International Trade

Best Practices for U.S. Immigration Reform from Canada and New Zealand

During his 2017 State of American Business address last week, U.S. Chamber of Commerce President and CEO Tom Donohue referenced fixing America’s “broken immigration system.” He challenged the incoming Administration to “chart a balanced course that improves security and enforcement while modernizing America’s legal immigration and visa systems.” As the American Immigration Council and former Secretary of Labor Ray Marshall affirm, U.S. immigration law is unduly complex and fails to meet the needs of key industry sectors. Rather than being predicated on achieving national objectives, it has been shaped by terrorist attacks and threats, fears of illegal immigration and nativist tendencies fueled by economic uncertainty. The Immigration and Naturalization Act (INA) is the formal name of the body of law responsible for current immigration policy, and the current system is based on principles such as family reunification, attracting high-skilled immigrants, refugee protection and diversity promotion. Other countries like Canada, Australia, the UK and New Zealand highlight different admissions criteria that appear to be more in the national interest and might offer some best practices American policy makers could borrow.

While American immigration regulations lack coherence, Canada, the UK and Australia have established more flexible, consistent and goal-driven immigration policies tied to social and economic development. Some of the most effective programs include the following elements:

  • Emphasis on economic growth and minimization of worker displacement and wage competition between natives and newcomers;
  • Policies managed by specialized high-level public officials that prioritize migration issues;
  • Prioritizing national economic enhancement over family ties;
  • Two-step process involving temporary work permits followed by permanent residency, when applicable;
  • Recognition of foreign university-level students in higher education as a valuable economic resource including measures to retain students after graduation;
  • Same wages and working conditions as nationals;
  • National assessments to identify skill shortages;
  • Points system based on immigrants’ academic and professional background with flexibility to adjust to economic conditions;
  • Limited use of low-skilled or “guest worker” visas;
  • Effective programs to integrate newcomers into the society;
  • Discouraging anti-immigrant movements by ensuring that immigration policies respond to economic forces.

Canada prioritizes immigrants’ admission based on employment qualifications resulting in younger and better educated immigrants. In contrast, the U.S. focuses on family ties explaining why sometimes newcomers to America lack the education and skillset necessary to secure high-skilled jobs. Immigrants to Canada tend to have more education than Canadian natives, while immigrants to the U.S. are three times more likely than American citizens not to have completed high school.

Canada has successfully made adjustments to its immigration policies to meet specific challenges. Historically, immigrants to Canada were concentrated in just a handful of cities like Toronto, Vancouver and Montreal and concerns over whether immigrants matched employers’ needs and fulfilled basic English and French language requirements were common. Canada modified its system in order to address these challenges. The temporary foreign worker program was modernized and the points system altered to focus more on age, language skills and job offers from prospective Canadian employers. Canada expanded the Provincial Nominee Program to resolve the problem of immigrants’ low mobility and to assist the nation’s eastern provinces toward more solid economic growth. Canada also launched new programs such as the Canadian Experience Class (CEC), which allows individuals with an acceptable Canadian language level and at least one year of skilled work experience in Canada to receive permanent residency; the Federal Skilled Trades Program, which emphasizes specific occupations and requires more work and trade experience from those wishing to emigrate to Canada and a new Express Entry system to manage applications from potential immigrants with skills and work experience that are in demand. The Canadian system allows immigrants to obtain permanent residency in Canada more rapidly than in the U.S.

According to the National Geographic, “Canada has adopted one of the most open immigration policies in the world.” 21.3 percent of the total population is foreign born. These policies heralded positive economic outcomes in the country, such as the increase of the labor force and skilled labor pool, improvements in government financial indicators and developments in research, innovation, entrepreneurial activity and trade. For instance, in 2011, 22 percent of the Canadian labor force was associated with immigrant workers that had produced 41 percent of growth in the Canadian labor force since 2006. Immigrants are more likely to hold an advanced university degree and quicker to obtain degrees they do not have.  Additionally, 38 percent of those with degrees in STEM fields (science, technology, engineering and mathematics) are immigrants and their contributions to research, innovations and commercial products are invaluable. Immigrants also contribute to initiating new businesses. According to the Conference Board of Canada, 36 percent of small and medium sized enterprises have a majority owner who is an immigrant and they are more likely to export to countries than non-immigrant owned businesses. Finally, professionals from 20 to 55 years old generally tend to generate more in taxes than they cost in services, and immigrants are disproportionately represented in this workforce group.

Enhancing economic growth is also the main goal for New Zealand’s immigration policies which tries to attract immigrants with experience, skills or capital. Always in search of highly skilled workers, New Zealand identifies skilled worker shortages with the Long Term Skill Shortage List (LTSSL). After getting a job in a LTSSL occupation, the foreign worker is eligible to apply for the Long Term Skill Shortage List work visa and then, after two years, apply for the New Zealand’s permanent residence visa.

The best immigration policies share specific priorities and key strategies that boost economic development, spur national growth and maximize skilled migration. The most successful programs expand quotas, increase the number of countries from which immigrants come and implement the two-step migration program. They minimize migrant worker abuse, encourage the regional migration system (which has the advantage of being a faster process than the federal program, and of providing more opportunities for people not selected for the federal initiative); and facilitate the entry of permanent skilled migrants, temporary sponsored workers and international students. As Lesleyanne Hawthorne, professor of International Workforce at the University of Melbourne in Australia affirms, these governments “aim to attract the best and the brightest in an increasingly competitive global environment.”  It would benefit the U.S. to do the same.

In Depth: International Trade

International trade creates and supports millions of American jobs that offer higher than average wages and drive economic growth. As a testament to the strength of American entrepreneurship, the vast majority of U.S. exporters are not large corporations but small to medium-sized enterprises. Those that doubt the power of global…

+ International Trade In Depth