Question

For each of the following wage/earning differentials, give the most likely reason for the differential and write a 2-4 sentence explanation.

Census data from 2006 showed, at a national level, first-generation immigrants earned wages 12.6 per cent less than the average wage of native Canadians. In 2011, the gap dropped slightly to 10 per cent, but the new census data shows it’s climbed significantly to 16 per cent.

Answer 1

The wage gap differential shows in Canada; the economists are called this as statistical discrimination or taste-based discrimination. The crucial factors that explain wage gap differences in Canada is that personal characteristics, job experience and education and other factors. The census of Canada states that foreigners earn less than that of natives because of language proficiency. There is a considerable gap in the English language proficiency creates labor market discrimination.