Work in Canada
Immigrants Shaping Canada’s Labour Force Until 2045, Says Conference Board
Immigrants are set to play a pivotal role, in shaping Canada’s labor force, economic growth, and trajectory. The Conference Board of Canada highlights the significance of ensuring that these immigrants find employment that aligns with their skills and education, considering that they will constitute a substantial portion of the country’s expanding labor force until 2045. In the blog, we will explore the key findings of the Conference Board’s report and the challenges and opportunities presented by immigration in the labor market.
The Immigration Dynamics at Present
As the federal government aims to welcome nearly two million permanent residents between 2023 and 2026, the emphasis on immigrants contributing meaningfully to the workforce becomes crucial. Statistics Canada’s mid-December report underscores the record-high population growth driven by robust permanent and temporary immigration, with 107,972 new permanent residents in the third quarter of 2023 alone.
Conference Board’s Report Insights
The Conference Board’s latest report, “Retirements, Migration and New Frontiers – Canada’s Labour Markets Outlook to 2045,” sheds light on the integral role of immigration for Canadian employers. While acknowledging the positive impact of temporary residents in addressing labor shortages, the report also delves into the challenges, particularly the issue of over-qualification among immigrants with foreign degrees.
Despite the ongoing success of immigration in filling labor gaps, the report raises concerns about potential overreliance on temporary foreign workers. While these workers contribute significantly to various sectors, the Board warns that excessive reliance might impede the adoption of automation, slowing down overall productivity growth in Canada. Thus, striking a balance is essential to foster healthy competition among firms, which, in turn, promotes investment in both physical and human capital, driving productivity growth.
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Canada’s Grand Immigration Gamble
Canada’s commitment to attracting permanent residents has a long history, reaching a pinnacle in 2023 with a record 465,000 newcomers. The underlying rationale lies in the nation’s demographic landscape, characterized by an aging population and a declining birth rate. To ensure growth, Canada is banking on immigrants, with projections indicating that immigration will not only drive the country’s labor force growth but also its overall population growth by 2045.
The recent announcement seeks to elevate immigration numbers to 500,000 annually by 2025, marking a 25% increase from 2021 figures. Canada’s distinct position in the world, with one in four Canadians being immigrants, surpasses G7 nations and underscores its unique approach to fostering population growth and economic prosperity.
Immigration Strategy of Canada
Canada’s immigration strategy deviates from conventional patterns, emphasizing economic immigration as a key driver. Unlike its counterparts, nearly half of Canada’s permanent residents are admitted based on skills, prioritizing economic contributions over family reunification. The government aims to further tilt this balance, targeting 60% economic immigrants by 2025.
This emphasis on economic immigration can be traced back to the 1960s when Canada transitioned from a quota-based system to a points-based model. This shift aimed to attract highly skilled individuals who could seamlessly integrate into the economy. Today, the points-based system remains a guiding principle, setting Canada apart globally.
Canada’s Shifting Identity in the Future
A recent poll conducted by Leger for the Association for Canadian Studies suggests that Canada’s population is poised to double in the next 30+ years, with nearly half of Canadians identified as racialized or visible minorities. This demographic shift highlights the transformative impact of immigration on Canada’s identity and emphasizes the need for strategic planning to ensure that immigrants continue to play a vital role in fulfilling and shaping Canada’s labor force.
