Immigrant Workers in Canadian National Economy

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Introduction

Immigration is obviously one of the most controversial issues that are currently on the agenda of a range of powerful states. Defined by Blooemraad et al. (2008) as “a privilege accorded by established citizens” (p. 270), immigration, as a rule, triggers a range of negative economic consequences. However, the positive effects of immigration on the state economy are also to be born in mind; thus, an efficient strategy for addressing the problem may be designed.

Problem statement: poverty rates and immigration

Though being a state with an overall excellent economic performance record, Canada seems to have become notorious for its increasing immigration rates.

At this point, the specifics of the Canadian economy must be brought up. Reports say that an impressive amount of the Canadian entrepreneurships thrives on the migrant labor (The global comprehensive report, 2014; Alboim, 2009). Therefore, the significance of the workforce that legal and even illegal immigrants, the latter often being viewed as infiltrators (Immigration in Canada: A smaller welcome mat, 2010), make is not to be underestimated and surely must not be neglected. Instead, a viable strategy for balancing the negative effects of increased immigration rates with the positive outcomes must be created.

Theoretical framework: Heckscher–Ohlin framework

In order to research the problem in question, one will have to adopt the model that will allows for isolating the key factors affecting the economic issues and linking them to the immigration rates. More to the point, the social aspects of the lives of immigrants will have to be incorporated into the research. For these purposes, the Heckscher–Ohlin framework will be used. Proving that the reduction of international price differentials triggers an immediate and a sharp rise in immigration rates for a state (Schmidt & Kulkami, 2014) and linked to the Rybczynski theorem, which defines the connection between immigration and capital investment (Egger et al., 2011), the framework will help identify the significance of cheap labor as one of the major resources that Canada needs to import from other states in order to be able to sustain its economy and allow new products to come into being.

Methodology

Qualitative research as the key to understanding the issue

Seeing that the goal of the given paper is to generate a theory concerning the phenomenon in question, i.e., the immigration rates in Canada and their effect on the state economy, the adoption of a qualitative research approach will be a legitimate step.

Local authorities as respondents: the efficacy of surveys

In the course of the study, the Canadian authorities responsible for the provision of assistance to immigrants, registering the latter and addressing the employment issues that the migrant workers are likely to have, were asked to fill in a survey and submit it via e-mail. The survey responses incorporated the statistical data, personal evaluations and the information retrieved from annual reports. The results were analyzed and categorized in accordance with their significance.

Design of surveys and their distribution

The surveys consist of ten open-ended questions that allow the respondents provide the statistical data related to the immigration issue, ten multiple-choice questions, which will help locate the nature of the phenomenon and the factors that are related to it, and ten Likert scale questions, which will show the scale of the issue. The surveys will be distributed via e-mail to the following organizations: Canadian Immigrant Integration Program (CIIP), Immigrant Access Fund, Manitoba Immigrants’ Safety Initiative, New Brunswick Employment Language Training (NBELT) and Toronto Region Immigrant Employment Council (TRIEC) (Government of Canada, 2014).

Hypothesis: immigration is an essential part of the Canadian economy

Immigration is a part and parcel of the Canadian economy, and it must not cease. Its rates, however, need a reduction, which may be achieved by leveraging the prices for the Canadian products within the global market in accordance with the Heckscher–Ohlin model.

Literature review: what previous studies have to say

Immigration is an integral part of the Canadian economy (Alboim, 2009); it helps improve the state GDP and develop technology (Dustmann et al., 2008). More importantly, it allows for the state with rather rigid economic standards to operate within the unfettered global market realm. The Canadian authorities mark that the unemployment rates do not depend on the immigration flow – or, at least, not to the point where the phenomenon must be banned (The global comprehensive report, 2014). Aa, in their turn, show that the issue still raises major concerns among the local residents due to the fact that a number of immigrants abuse their social security benefits (Banting, 2010).

Hence, the need to control immigration rates emerges, which can be carried out with the help of the Heckscher–Ohlin model (H–O model). Proving that the price leverage within a global market will allow reducing the migration flow (Schmidt & Kulkami, 2014), the theory in question allows for making a conclusion about the need to reduce the prices for Canada’s national product within the global market (Thompson, 2011). The Rybczynski theorem, in its turn, assures that the economic growth pattern adopted by the state allows for complete sustainability (Egger et al., 2011). However, the Rybczynski theorem leaves a major issue out of the picture plane, which is the costs spent on the provision of social benefits to the target population (Egger et al., 2011).

