THE ROLE OF SOCIAL CAPITAL IN THE SETTLEMENT OF IMMIGRANTS

IN CANADA

By

BLAIR JACKSON

Integrated Studies Final Project Essay (MAIS 700)

submitted to Dr. Foshay

in partial fulfillment of the requirements for the degree of

Master of Arts – Integrated Studies

Athabasca, Alberta

December, 2012

Contents Context ............................................................................................................................................ 2

Research Question .......................................................................................................................... 3 Relevance to Integration and Interdisciplinarity ............................................................................. 4 Methodology ................................................................................................................................... 5 Findings........................................................................................................................................... 7 Conclusions ................................................................................................................................... 18

References ..................................................................................................................................... 20

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ABSTRACT

Despite societal benefits expected from immigration, successful settlement is typically

measured largely in economic terms. Selection criteria, largely comprising human capital

criteria, mirror this economic focus. Conversely, the benefits of the social capital

immigrants possess are essentially disregarded. Evidence from numerous sources suggests

that the human capital approach to selection is not leading to improved settlement outcomes.

Discussion considers the limitations of the human capital metrics that are currently applied

and considers how social capital could contribute to an enhanced settlement experience. The

literature on the role of social capital in the settlement experience is limited. To address this

gap, the literature review includes not only the standard peer-reviewed sources but is also

expanded to include other publications, such as program evaluations and grey literature.

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Context

Canada relies on immigration for the majority of its net population increase. Since 2001,

sixty-six per cent (66%) of the net Canadian population growth has been a result of new

immigrants. (Statistics Canada 2012) The immigration formula is largely used to build

capacity in labour market areas that require specific skill sets. The exception to this is that

Canada also accepts immigrants for compassionate reasons (i.e. family class and refugees).

In theory, to meet economic needs and effectively fill specific labour market gaps , Canada

must attract potential immigrants who align with labour market gaps and hold the required

skill sets. Despite Canada’s reliance on immigration for growth, we continue to see

newcomers encountering challenges when integrating into the Canadian labour market.

Therefore, consideration must also be given to the soft skills (or social capital) required to

successfully settle in Canada.

Statistics Canada data (2006) suggests that immigrants who have been in Canada five years or

less, have the most difficulty integrating into the Canadian labour market, even though they are

more likely than the Canadian-born population to have a university education. The situation

improved for immigrants who had been in Canada between 5 and 10 years. Therefore, the longer

immigrants remain in Canada, the better they fare in the labour market, and the gap narrows

between these immigrants and Canadian-born workers. This suggests more can be done to

improve the settlement experience for newcomers.

The economic agenda for immigration arguably has a large social dimension, beyond labour

market integration. Fundamentally, without social supports and social ties it is difficult to

retain immigrants. However, more comprehensively, when newcomers attach to

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communities and the labour market we are essentially expanding our society. This societal

shift cannot occur smoothly without considering the formal supports that facilitate

settlement, including interventions and services that are in place (e.g. programs and

services, etc.). It is equally important to consider the role of informal supports (e.g. family,

friends, language, cultural groups, etc.). Theoretically, if immigrants have social

connections to attach to (e.g. family, friends, cultural community, etc.) they will face

reduced barriers, compared to immigrants with similar characteristics, but limi ted social

connections.

Research Question

This research project investigates the impact of social and economic factors on settlement of

immigrants to Canada over the past 10 years. The focus is on immigrants who landed as

Economic class immigrants. The rationale for exclusion of refugee class immigrants is the

nature of their immigration process. Due to the circumstances that refugee class immigrants

face prior to arriving in Canada, it can be assumed that refugees would put less emphasis on

labour market integration, and more emphasis on meeting immediate needs. Family class

immigrants are considered, in that they arguably contribute to the social capital of economic

class immigrants.

