Seeking Success in Canada and the United States: The Determinants of Labour Market Outcomes Among the Children of Immigrants

This paper reviews recent research on the determinants of the labour market outcomes of the children of immigrants in Canada and in the U.S. New research on outcomes in Canada is also presented. In the aggregate, and with no controls, the labour market outcomes of the second generation-the children of immigrants-are equal to, or better than, those of the third-and-higher generations-the children of domestic-born parents. However, the story is somewhat different after one has accounted for the superior educational levels and the residential locations of the second generation. In the U.S, the second generation's advantage in labour market outcomes disappears; in Canada, among second-generation members of a visible-minority group, the advantage turns marginally negative. Ethnic group/source region differences in outcomes loom large in both countries. The important determinants of the earnings gap between the second generation and the third-and-higher generations include educational attainment, which accounts for about half of the wage gap, residential location, ethnic background, the degree of "ethnic capital," and the educational and earnings mobility between immigrants and their children.