|
Article Excerpt
THE IMMIGRANT ENCLAVE ECONOMY THESIS first developed by Wilson and Portes (1980) offers a refreshing understanding of how some immigrant groups in North America manage to develop alternate avenues of social mobility by forming a protected economy using immigrant labour, ethnic urban concentration and cultural affinity. Despite the theoretical promise, there have been heated debates regarding whether the enclave economy brings positive or negative returns to those immigrants who participate in it (Jensen and Portes, 1992; Portes and Jensen, 1989; 1992; Sanders and Nee, 1987; 1992). Much of the controversy has to do with the imprecise way by which participation in the enclave economy has been gauged using census data. The purpose of this paper is to use new data from the 2001 Census of Canada to test whether Chinese immigrants in Canada who participate in the enclave economy as wage workers and entrepreneurs have better or worse returns than their counterparts in the mainstream economy.
Enclave Economy Debate
The enclave economy thesis postulates that the ethnically sheltered economy offers immigrants an alternative avenue of mobility because, unlike those in the secondary labour market, those who participate in the enclave economy enjoy economic returns from past human capital investments similar to those in the primary labour market (Wilson and Portes, 1980). Thus, rather than being handicapped by language and cultural barriers, ethnic cohesion and cultural distinctiveness form the basis of labour recruitment for immigrant employers and allow them privileged access to a low-cost immigrant labour pool, as well as to an ethnically based consumer market. Accordingly, the enclave economy does not deprive its participants, but rather, the reciprocal obligations between ethnic employers and employees provide new opportunities and an alternative avenue of mobility for immigrants.
Proponents of the immigrant enclave economy stress that cultural-specific internal organization and ethnic social relations are conducive to forming such an economy (Evans, 1989; Portes and Bach, 1985; Portes and Jensen, 1989; Portes and Zhou, 1996; Wilson and Portes, 1980; Zhou, 1992). However, the strength of the enclave economy is premised upon the growth in immigration population and the urban size of immigrants, as well as the ability of the immigrant community to take advantage of ethnic ties and relations in developing a protected economy. In other words, the importation of financial and human capital by immigrants, together with the increase in the immigrant population in urban centres, helps the enclave economy to prosper.
One difficulty of the debate has to do with the discrepancy between the advanced level of theorization of the enclave economy and the crude way participation in the enclave economy is operationalized. Theoretically, the enclave economy is distinct from the core and the peripheral economies in that the labour and market relationships in the enclave sector are mainly structured upon ethnic solidarity (Wilson and Martin, 1982; Wilson and Portes, 1980). Such a "pre-existing ethnic economy" (Portes and Jensen, 1987: 768) is believed to emerge from external market conditions and internal ethnic solidarity; the former restricts minorities' opportunities in the open market due to such factors as discrimination, while the latter enhances the development of immigrant-based enterprises because of the strength of ethnic institutions and affinal connections (see Bonacich and Modell, 1980; Light and Bonacich, 1988; Light and Rosenstein, 1995; Waldinger, Aldrich, Ward and Associates, 1990). New immigrant workers are often attracted to the enclave economy because of linguistic convenience, cultural familiarity and ethnic support; as well, security in the enclave economy offers them the hope and some opportunities to become ethnic entrepreneurs (see Nee, Sanders and Sernau, 1994). Thus, the enclave economy has its own internal complexity and dynamics that are at least partly structured on common ethnicity, linguistic sameness and urban proximity.
Since the development of the enclave economy thesis, there has been further theoretical refinement of the concept, which has three widely accepted components: an interrelated economic and business structure in a spatial concentration such as a metropolitan area, ownership and control by ethnic entrepreneurs, and reliance in a significant way on an immigrant labour pool composed of workers whose ethnic and language background is similar to the entrepreneurs' (Portes and Jensen, 1989). A further distinction is also made among different types of niches where immigrants may concentrate, including employment niches, entrepreneurial niches and ethnic enclave economies (Logan, Alba and Stults, 2003). The first two types refer to occupational concentrations in particular urban sectors, such as Waldinger's study of immigrants establishing an occupational niche in municipal government jobs in New York (Waldinger, 1994).
Despite these theoretical clarifications, the fundamental understanding of the immigrant enclave economy as a mobility trap or a mobility avenue remains contentious. The original claims of Wilson and Portes (1980) regarding the attractive returns of the enclave economy have been challenged by Sanders and Nee (1987) on the grounds that the economic returns predicted by the enclave economy thesis apply only to immigrant employers, and that immigrant workers in the enclave economy experience lower returns than their counterparts in the open market. Furthermore, Zhou and Logan (1989) show that male workers in New York City's Chinatown enjoy positive earning returns from education, although the same effect does not hold for female workers. Subsequent exchanges between researchers show that conclusions about the returns of immigrant enclave economies vary, depending on whether residing in a city or working in a city is used singly or in combination in classifying the participation in the enclave economy (Jensen and Portes, 1992; Portes and Jensen, 1992; Sanders and Nee, 1992).
Thus far, the weight of the evidence lends support to the understanding that there is an earnings disadvantage for employees in the immigrant enclave economy compared to salaried workers in the mainstream economy, although the evidence is less clear for ethnic entrepreneurs or the self-employed (see Jensen and Portes, 1992; Logan, Alba and Stults, 2003; Nee and Sanders, 1987; Portes and Jensen, 1987; 1989; Sanders and Nee, 1987).
