Wage Differences by Language Group and the Market for Language Skills in Canada

This paper presents a simple theory of wage differentials among language groups. In multilingual societies, if labor demand for speakers of one language exceeds the supply of native speakers, bilingual workers will generally come from other language groups. There will be a wage premium for speaking the "excess demand" language but no additional premium for being bilingual. This pattern is generally consistent with evidence from the 1971 Canadian Census. In Quebec there were substantial economic rewards to learning French or English for men who spoke neither, and substantial rewards to speaking English for native French speakers. Even after learning English, however, and holding other factors constant, native French-speaking men earned lower wages than monolingual English men. There was no significant wage premium for native English speakers who learned French. Outside Quebec, monolingual English men earned significantly higher wages than men whose native language was neither French nor English, other factors constant, but there were no significant differences in wage rates between them and bilingual English or monolingual or bilingual French workers.