Canada’s Immigration Gains Were Driven by Selection – Maintaining Them Is Now the Challenge

April 16, 2026 – Canada’s immigration system delivered stronger labour market outcomes for new permanent residents after 2015 despite unprecedented intake levels, but recent trends among temporary residents risk undermining those gains, according to a new report from the C.D. Howe Institute.

In “Selection Matters: Lessons from Two Decades of Immigrant Earnings,” Mikal Skuterud and Ruiwen Zhang examine employment and earnings outcomes of immigrants and non-permanent residents from 2005 to 2024. The study finds that immigrants admitted after the introduction of Express Entry in 2015 experienced higher earnings at landing and strong earnings growth among highly educated immigrants, with recent male cohorts approaching parity with Canadian-born workers within five years.

“Stronger selection policies improved the economic outcomes of new immigrants, particularly among the university-educated,” says Skuterud. “These gains show that immigration can support economic growth when selection is aligned with long-run earnings potential.”

The report finds that improvements are concentrated among highly educated immigrants, especially men, consistent with the design of Express Entry. The system prioritizes candidates with strong human capital – including factors such as age, education, and work experience – and expected earnings. These gains were not accompanied by lower employment rates or weaker earnings growth, suggesting a durable improvement in immigrant outcomes.

However, the study also identifies a sharp deterioration in earnings among non-permanent resident men between 2020 and 2024, with average hourly earnings falling significantly relative to Canadian-born workers. The decline is most pronounced among college-educated workers and is consistent with changes in the composition of the temporary resident population, including shifts toward lower-earning subgroups.

The report highlights that recent policy changes, including the introduction of category-based selection and the growing role of non-permanent residents in the immigration system, may shift selection away from candidates with the highest expected earnings, potentially weakening the link between immigration and long-term economic performance.

To preserve and build on recent gains, the authors recommend returning to exclusive reliance on the Comprehensive Ranking System, while enhancing it with additional criteria such as field of study and prior Canadian earnings.

“Canada’s experience shows that selection matters,” says Skuterud. “Sustaining strong outcomes will require policies that prioritize long-term economic integration, not just short-term labour market needs.”

Read the Full Report

For more information, contact: Mikal Skuterud, Fellow-in-Residence and Roger Phillips Scholar of Social Policy at the C.D. Howe Institute, Professor in the Department of Economics at the University of Waterloo; Ruiwen Zhang, PhD candidate, University of Waterloo; Percy Sherwood, Associate Editor and Communications Officer, C.D. Howe Institute, 416-407-4798, psherwood@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.

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