Due to the relationships that exist between social and human capital, these factors must be

considered, in parallel, when determining factors that have significant influences on the

ability of new Canadians to successfully settle in Canada. Ultimately, the human capital

model could likely benefit from greater consideration of social capital factors. This topic

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will be addressed through examination of the question, “What social and human capital

factors should be considered in the settlement experience of new Canadians?”.

Relevance to Integration and Interdisciplinarity

Research on settlement, integration, human capital and social capital has been completed in

the disciplines of sociology and economics, as well as interdisciplinary studies. For

example, from the sociological perspective, immigrants are people with their own cultures

who are living among a new culture. We must understand the social context of settlement in

order to understand the other characteristics. Economics also plays a key role in measuring

and understanding settlement. Economists track the economic performance of immigrants,

and correlate it to integration. Over a period of time it is anticipated that individuals will

“perform” better in the labour market. This performance is most often measured by

earnings. From the psychological perspective, there is a great deal of pressure placed on

individuals to integrate into the labour market. These pressures come from within the

individual, within the family, and from society. All of these factors potentially have a

psychological impact on the individuals. Ultimately, integration is about the path that

individuals take to transition from one society to another. The economic aspects are easier

to quantify and as a result, most monitoring systems have an economic bias. This suggests

that more emphasis needs to be placed on measuring the human experience in order to better

understand the impact of social capital on the settlement and integration experience. The

intent of this interdisciplinary paper is to develop a broader understanding of the research

problem (and solutions) by comparing and contrasting information from diverse sources .

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Methodology

The research genres considered for analyses include literature review, empirical data

review, and standard content analysis. Reliability of sources is weighed; as were the

limitations of these lines of inquiry.

This research utilizes multiple disciplines and multiple sources of knowledge. The

disciplines that have been drawn on are primarily sociology and economics; however the

analyses was transdisciplinary. Disciplinary vocabulary and scholarly sources have been

used in order to form part of a transdisciplinary approach that considers disciplines and

traditional sources of knowledge, as well as non-traditional sources (e.g. grey literature,

program evaluations, special studies, etc.). Notably, several of the peer reviewed journal

articles were interdisciplinary efforts, as were many of the program evaluations. This is not

a result of targeted selection of these articles on this basis- much of the body of literature

around immigration crosses sociology and economics.

One limitation identified in the review literature review is the lack of research on the

influence of social capital on the settlement process. This finding is juxtaposed to a very

deep body of literature on income disparities, settlement challenges, and labour market

integration issues.

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Definitions

Human Capital: The definition of human capital is fairly uniform in the literature. It

comprises skills, education, and experience. (Chakraborty & Guptab 2009) This concise

definition is also the operational definition for this research paper.

Social Capital: There are a myriad of definitions of social capital. The nominal definition

that is best aligned with this research topic is “the ability of actors to secure benefits by

virtue of membership in social networks or other social structures” (Portes 1998). For the

purpose of this research the definition is operationalized as the network of support available

to immigrants, including social networks and other social structures (e.g. family), which

enable the settlement and integration process.

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Findings

Overview of Immigration System and Supports

The intent of immigration, as written in the Immigrant and Refugee Protection Act, is

to permit Canada to pursue the maximum social, cultural and economic benefits of

immigration. The nuance here is that the Act is to permit Canada to derive these benefits,

rather than to allow each immigrant the ability to maximize social, cultural and economic

benefits. (IRPA 2002) Additional objective under IRPA are to see that families are reunited

in Canada (IRPA 2002) and “to promote the successful integration of permanent residents

into Canada, while recognizing that integration involves mutual obligations for new

immigrants and Canadian society”. (IRPA 2002)

To contribute to the objectives of the Act, the Canadian immigration system is stratified into

three key categories whereby potential immigrant can apply. These categories are 1)

economic class immigrants; 2) family class; and 3) refugees. Economic class immigrants are

selected based on their potential to contribute to Canada’s economy. This includes sub-

categories of skilled workers, business immigrants, provincial and territorial nominees, and

live-in caregivers. The common thread of these sub-categories of the economic immigration

stream is that the applicant is assessed on their likelihood contributing economically by

participating in the labour market. In the case of business immigrants this participation may

be through investment, rather than active participation. Family class immigrants and

refugees are not assessed based on self-sufficiency in the Canadian economy. Rather, family

