Do Selection Criteria Make a Difference? Visa Category and the Labour Market Status of Immigrants to Australia

This paper assesses the role of selection criteria in the immigrant settlement process by analyzing the labor force status of immigrants entering Australia under different immigration programs. In particular, do immigrants selected on the basis of labor market skills rather than family relationships have higher participation and employment rates immediately after migration? To what extent does this represent a head start as opposed to a long-term labor market advantage? Information from the Longitudinal Survey of Immigrants to Australia (LSIA) are used address these questions. The results highlight the importance of visa category in predicting the likelihood that an immigrant desires employment and is successful in finding it. For the most part, migrants selected in part for their labor market skills have better labor market outcomes. Much of the difference in the labour market status of immigrants in different programs remains even once we have controlled for the effects of human capital and other productivity-related characteristics. Over time, the relative gap in the labor force participation rates of immigrants in different visa categories increases, while the gap in employment rates decreases. Finally, net of visa category, labor market outcomes are better for native English speakers and for those who visited Australia prior to migration