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Do Chinese Canadians struggle in the labour market?

Summary:
Update: The paper discussed in this blog is currently being updated. I will post a link to the revised version here when it becomes available. The revised results are close to those obtained using the PUMF. Thanks to Feng Hou for taking these concerns seriously and responding to them promptly. A recent Statistics Canada study by Wen-Hao Chen and Feng Hou reported a disturbing finding. Many second generation visible minority Canadians - "individuals who were born in Canada to at least one immigrant parent" - experience low employment rates. The relatively poor labour market outcomes of Black and Arab Canadians are disturbing but, given the obstacles racialized minorities face in the labour market, not unexpected. More surprising were Chen and Hou's reports of low employment

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Update: The paper discussed in this blog is currently being updated. I will post a link to the revised version here when it becomes available. The revised results are close to those obtained using the PUMF. Thanks to Feng Hou for taking these concerns seriously and responding to them promptly.

A recent Statistics Canada study by Wen-Hao Chen and Feng Hou reported a disturbing finding. Many second generation visible minority Canadians - "individuals who were born in Canada to at least one immigrant parent" - experience low employment rates. The relatively poor labour market outcomes of Black and Arab Canadians are disturbing but, given the obstacles racialized minorities face in the labour market, not unexpected.

More surprising were Chen and Hou's reports of low employment rates for second generation Chinese and Korean Canadians. The employment rates for second-generation Chinese Canadian men were, according to Chen and Hou, just 77.6 percent in 2016 - 10 percentage points less than employment rate for comparable Filipino Canadians, and 9 percentage points less than the employment rate for second-generation "white" Canadians. The employment rate for second generation Chinese Canadian women is, according to their estimates, even lower: 73.7 percent. 

Screen Shot 2019-03-21 at 11.09.15 AM

These numbers seemed odd to me, given that Chinese Canadians typically have favourable labour market characteristics, such as high levels of education and access to strong labour markets. Discrimination might explain part of the gap, as might Chinese Canadians staying in school longer than members of other ethnic groups - but could these two factors add up to a full 10 percentage point difference between Chinese and Filipino employment rates? I didn't think so. I tried, therefore, to replicate Chen and Hou's findings using the 2016 Census Public Use Microfile. I couldn't.

Here are my results:

Screen Shot 2019-03-21 at 12.40.22 PM

Some of the numbers are quite close to Chen and Hou's. The largest and most precisely estimated number - the employment rate for whites - is within 2 percentage points of the Chen and Hou figure. However others are very far off.

There are a few possibilities.

One is that I've made a coding error. That is entirely possible. Here is my Stata .do file if anyone would like to check it: Download Chen and Hou replication.

Another is that the 2016 Census PUMF is unrepresentative of the Canadian population. If that is true, it is a matter of serious concern to researchers and others who rely on the PUMF.

A final possibility is that Chen and Hou made a mistake in their analysis.

WCIers, what do you think?

Frances Woolley
I am a Professor of Economics at Carleton University, where I have taught since 1990. My research centres on families and public policy. My most-cited work is on modelling family-decision making, measuring inequality within the household, feminist economics, and tax-benefit policy towards families. I hold a BA from Simon Fraser University, an MA from Queen’s, and completed my doctorate at the London School of Economics, under the supervision of Tony Atkinson.

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