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class immigrants are sponsored by close relatives or family members in Canada who agree

to support them financially, and refugees are sponsored by the Government of Canada or

private sponsors. To support immigrants across these categories the federal government

offers approximately $1Billion in programs and services to support immigrants. (CIC

2012a) However, settlement supports (CIC 2012a) are oriented largely toward labour market

integration, and include language training, employment services, and building professional

connections. To a lesser extent, support is available for services that build social capital

(e.g. mentoring, promotion of multiculturalism, etc.). (CIC 2012a) This research examines

the human capital factors that are expected to contribute to economic outcomes, and also

examines how social capital can contribute to settlement (economically and otherwise).

Human Capital Dominance

Human capital theory has been applied in measuring economic integration for several

decades. Human capital factors are often used to describe the quality of immigrants. For

example, Wright and Maxim (1993) use wage differentials on arrival as a measure of

immigrant quality. In this context, a small wage differential on arrival, and/or fast wage

growth post-arrival supposedly indicates higher quality. It is a common method of analysis;

however, the extent to which human capital calculations consider the labour market needs

that align with specific cohorts, is questionable. Although wage differential and wage

growth can be considered indicators of integration success, it is also important to consider

the economic conditions of sectors immigrant are applying to as well as the social capital of

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the immigrant. Perhaps the outcome of this would be a broader definition of what successful

settlement and integration means.

More recent trends indicate that additional emphasis continues to be placed on the human

capital that immigrants possess. In 2011, significant reforms were applied to the

immigration system to respond to Canada’s economic needs (CIC 2012a). These reforms

included more emphasis on selecting newcomers with skills relevant to economic needs.

These policy reforms were implemented specifically to improve economic objectives. In

addition, a recent CIC announcements highlighted that recent changes to the federal skilled

worker immigration stream will improve Canada’s ability to “... select skilled workers who

can ‘hit the ground running’ upon arrival” (CIC, 2012b). This suggests that there is little

patience for immigrants with deficits in social and human capital.

The federal government has identified the need for highly skilled labour and certain trades

as Canada’s growth continues to rely, in significant part, on selecting immigrants who can

meet the needs of Canada’s changing labour market. The intent is for these strategically

selected immigrants to have access to settlement programs that maximize contributions to

the Canadian economy (CIC 2012a). The government continues to focus on developing an

immigration system “with a primary focus on meeting Canada’s economic and labour

market needs.” To this end, some specific changes in immigration criteria include working

to establish a minimum language threshold and mandatory language testing for low-skilled

provincial nominees (CIC 2012a). Other reforms include a continued focus on highly

educated immigrants, with a new stream under the Federal Skilled Worker Program for

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international students pursuing PhD studies in Canada. In addition, a new Federal Skilled

Trades Program is planned in fiscal year 2012/2013 which will assist in expediting the

immigration process for immigrants in Trades where Canada has identified shortages. (CIC

2012a)

With changes in labour market demand the education levels of immigrants are changing.

Approximately half of the immigrants to Canada had some post secondary education.

Within these proportions the mix is shifting towards higher education. For example the

proportion of those with bachelor degrees has steadily declined since 2002 and been

replaced by an increasing proportion of immigrants with a Masters degree or PhD (CIC

2011b). Notably, when examining access to a job in the desired occupation, the desired

occupation is obtained more rapidly by those seeking work in nonprofessional jobs (e.g.

sales, services, trades, transport and equipment operators, primary industry, and processing

and manufacturing occupations). This highlights yet another misalignment between the

intent and the result of assessing human capital. Additional characteristics that influenced

the speed of access to a desired occupation include human capital elements, such as

education, English language ability, Canadian work experience, as well as, social capital

factor, including networks of friends facilitating access to the intended occupation (Grenier

& Xue 2011).

