Canadian Immigrants Need Stronger Language Skills and Better Credential Recognition

October 27, 2026 – As Ottawa reconsiders immigration levels and how it selects newcomers, Canada needs to do more to translate immigrants’ education and skills into stronger economic outcomes, according to a new C.D. Howe Institute report.

In A Matter of Degrees: Understanding Immigrant Skills and Labour-Market Outcomes, Parisa Mahboubi finds that immigrants are more likely than non-immigrants to hold university degrees, yet score lower on measured literacy, numeracy, and adaptive problem-solving skills, with the largest gap in literacy.

“Canada has a highly educated immigrant population, but educational credentials alone don’t tell us enough about newcomers’ measured skills or how their qualifications translate into labour-market outcomes,” says Mahboubi, associate director of research at the C.D. Howe Institute. “We need to look beyond who we select to how we recognize immigrants’ qualifications and support their success after arrival.”

The literacy gap is particularly pronounced among immigrants who do not speak English or French most often at home and persists across education levels. Despite these differences, immigrants and non-immigrants with similar characteristics have comparable employment rates.  But immigrants with foreign credentials tend to earn less and are less likely to work in high-skill occupations than comparable non-immigrants, even after accounting for measured skills and other characteristics.

The report, supported by the Future Skills Centre through the Government of Canada’s Future Skills program, identifies three areas for improving immigration’s economic outcomes and making better use of immigrant talent:

First, the Express Entry program could raise its minimum language threshold and place greater emphasis on advanced proficiency in Canada’s official languages, with ongoing evaluation of longer-term outcomes.

Second, faster, more consistent credential recognition and better employer recognition of foreign qualifications could help address persistent earnings and occupational gaps.

Third, employment-focused language training after arrival should be rigorously evaluated to ensure programs effectively support immigrants’ labour-market integration.

“Immigration is central to Canada’s workforce and economic growth, but attracting educated newcomers is only part of the equation,” says Mahboubi. “Helping immigrants put their skills and qualifications to work is an important opportunity to strengthen productivity and improve economic outcomes for newcomers and Canada alike.”

Read the Full Report

For more information, contact: Parisa Mahboubi, Associate Director of Research, C.D. Howe Institute; Raquel Schneider, Communications Officer, C.D. Howe Institute, 647-805 3918, rschneider@cdhowe.org.

The C.D. Howe Institute is an independent not-for-profit research institute whose mission is to raise living standards by fostering economically sound public policies. Widely considered to be Canada’s most influential think tank, the Institute is a trusted source of essential policy intelligence, distinguished by research that is nonpartisan, evidence-based and subject to definitive expert review.

Want more insights like this? Subscribe to our newsletter for the latest research and expert commentary.

The Future Skills Centre (FSC) is a forward-thinking centre for research and collaboration dedicated to driving innovation in skills development so that everyone in Canada can be prepared for the future of work. We partner with policymakers, researchers, practitioners, employers and labour, and post-secondary institutions to solve pressing labour market challenges and ensure the benefits of lifelong learning are accessible to all. We are founded by a consortium whose members are Toronto Metropolitan University, Blueprint, and Signal49 Research, and are funded by the Government of Canada's Future Skills Program.