Executive summary

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Participation in ethnic economies has been regarded as an alternative avenue of economic adaptation for immigrants, particularly for those who lack proficiency in the host-country language and for those with low levels of education. Much of the literature on ethnic economies is based on U.S. studies on a few minority groups in several large immigrant-gateway metropolises. Little is known about the development and consequences of ethnic economies in Canada. This study examines one dimension of ethnic economies in Canada: co-ethnic concentration at the workplace, based on a large national representative sample from Statistics Canada's 2002 Ethnic Diversity Survey.

This study addresses the following questions: (1) What is the level of co-ethnic concentration at the workplace for minority groups in Canada? (2) How do workers who mostly work with co- ethnics differ from other workers in sociodemographic attributes? In particular, are they more likely to have lower levels of host-country language proficiency and education? (3) Is a higher level of co-ethnic concentration at the workplace associated with lower earnings? If so, to what extent do demographic and job characteristics account for the association? (4) Is a higher level of co-ethnic concentration at the workplace associated with higher levels of life satisfaction?

The results show that the majority of immigrants and the Canadian born (persons born to immigrant parents) do not work in ethnically homogeneous settings. In Canada's eight largest metropolitan areas, about 10% of the immigrants with non-British or non-French origins work in ethnically homogeneous settings. The level is much higher among the Chinese (20%) and the Portuguese (18%), and is very low among most European immigrant groups. About 5% of Canadian-born minority-group members work in ethnically homogeneous settings. The level of ethnic concentration at the workplace narrows substantially from immigrants to the Canadian born among the Chinese, Filipinos and South Asians. By comparison, among Italians the immigrants and the Canadian born have similar levels of ethnic concentration at the workplace.

Immigrant workers in ethnically homogeneous settings have a much lower proficiency in English/French than other immigrants who do not work or work with fewer or no co-ethnics. About 31% of immigrant workers who share the same ethnic ancestry with most of their co- workers have English/French as their mother tongue or grew up in an English/French-speaking family environment. This is much lower than the level of 62% among those who had few or no co-ethnic co-workers.

Immigrant workers in ethnically homogeneous settings also have much lower levels of educational attainment than other immigrant workers. About 49% of immigrant workers who share the same ethnic ancestry with most of their co-workers have education beyond high school, comparing with 72% among those with few or no co-ethnic co-workers.

Immigrant men working in ethnically homogeneous settings earn, on average, substantially less (33%) than immigrant workers with few or no co-ethnic co-workers. This earnings gap is primarily attributable to differences in human capital factors and also to the fact that ethnically homogeneous settings are over-represented in low-paying occupations and industries. The gap reduces to 18% when years of residence in Canada, education and proficiency in English/French are controlled for, and it narrows further to 11% when differences in occupational/industrial distributions, self-employment status and working time are accounted for. Among immigrant women and the Canadian born, working in ethnically homogeneous settings is not associated with a significant earnings gap.

Immigrant workers in ethnically homogenous settings are less likely to report low levels of life satisfaction than do other immigrant workers. Among the Canadian born, there is no consistent association between the level of self-perceived life satisfaction and workplace concentration.