A study by Statistics Canada has found a positive association between the number of immigrant workers in a business organization and the productivity growth of the company. As per the study, immigration also has a positive effect on the wages of the workers as well as profits of the company.
The study titled “Immigration and Firm Productivity: Evidence from the Canadian Employer-Employee Dynamics Database” assesses the effect of immigration on the overall productivity levels, worker wages and business profits based on data that tracks individual firms over time.
The study also found that the effect of immigration on productivity changed according to the length of the period used to measure these changes. The longer the period, the greater was the effect. It meant, for a one-year period, the impact of productivity was small while it increased gradually over a period of five or ten years.
Statistically, a 10-percentage point increase in the proportion of immigrants meant 1.9 percent increase in business productivity. But in the case of businesses that experienced a large increase in the proportion of immigrant workers, the contribution could be substantial, observed Statistics Canada.
The study further observed that the impact on business productivity was more significant in the case of low-skilled or less-educated immigrants compared to high skilled or university-educated immigrants. This difference was particularly visible in technology-intensive and knowledge-based industries.
As per the study’s findings, it is the complementary nature of the immigrant worker skills with that of the native workers which leads to increase in productivity. This is especially true in the case of technological or knowledge-based industries where the division of labour and job specialization is high. In such industries, the less-educated immigrants work complementary to domestic-born high-tech or knowledge-intensive workers. It gives such companies more opportunities for specialization and productivity growth.
At the same time, highly skilled immigrants were also observed to be important drivers of productivity with their potential to increase the degree of specialization, expand the use of new technologies and stimulate innovation.
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