While policy refinements with a heavy focus on economic criteria have been implemented,

the proportion of economic class immigrants rose to 63% of total new immigrants in 2011,

up 8% from 2006. (CIC 2006; CIC 2012a). This results in shrinking intake of family class

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immigrants. It is not evident that this policy shift has considered the value that family class

immigrants have on economic class immigrants. For example, family members (particularly

parents) theoretically play a role in supporting the work of the economic immigrant, by

providing childcare, conducting household tasks, and by reducing pressure to return to the

country of origin to be with family.

A key barrier that is not addressed by current human capital intake criteria is foreign

credential recognition (FCR). One issue around FCR is that the federal government

valuation of foreign credentials (Carter 2009) does not entirely align with that of labour

market realities. Human capital is open to interpretation and when comparing fact and

perception, it is often the perceived that is most important. For example, if an employer

does not recognize the human capital of an individual then their labour market integration

will not be commensurate to their expectations. This interpretation of human capital is often

influenced by employer requirements and regulatory requirements for Canadian work

experience, credential recognition, licensing for regulated professionals, and work-specific

language abilities (Alboim et al, 2007). This ‘discounting’ of foreign credentials is widely

recognized in the literature (Brouwer 1999; Alboim, Finnie and Meng 2005; Carter 2009; CIC

2010c; Sommerville & Walsworth 2010). Discounting of foreign credentials is further

evidence that more consideration of social capital is required.

Boudarbat and Boulet (2007) support the argument that selection and integration are not

directly aligned, indicating that Canada’s immigration selection criteria is intake focussed

rather than integration focussed. Selection grids give considerable weight to foreign work

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experience. However, immigrants who have been selected at least in part on the basis of

their professional experience often find that foreign experience is not recognized in the

Canadian labour market (Boudarbat & Boulet 2007). By valuing an applicant’s foreign

credential and work experience, the applicant assumes that these credentials will be recognized

in the labour market (Sommerville & Walsworth 2010). To address challenges related to

discounting of credentials some immigration intake streams require the applicant to secure

employment in advance (CIC 2011a). This prerequisite mitigates the uncertainty between foreign

credentials and labour market realities. It is not a perfect solution, however. If the first

employment opportunity terminates, the individual is left to see if other employers will recognize

their skills and experience. To address these FCR issues, CIC continues to implement

measures to improve recognition of foreign credential (CIC 2012a).

Dobrowolsky (2012) provides a regional perspective on the debate over how Canada selects

immigrants and what factors assist with settlement. Dobrowolsky suggests that a better balance

must be struck between economic and social immigration priorities, which, according to the

author, are “out of balance under the current neo-liberalist federal agenda” (Dobrowolsky

2012). The author qualifies this remark by highlighting the government’s emphasis on attracting

highly skilled immigrants; expanding low wage (i.e. low skilled positions) temporary foreign

worker positions; and encouraging settlement in less populated areas (where formal settlement

supports are minimal). Although economic opportunities are distributed across Canada, formal

and information social supports are not delivered consistently outside major urban centres

(Akbari 2008). Economic agendas tend not to recognize this imbalance in distribution of social

supports.

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Social Capital Considerations

Overall the literature on the influence of social capital on settlement success is not

extensive. In the absence of a significant body of literature characterising the influence on

social capital on settlement, a cross sectional analysis of program evaluation findings was

completed for this research paper. The findings of this cross sectional analysis suggest that

measurement of social capital is limited and the correlation to social capital and settlement

is essentially non-existent. However, there are some indicators that emerged, which could be

catalysts for further investigation. For example, the Provincial Nominee Program (PNP) selects

immigrants based on their ability to attach to regional labour markets. Provincial Nominees

emphasize the importance of the network of support provided by friends and family through their

settlement process (Carter 2009). Recognizing this, some provinces deliberately use social

supports to attract immigrants away from major centres (Akbari, 2008; Carter et al, 2008), such

as Montreal, Toronto and Vancouver. For example, the Manitoba PNP emphasises the

importance of social factors such as family and community ties; settlement and integration

support; timely, accessible and appropriate language training; access to health care, education

and social programs; and cultural and recreational opportunities (Carter et al 2008). Ultimately,

targeted selection of immigrants, based on human capital, does not appear to unilaterally assist

individuals with labour market integration (Boudarbat and Boulet 2007).

