there for an extended period is very similar, regardless of whether or not they are recent immigrants.³²

11.1 Dynamic of poverty among recent immigrants

Many recent immigrants living in poverty do not remain there permanently; on the other hand, those who are not currently living in poverty are not necessarily exempt from it. Between 2002 and 2004, between 7% and 9% of recent immigrants who were not living in poverty in a given year became poor the following year. These entry rates were two to three times higher than those observed for individuals who were not recent immigrants (Table 19). However, during the same period, over 40% of recent immigrants who were living in poverty in a particular year left it the following year; this proportion was not statistically different to that observed for other low-income Canadians (Table 20).

The main reasons why people were able to leave low income between 2002 and 2004 were also very similar for both recent immigrants and those who were not (Table 21). In both groups, some 40% did so primarily because of a change in their family status or environment (reforming a union, child departure, etc.). Others left poverty primarily due to an increase in income of the members of their family (approximately 28% owing to an increase in the own employment income and approximately 31% owing to an increase in family income from other sources (such as transfers, income of other earners, etc.).

11.2 Persistence of poverty among recent immigrants

Among all recent immigrants living in poverty during at least one year between 2002 and 2004, the average period of time spent in this situation was 1.8 years, or more than half of the period under consideration. However, the percentage that remained there for three consecutive years was only 25%, a percentage that was not statistically different from that observed (30%) among other Canadians who experienced poverty during this period. The percentage of recent immigrants in low income who experienced persistent poverty was also fairly similar to that observed among other low-income adults and this, regardless of whether or not they accumulated any hours of work in 2002.

In fact, as the following table shows, the living conditions of recent immigrants experiencing poverty are not substantially different from those of other low-income Canadians. It is true that family support enabled them to obtain a higher average family income between 2002 and 2004, but given that they are part of larger families, this phenomenon did not increase their standard of living in relation to other low-income Canadians.³⁴

³⁰ In this longitudinal analysis, the target population includes all persons aged 18-62 in 2002 (which means that none of them was older than 64 during the period studied) who responded to the survey every year until 2004.

³¹ In this longitudinal analysis, recent immigrants include all persons who reported in 2002 having immigrated to Canada between 1990 and 2002.

³² As it is the case for the incidence of low income in a given year, the incidence of persistent poverty among earlier immigrants is closer to that observed among native-born Canadians than among recent immigrants. Between 2002 and 2004, the proportion of recent immigrants who experienced persistent poverty was 19% while this proportion was 7% among native-born Canadians and 8% among earlier immigrants.

³³ Individuals are said to have experienced persistent poverty if their cumulative after-tax family income was lower than the sum of the associated low-income Cut-offs during the period.

³⁴ Note that the number of longitudinal analyses possible using SLID data is fairly limited given the small number of observations for recent immigrants in the longitudinal sample.