OTTAWA - A new report suggests immigrants to Canada are highly educated, but struggling to meet their potential.

The study by the Federation of Canadian Municipalities notes that recent working-age immigrants are twice as likely to have a university degree as other Canadians.

But these same immigrants are four times more likely to be unemployed, and far less likely to draw economic benefit from their post-secondary degree, than other Canadians.

University-trained immigrants aged 25 to 54 had an unemployment rate of about 12.1 per cent -- barely below the overall 12.8 per cent unemployment rate for all immigrants in that age category.

By comparison, the unemployment rate among university-trained non-immigrants was three per cent -- about half the unemployment rate of 5.6 per cent among non-immigrant Canadians in that age group.

On the bright side, the gap narrowed somewhat for immigrants who spent over five years in Canada.

In a 60-page report, containing mostly census data gathered from Statistics Canada, the federation stresses the need for more settlement services and better co-ordination between governments.

Ottawa is spending $68 million over five years to speed up the recognition of foreign credentials in order to get educated immigrants into the workforce faster.

Recognition of foreign credentials involves professional orders, like doctors' and engineers' associations, and is generally handled at the provincial level.

That grinding process is a main barrier to employment for immigrants.

The federation said municipalities need more money -- and that the money can't come from municipal coffers.

It did not put a price tag on municipalities' needs and said little about how any additional money would be used. It mentioned public transit, housing, and settlement services as possible examples.

"As a country we must take a broader view of immigration policy," said federation president Jean Perrault, mayor of Sherbrooke, Que. "We cannot afford to shift these costs onto already over-burdened property taxpayers. . . .

"Municipalities need to be viewed as partners."