Canada needs to be accepting an extra 100,000 new immigrants per year by 2030 to get anywhere near sustaining current levels of economic growth.
These new immigrants need to be younger, but they would still only offset some of the effects of Canada’s aging population.
That is the key finding of a new study by the Conference Board of Canada, which looked at the long-term needs of Canadian society.
Current immigration levels have already beaten record modern-era highs, with more than 320,000 newcomers welcomed in the 12 months to June 30, 2016.
This confirms the government is likely to surpass its projected number of 305,000 immigrants for 2016.
Source: Statistics Canada
Matthew Stewart, an Associate Director at the Conference Board, urged Canada’s politicians to get creative with their solutions.
“Immigration provides an important source of labour and helps Canada generate stronger long-term economic growth,” Stewart said.
“However, increasing immigration alone will not reverse Canada’s aging trend.
“In order to fully address the significant cost strains on the Canadian system from an aging population, policy makers must also consider other solutions.”
Highlights of the Conference Board of Canada Report
- Share of Canada’s population aged 65 and over is expected to increase from 16 per cent to over 24 per cent over the next 20 years.
- Increased immigration levels to 407,000 per year by 2030 would help boost Canada’s labour force and generate stronger long-term economic growth.
- But, higher immigration levels only soften the cost strains on the system, meaning Canada needs to consider other solutions to fully address the impact of an aging population.
The report predicts that if the current situation is allowed to continue, labour supply shrinkage will cause Canada’s economic growth to slow from an average 2 per cent to 1.6 per cent by 2050.
The growing number of older people will also put a strain on health care, according to the report.
It states: “Without significant changes to how health care is delivered in Canada over the next 20 to 30 years, the share of government revenues directed to health care is expected to rise from 37 per cent today to 44 per cent. With the provinces already struggling with large deficits, this added burden would be unsustainable.”
Figures show the percentage of immigrants in the working-age population has been steadily increasing for the last decade as the Canada-born proportion drops, illustrating the need to make up for the shortfall by bringing in foreign workers.
In 2006 less than 20 per cent of the workforce – those aged 15 and over – were from the landed immigrant population, while more than 78 per cent were born in Canada.
But fast forward 10 years and the latest data released by Statistics Canada shows an immigrant percentage just less than 24, while the Canada-born proportion has dropped almost as low as 74 per cent.
Source: Statistics Canada
Source: Statistics Canada
Immigration Minister John McCallum is currently pursuing support within the federal government for significant increases to immigration levels over the next three years.
McCallum believes, like the Conference Board report, that plugging the gap caused by Canada’s aging population and lack of high-skilled technology workers is crucial to the country’s continued economic growth.
McCallum`s Immigration Plan
- The Liberals made family reunification a key element of their campaign for election, and McCallum is looking at ways to speed up the whole process of bringing in immediate family members.
- There are also plans to make it easier for international students to stay in Canada after they graduate. McCallum feels these young, Canadian qualified, Canadian experienced individuals are the perfect candidates to become new permanent residents.
- McCallum also plans to address the technology talent shortage in Canada by making it easier to bring in new immigrants with the right qualifications.
- Limitations on the Temporary Foreign Worker Program are set to be relaxed, with a report into the current state of the program expected to be released in September.
- McCallum has already given Atlantic Canada the freedom to bring in 2,000 more immigrants under Provincial Nominee Programs in 2017. These numbers could rise in 2018 and 2019 if the increase is seen as a success.
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