Toronto's immigrants turn to self-employment after recession year
|Report an Error|
Share via Email
The recession of 2008 drove many Torontonians in the direction of self-employment — with new immigrants taking the biggest brunt of the shrinking job market, according to a new study.
Between 2008 and 2009, the city’s self-employment rate rose from 15.7 per cent to 17.1 per cent, above the provincial and national benchmarks, says the joint report by Social Planning Toronto and Newcomer Women’s Services Toronto.
Among self-employed immigrants, 39 per cent had lost their paid employment just before they became self-employed. Some 63 per cent reported earning less than $10,000 a year, compared with about 57 per cent for non-newcomers, says the report, titled “The economy and resilience of newcomers,” to be released Tuesday.
“Self-employment should be a choice and not a survival strategy for newcomers. It should not be a product of labour market exclusion and social safety net exclusion,” said Navjeet Sidhu, a researcher of the study co-authored by Maya Roy and Beth Wilson.
Based on previously unreleased Statistics Canada data and interviews with newcomer entrepreneurs and service providers, the report examined the impact of labour market restructuring on newcomer entrepreneurship in Toronto.
During the recent recession in Canada, rates of self-employment increased by 3.9 per cent, while paid employment in both the private and public sectors shrank by 4.1 per cent and 1.6 per cent, respectively.
“Economic downturns do not impact all groups of workers equally. It is newcomers, particularly those recently arrived, who are more likely to lose their paid employment compared to Canadian-born workers,” says the 48-page study.
“These workers are often left to compete for low-paying, part-time and temporary types of precarious jobs to survive . . . Some workers are pushed into self-employment as a means to replace lost income from paid employment and due to the failure of government social safety nets.”
Toronto immigrants also fared worse than their Canadian counterparts in self-employment, with median income at $7,270 a year — $560 less than non-immigrants. They were also more likely to work in trade and transportation industries, while the business and professional services sectors are the most common for self-employed Canadians.
The newcomer group had a median before-tax total income (including paid jobs) of $17,220, compared with $25,180 for non-newcomers, though immigrant men made almost $1,000 per annum more than newcomer women.
Among more than 100 immigrant groups present in Toronto, newcomers from China were the most likely to be self-employed, followed by those from India, Pakistan, Iran and Ukraine. One-fifth of Chinese newcomers ran their own businesses, says the report.
Half of the 28 newcomer entrepreneurs surveyed for the study — who ran businesses ranging from life-coaching to landscaping — cited poor economic conditions, layoffs and limited job opportunities as reasons they decided to go into business for themselves.
The report recommends promoting business support services to prospective immigrants before they arrive in Canada, and finding ways to link newcomer entrepreneurs to local programs and resources such as Enterprise Toronto when they register a business or apply for an HST number.
It says front-line settlement workers should be better trained to connect newcomers to self-employment and entrepreneurial supports.
The study was funded by the City of Toronto, Atkinson Foundation and the United Way of Toronto.
More on Metronews.ca