Immigration and firm productivity : evidence from the Canadian Employer-Employee Dynamics Database / by Wulong Gu, Feng Hou and Garnett Picot.: CS11-0019/451E-PDF

"Previous studies on the impact of immigration on productivity in developed countries remain inconclusive, and most analyses are abstracted from firms where production actually takes place. This study examines the empirical relationship between immigration and firm-level productivity in Canada. It uses a data file derived from linking the Canadian Employer-Employee Dynamics Database that tracks firms over time with the Longitudinal Immigration Data file (IMDB) that includes sociodemographic characteristics at landing for immigrants who arrived in Canada after 1980. The study finds that there is a positive association between changes in the share of immigrants in a firm and changes in firm productivity. This positive effect of immigration on firm productivity is small, but it is stronger over a longer period. The effect is larger for low-skilled /less-educated immigrants such as recent immigrants who tend to work in low skill occupations, immigrants who intended to work in non-high skilled occupations, and immigrants who intended to work in non-STEM occupations. Those differences are more pronounced in technology-intensive and knowledge-based industries. Finally, this study finds that there is a positive effect of immigration on worker wages and business profits, but little effect on capital intensity"--Abstract, page 5.

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