New Report Suggests Canada Could Handle Up to 450,000 Newcomers Annually
Canada is a large country but has a comparatively small population. A low birth rate and aging population mean the Canadian population isn’t growing as fast as it could. In turn, there won’t be enough workers to fill gaps in the workforce once all Baby Boomers have retired. As a result, the economy will grow just as slowly.
Thankfully, there is hope. Immigration has been cited as a key way to grow the population and provide support to economic growth. According to an article from Global News, the federal government plans to announce its 2018 immigration target numbers by November 1, 2017.
Raising the Bar
Canada’s current immigration intake numbers are set at 300,000 annually or about 0.8 percent of the country’s population. However, the government has been looking at increasing this number and what it could mean for the rest of the country in terms of economic growth.
The government’s Advisory Council on Economic Growth recommends increasing the target immigration numbers to 450,000 annually by 2025 (about 1.1 percent of Canada’s population) and leaving that target number in place until 2040.
A new report from the Conference Board of Canada looks at the possible outcomes of these population targets for the future of Canada. If Canada were to leave the targets as is, Canada would face slow economic growth and higher health-care costs.
Aging Populations and the Economy
The decrease in Canada’s working-age population would lead to slower economic growth. Canada’s population is aging as a result of low birth rates and the large Baby Boomer generation entering retirement age. With more job vacancies, fewer workers, and fewer people contributing to the economy, the economic outlook for Canada isn’t bright. But an increase in immigration numbers could help.
If the immigration target increased to 450,000 annually by 2025, Canada could expect economic growth of two percent per year. Those who immigrate to Canada tend to be younger and working-age. They could help fill the gap that retiring Baby Boomers will leave in the workforce and keep Canada’s economy steady.
The main issue with an increase in immigration numbers is the lower wages that newcomers earn. New arrivals typically earn about 83 percent of the national average wage. This could decrease the country’s per capita GDP. But there is one sure way to rectify this wage disparity: allow newcomers to work at higher-paying jobs that they are qualified for. Many newcomers hold post-secondary education that remains unrecognized by Canadian employers, leaving them stuck with low-income jobs instead of continuing on their career path.
A target of 450,000 per year may seem high. But given Canada’s long-term future, it may not be enough to fill the shoes of retiring Baby Boomers. Canada benefits from welcoming more young and skilled newcomers to meet the needs of the workforce and strengthen the economy.
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Arghavan Gerami
Arghavan Gerami is the Founder and Senior Counsel at Gerami Law Professional Corporation ('PC'), a full-service immigration law firm in Ottawa, Ontario. Since 2011, Ms. Gerami has focused her practice on immigration and refugee litigation. Prior to that, Ms. Gerami worked at the Ministry of Attorney General and the Department of Justice and had the privilege of serving the Honourable Mr. Justice M. Evans at the Federal Court of Appeal on immigration and administrative law appeals. Ms. Gerami contributes to the Immigration Law Section of the Canadian Bar Association, the Canadian Association of Refugee Lawyers, and the United Nations High Commissioner for Refugees. Ms. Gerami has also published numerous journal articles and presented at various immigration and refugee law conferences and events across Canada.