Analysis of the Problem: Immigration as the Key to Sustaining the Canadian Economy

Immigrants as a cheap labor force

First and most obvious, the fact that immigrants are the cheapest labor force that Canadian entrepreneurs may possibly locate deserves to be mentioned. Though most studies never go into a full analysis of the subject matter, instead, only adumbrating the basic effects of immigration in Canada, the bottom line drawn by these researches is clear: Canadian entrepreneurships prosper owing to the existence of immigrants (Alboim, 2009).As a result, the state GDP is growing consistently.

Immigrants and the social benefits

However, the nearly gargantuan positive effect that immigrants have on the economic development of Canada is leveled with the excessive use of social benefits, which immigrants are often accused of. These accusations are not groundless – far from it; the abuse of social benefits is quite common among the Canadian immigrants, reports say (The global comprehensive report, 2014).

Immigrants and diversity issues

The last, but definitely not the least, the cultural issues must be brought up. There is no need to stress that in the environment of global economy it is imperative for a state to have experience of communicating with the representatives of other nations, and immigrants provide Canada with an opportunity to.

Results and Their Interpretation: An Adequate Model for the Enhancement of the Canadian economy with the Help of Immigrants

Social benefits as the major concern

The analysis of the data has shown that it is the abundance of social benefits and the consistent preference that the local entrepreneurships give to the migrant workers as opposed to the local residents with the slightly higher expectations for salaries that keeps the number of immigrants growing.

Unemployment and competition among the local residents

Surprisingly enough, the massive flood of migrant workers does not affect the unemployment rates within the state greatly. Therefore, it would be wrong to blame the increase in the number of immigrants for affecting the state economy in a negative manner. The fact that the unemployment rates in Canada have not been increased by a rapid influx of immigrants is a major justification for encouraging the latter and using it to the benefit of the state.

Immigration as the key to prosperity

Immigration triggers a range of new issues to handle for any state, and Canada is not an exception. Unemployment among the citizens of the state, the need to support immigrants with the help of social security, etc., are just a few to mention. With all that being said, immigration increases diversity rates, therefore, creating the premises for the state to develop economically and, most importantly, for the coexistence of immigrant labor and increasing GDP rates.

The application of the H-O model allowed to realize that the rates of immigration can be brought down by reducing the international price differentials and, therefore, making immigration to Canada non-lucrative for migrant workers. However, granted that the Canadian economy depends heavily on the migrant workforce, bringing the rates of immigration to their minimum seems unreasonable. Instead, the price of the goods produced by Canada and sold in the global market must be leveraged so that the migrant labor should be of greater worth to the state economy. The social security benefits, in their turn, will keep immigrants returning to Canada in order to enjoy relatively positive working conditions.

Conclusion: Immigration. Not a Problem, But a Viable Solution

Despite the common idea of immigration being a major economic block for the state’s further development, as far as Canada is concerned, the increasing rates of immigration can be used for the economic benefit of the country. The idea of using the immigration rates for the benefit of the state, therefore, must be reified as a price leverage model.

Reference List

Alboim, N. (2009). Adjusting the balance: Fixing Canada’s economic immigration policies. Web.

Banting, K. G. (2010). Is there a progressive dilemma in Canada? Immigration, multiculturalism and welfare state. Presidential Address to the Canadian Political Science Association, 797–819.

Blooemraad, I., Korteweg, A. & Yurdakul, G. (2008). Citizenship and immigration: Multiculturalism, assimilation, and challenges to the nation-state. Annual Review of Sociology, 34(8), 153–179.

Dustmann, C., Frantini, T. & Glitz, A. (2008). The labor market impact on immigration. Centre for Research and Analysis of Migration, 11, 3–24.

Egger, P. H., Ehrlich, M. v. & Nelson, D. R. (2011). Migration and trade. Trade Policy, 3486, 1–34.

Government of Canada. (2014). Best practices in settlement services. Web.

Immigration in Canada: A smaller welcome mat. (2010). The Economist. Web.

Schmidt, R. & Kulkami, K. G. (2014). A partial test of the Heckscher–Ohlin–Samuelson model: US-Mexico trade relations and labour in Mexico. Anveshak, 3(1), 11–44.

The global comprehensive report. (2014). Canada. Web.

Thompson, H. (2011). Estimating the Heckscher–Ohlin model: Inverting the inverse matrix. International Review of Economics and Finance, 20(2), 185–192.

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