Studies in Canada have produced findings that confirm both the positive and negative aspects of the ethnic enclave economy, but the notion of the enclave economy is loosely applied. For example, Chan and Cheung (1985) found in their study of Chinese businesses in Toronto that Chinese business owners benefited from certain collective resources of the community, such as group solidarity, ethnic customers and ethnic labour, although individual resources were also important. In the Portuguese community in Toronto, several studies found that community resources such as local networks and ties largely contributed to the formation, maintenance and success of Portuguese-owned real estate businesses (Teixeira, 1998; Teixeira and Murdie, 1997). Marger and Hoffman (1992) studied ethnic businesses in Ontario and found that the success of Hong Kong entrepreneurs was aided by the rapid growth of the Chinese population and the corresponding expansion of the consumer market, and the adoption of a business strategy to target labour-intensive businesses that made use of a network of ethnic institutions. The role of contextual factors, such as the influx of immigrant population and offshore capital in the creation of the ethnic subeconomy, was also confirmed by a study of Chinese businesses in Richmond, B.C. (Li, 1992). A study of East Indian entrepreneurs in Toronto also found that while ethnic networks and communal ties were important in the development of business strategies, their effect was not as consequential as class resources (Marger, 1989). However, another study of Indo-Canadian-owned construction businesses in Vancouver found that family- and ethnic-based economic strategies facilitated their growth in ownership in construction and construction materials businesses (Walton-Roberts and Hiebert, 1997). At the same time, embedded social networks produced mixed consequences: immigrant workers lacking formal qualifications and official language skills were given jobs because of network connections, but in return had to adjust to flexible work hours and wage rates (Walton-Roberts and Hiebert, 1997). The study also found that Indo-Canadian entrepreneurs relied on ethnic networks in different degrees, with the most successful ones moving beyond the confines of the ethnic market (Walton-Roberts and Hiebert, 1997).
The controversy of the enclave economy debate reflects the difficulty in mapping participation in the enclave economy and the desire of researchers to advance the theoretical debate. Much of the controversy has to do with the use of limited census data to gauge the participation in the enclave and non-enclave economies. The conventional practice is to use a city-wide area to map out where a member of a specific ethnic group works or lives and, on such basis, determine whether the person participates in the ethnic enclave economy or not. For example, Portes and Jensen (1989) use a typology based on whether Cuban immigrants work or live anywhere in the cities of Miami and Hialeah to determine four combinations of enclave participation in Florida, ranging from those who work and live in Miami or Hialeah to those who neither work nor live in those cities. Thus, the conventional method of measuring enclave economy participation is crude at best, as it assumes an immigrant living or working in a given city is most likely participating in the immigrant enclave economy. Portes and Jensen (1989: 933) are well aware of this limitation, but they justify the use of this method of measurement as follows: "... it is still possible to assume that Cuban immigrants in Florida who work in the cities of Miami and Hialeah are more likely to be enclave participants because these are the sites where most Cuban-owned firms concentrate." Logan, Alba and Stults (2003) use another method to gauge the participation in an ethnic enclave economy, based on whether a given ethnic minority, by having a disproportionate level of minority employers and workers, is overrepresented in a set of a particular city's industrial sectors. Using the criterion of minority overrepresentation in industries, ethnic members who work as employers or self-employed persons in such industries are deemed to be participating in the ethnic enclave economy. The researchers also recognize the limitation of such a measurement, but adopt it because information on social relations is lacking in the census data (Logan, Alba and Stults, 2003: 348). Both measurements, whether founded on working or living in a city or on industrial overrepresentation, produce obvious measurement errors by including as enclave economy participants those who live or work in a large city or in overrepresented industrial sectors but actually work or run businesses in the non-enclave economy. However, these measurements are necessary compromises, given that data about features of social relations in the work setting are not available in past censuses.
Past research on the enclave economy also rejects equating the enclave economy to ethnic neighbourhood, since researchers stress the social dimensions of the enclave economy and not the neighbourhood concentration (Portes and Bach, 1985; Portes and Jensen, 1987). Again, the absence of data on linguistic and social features regarding the relationships between employers and workers, as well as between workers and clients, compels researchers to rely on crude measurements to make assumptions about participation in the enclave economy.
In this paper, the notion of the Chinese enclave economy in Canada is used to refer to an interrelated economic sector that is premised upon ethnic social relations based on common origin, similar language and shared cultural features; such relations enable Chinese-owned businesses to use a substantial amount of Chinese immigrant labour and rely heavily upon a Chinese immigrant consumer market for business development. This understanding of the Chinese enclave economy is consistent with the literature
that stresses the importance of social relations in characterizing the enclave economy. Thus, one feature of the Chinese enclave economy is the common use of a minority language understood and preferred by owners, workers and consumers at the place of work. Using this criterion, Chinese immigrant wage earners and entrepreneurs can be classified as participating in the enclave economy if they most often use non-official languages in the workplace, as opposed to their counterparts in the mainstream economy who most often use official languages there. This measurement fits the theoretical understanding of the immigrant enclave economy as an ethnically based social and economic system much better than the conventional method of measuring enclave economy participation using the location of work or residence within a city or using minority overrepresentations in a city's industries. The focus here is to use language at work to measure whether a person participates in the ethnic enclave economy, rather than use it to map out the terrains of the entire enclave economy. Typologizing participation in the Chinese enclave economy in this fashion enables testing the enclave economy thesis as...
|
