Immigrants' Propensity to Self-Employment: Evidence from Canada


  • Peter S. Li

    1. University of Saskatchewan
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      The author wishes to thank Citizenship and Immigration Canada for developing and providing the data for this analysis. The author is solely responsible for the use and interpretation of the Longitudinal Immigration Data Base (IMDB) and whatever error and omission may remain in the article. This article is based on research supported by Citizenship and Immigration Canada, Social Sciences and Humanities Research Council, and Prairie Centre of Excellence for Research on Immigration and Integration. The helpful comments of Craig Dougherty, Sammy Abaidoo, Li Zong and four anonymous reviewers are kindly acknowledged. The author also wishes to thank Elizabeth Ruddick and Claude Langlois of Citizenship and Immigration Canada for the opportunity to work with IMDB.


Despite the appeal of the “enclave thesis” and the “blocked mobility thesis,” there are other relevant factors that help to explain why some immigrants engage in self-employment. Using the Longitudinal Immigration Data Base in Canada for 1980 to 1995, this study identifies characteristics of immigrants that yield a higher or lower propensity to self-employment. Descriptive statistics show that immigrants often use self-employment to supplement employment income and that the intensity and extensity of self-employment vary among immigrant entry cohorts, depending on gender, the year of immigration, and duration of stay in Canada. A logistic model predicting self-employment indicates that arrival in better economic years, longer residence in Canada, higher educational levels, older immigrants, and immigrants selected for human capital have higher odds of self-employment. These findings suggest that even though immigrants may be attracted or driven to self-employment, better-equipped immigrants are more inclined to engage in self-employment.