Despite the importance of social capital, the capacity of the primary service providers is limited

in providing a full spectrum of social and economic settlement supports (Richmond and Shields

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2005). However, on a small scale, some successful support to human capital is being delivered.

Findings from the review of evaluations related to immigration indicate that although social

capital is under represented, some relevant findings emerged. A review of a Federal

Provincial Nominee Program evaluation found recognition of the importance of family

connections in the selection criteria. This is unique for an economic program. The

assumption behind the Family Stream in PNP is that having a family connections means that

nominees are more likely to settle in the province or territory of nomination (CIC 2011a). It

should be noted that the eligibility criteria for “family member” is broader than federal

Family Class definition. Under the provincial streams sisters/brothers, step-brothers/sisters,

nieces/nephews, step-daughters/sons, uncles/aunts, sisters/ brothers-in-law and first cousins

are all included. Although the scope of family is broader, provincial Family Stream

applicants must demonstrate the ability to establish economically; unlike the Federal family

class (CIC 2011a). The existence of this stream further supports the theory that social

capital makes an important contribution to settlement. This is not the case for criteria on

other programs. The FSW program presented mixed perspective with respect to social

capital. For, example, the FSW program considers family relations in Canada somewhat of

an asset in scoring criteria. Conversely, however, family was also considered a potential

risk, as a potential source of fraudulent job offers from family members (CIC 2010c).

Analysis of some evaluation conclusions suggest that further consideration is required on

the part of policy makers when balancing program objectives. For example, the Federal

Skilled Worker evaluation (CIC 2010c) concluded that the FSW Program contributes to

increasing diversity in the social and economic fabric of Canadian society by supplying

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qualified and experienced workers. Although, the economic contribution is evident, it is

unclear how the contribution qualified and experienced workers make to the social fabric is

measured.

The Host Program leverages the experience of Canadians to build the social capital of

newcomers. An Evaluation of the Host Program, which partners newcomers with Canadians

who can assist them in becoming oriented with their community, found that settlement and

adaptation was significantly improved by connecting with a Canadian to guide them and

introduce them to community connections (CIC 2010a). The program led to improved social

capital through improvement in newcomers’ language skills, understanding of Canadian

culture, familiarity with community and independence. The Host Program also assisted in

reducing settlement related stress, and improved social networking. The program also had a

moderate impact on some program participants’ professional networks (CIC 2010a).

It was anticipate that the Multiculturalism Program evaluation (2012d) would supply

significant evidence on the benefits of social capital. After all, this program is the main

program oriented at building a socially cohesive society. Part of the programs function is to

facilitate interaction among communities in order to increase mutual awareness and

understanding. These interactions are found to be effective in promoting social cohesion.

The program also emphasises equal opportunity for individuals of all origins. Measuring the

former (interactions) is far easier to measure than the latter (equal opportunity for all)

activities. The evaluation found there are inherent challenges with measuring the outcomes

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of social programs, particularly with respect to the attribution of outcomes. In addition, little

on-going performance measurement of project outcomes is occurring.

Additional evidence of the value of social capital emerging from program evaluations

includes refugees leaving their original destination in Canada to reunite with family, friends,

and or ethnic community in other provinces; (CIC 2011b) and newcomers obtain

information primarily from family and friends (CIC 2012c). In addition, Federal Skilled

Workers cited limited social networks as a barrier to finding employment (CIC 2010c).

Despite the pervasive human capital agenda, evidence from this cross sectional analysis suggests

that targeted labour market programs benefits from supports that enhance social capital.

