This chapter compares immigrant and native skills in OECD countries and discusses whether immigration policy is effective in attracting immigrant skills to the host countries. It reviews the academic literature on the returns to immigrant skills in terms of labour market outcomes: employment, skill mismatch and wages, and emphasizes the importance of taking into account different measures of skills as well as the country where the skills were acquired. The chapter reviews two sets of explanatory factors for the lower returns to immigrant than to native skills: on the one hand, immigrants with similar skills to natives may in reality be less productive in the host country; and on the other hand, employers may prefer to hire natives than immigrants. The conclusion puts forward key policy questions and challenges.

This chapter provides a systematic overview of the qualifications of the foreign-born and their returns in the labour market, both in Europe and the United States, compared with the native-born with similar demographic characteristics living in the same countries. Immigrants with foreign qualifications have on average lower educational attainment levels than the native-born. The differences are larger in the United States than in Europe, and are also larger for immigrants who have been longer in the country. Immigrants with foreign qualifications have lower returns to tertiary education than the native-born in terms of employment and in terms of job quality. There are also large differences in the qualification levels of immigrants and their returns on the labour market depending on their migration category, with labour migrants having higher qualifications and better outcomes than humanitarian and family migrants. Immigrants who report language difficulties have lower employment and higher overeducation than otherwise similar immigrants who do not. Finally, immigrants who have their foreign degrees recognised have significantly lower overeducation rates than immigrants who do not, even after accounting for the origin of the qualifications and the field of study.

Post-migration skill utilisation is fundamental to the successful economic integration of immigrants in a receiving country. Essential to the process are both the role of diverse economic actors in influencing skill relevance and credential/qualification recognition, and the growing understanding that the value of certain skills (e.g., education) in the labour market is conditional on the presence of other skills (e.g., receiving country language ability) together with the incorporation of this understanding into policy. This chapter explores recent developments in Canada, focusing primarily on immigrant selection policy related to skill portability. Canada is in the midst of a major reform of its immigrant selection system that is strongly influenced by a desire to facilitate skill portability leading to labour market success, and which seems to align with recent research findings. However, unanticipated responses to public policy initiatives are common, and there is a need to monitor ensuing developments to ensure that the observed changes in outcomes align with the policy goals.

The purpose of this chapter is to explore the newly available Survey of Adult Skills (PIAAC) to provide a detailed picture of migrants’ literacy and numeracy skills and how they compare with those of natives, and how they are utilised and valued in the labour market. The chapter provides a description of the Survey of Adult Skills and the differences between migrants and natives in terms of their literacy and numeracy proficiency levels. A discussion follows on the extent to which language and foreign qualifications explain part of such differences. Moreover, the chapter analyses the labour market outcomes (employment, incidence of overqualification and wages) of migrants relative to natives and discusses how these differ across migrant groups as well as the role played by literacy proficiency and other relevant factors. The analysis of wages pays special attention to the returns to schooling, literacy and numeracy proficiency as well to professional experience, distinguishing between the experience acquired abroad and that acquired in the host country. The chapter concludes by summarising the main findings and their relevance for policy and makes proposals for future work.