Personal Networks and the Economic Adjustment of Immigrants

(Published in Canadian Social Trends on Nov. 30, 2011.)

Recent immigrants are highly educated but have more difficulty finding well-paying jobs than immigrants who have been in Canada longer and their Canadian-born counterparts.

Social capital, combined with human capital factors like education and work experience, can explain some of the employment and income differences between new immigrants and other Canadians, according to the 2011 Statistics Canada report “Personal networks and the economic adjustment of immigrants.”

Social capital, the personal networks an individual is able to mobilize in his own economic interest, hasn’t been studied as much as human capital in relation to the economic success of immigrants.

This report examines data gathered in Statistics Canada’s 2008 General Social Survey, which collected cross-sectional data on the personal networks of a broad range of Canadian-born and immigrant adults and found knowing people in 10 or more different occupations increases an immigrant’s chances of being employed and earning more money.

Analysis

Immigrants had smaller and less diverse social networks: Individuals born in Canada had an average of 49 relatives and friends in their networks, compared to 41 for immigrants. Immigrants were also less likely to be a member of, or participate in, an organization or association, especially professional associations (57 per cent of immigrants were involved in at least one group, compared to 67 per cent of Canadian-born). Also, immigrants’ networks were less diverse, with immigrants knowing at least one person in nine different occupations, while those born in Canada knew someone in 11 different occupations.

Social networks of immigrants differed according to time in Canada: Immigrants seemed to build more diverse networks the longer they lived in Canada and were more likely to belong to at least one organization, association or club if they had been in Canada for 10 years or more. While the overall size of their networks were the same for recent immigrants and those who had lived here for 10 or more years, immigrants knew more people in their city of residence the longer they were in Canada.

Employment among immigrants was associated with social network diversity: The occupational diversity, but not the size nor the closeness, of someone’s personal network was associated with the likelihood that they were employed.

The report calculates the probability of employment is about 92 per cent for a 40-year-old, Canadian-born, married man with a college diploma who lives in a major city and whose first language is not English or French and who is a visible minority. (This calculation does not take into consideration the size or diversity of the man’s social network.)

The probability of employment for an immigrant, with the exact same characteristics as the Canadian-born man and who has been in Canada for less than five years, is 84 per cent. This increases slightly to 85 per cent for those in Canada five to nine years and to 92 per cent for those in Canada 10 years or more.

When only those individuals who have a social network that includes people who work in 10 different occupations, the probability of employment for the Canadian-born remains the same at 92 per cent but increases to 88 per cent for immigrants in Canada less than five years, 87 per cent for immigrants in Canada five to nine years and 93 per cent for those in Canada 10 years or more.

Social networks and personal income: When looking at personal networks, only the occupational diversity of workers’ contacts was associated with their annual income. For each additional occupation within which an individual had a contact, income increased by 1.4 per cent, regardless of time in Canada or place of birth.

“The less diverse personal networks of immigrants cannot entirely account for their relatively lower employment rates and incomes. However, the economic adjustment of immigrants may be related, at least in part, to making contacts in different occupations,” concludes the report.

Read the full report:Personal networks and the economic adjustment of immigrants.”