Additional benefits of social capital are realized when complementary programs are accessed by

immigrants. The Temporary Foreign Worker (TFW) program allows employers to hire foreign

workers on a temporary basis to fill short-term labour market needs. These TFWs gains relevant

Canadian work experience while working temporarily. The TFWs also build social capital during

this period (e.g. social networks, community orientation/participation etc.). In addition, based on

the lived experience as a TFW, the individual can make an informed decision on whether their

experience and credentials match long-term labour market needs. Following the temporary work

period, some TFWs apply to the PNP (CIC 2011a). The theory behind transitioning individuals

from TFW to PNP is that the Provinces are in a position to assess skills and experience that

includes Canadian work experience (CIC 2011a).

Another method of concurrently building social and human capital is international graduate

studies. International graduate students acquire education that assists in building their human

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capital, while developing life experience which builds their social capital (Akbari 2008). Using a

Canadian education as path to improve settlement is supported by earlier literature (Reitz 1998) ,

which suggests a greater impact will be made on long-term settlement, by integrating

immigrants in educational institutions, while applying less concentration on labour market

integration (Reitz 1998). Similar to TFWs, international graduate students can make more

informed decisions on their ability to settle, compared to immigrants who have not lived in the

country.

Considering the long continuum of settlement and integration, the current range of initiatives

may not be sufficient (Akbari 2008; Boudarbat and Boulet 2007; Robson-Haddow and Ladner

2005). To this end, recommendations have been put forth by the Standing Committee on

Citizenship and Immigration in 2003 to improve the scope and the eligibility for federal

settlement initiatives(Robson-Haddow and Ladner 2005). It appears that such recommendations

are still relevant given the current context.

Looking beyond the realm of labour market integration, social capital also influences the most

fundamental settlement needs. For example, precariousness of housing situations may be

increased in individuals lacking social networks and/or socially excluded individuals (Newbold

2010). Newbold adds that newcomers with limited social support in the community are more

likely to experience homelessness as many rely on social networks for accessing housing. Low

social capital has also been linked to poor physical and mental health outcomes (Newbold 2010).

To mitigate negative outcomes of low social capital, mentor programs are available to assist

newcomers. Mentors have the ability to provide information about Canadian culture, help to

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develop social network, and help tin building overall social capital (House of Commons 2010).

An added advantage of mentor programs is that they leverage volunteers from the community so

they are an efficient means of achieving results.

Conclusions

Labour market integration has been a continual challenge for immigrants, and little evidence

suggests that progress is being made to reduce barriers. Considering economic realities and

labour market needs, human capital will remain an important aspect of settlement selection

criteria. However, more emphasis should be placed on determining the value of various

aspects of social capital. Measuring success, purely on an economic basis, omits social

factors that contribute to settlement and arguably sustain economic outcomes over the long-

term. This is an important consideration given the high proportion of population growth that

is attributed to immigration.

The most commonly recognized elements of social capital that contribute to settlement

include family/friend support and community connections. Although social capital

facilitates settlement and integration, it cannot replace fundamental elements of human

capital such as recognized skills and credentials. Moreover, if the basis of selection of

immigrants continues to be weighted toward human capital, successful settlement could be

further enhanced by additional consideration of social capital. This balance would provide

and additional mechanism to validate whether an immigrants human capital will be realized

in a successful settlement experience.

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In addition, considering the limitations in measuring and reporting on settlement outcomes

(CIC 2010b), adding additional metrics related to the influence of social capital on

settlement will be challenging, but necessary. Even one of the most robust Canadian studies

of social capital (Xue 2008) found the relationships between social capital indicators and

labour market outcomes are not clear. One avenue toward addressing this challenge would

be an international comparative review to determine how other countries value social capital

in the immigration and settlement process. In addition to human and social capital, societal

factors should also be recognized when trying to understand barriers to integration, including

gender, visible minority status, and disability (Hum 2003).

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