Canada has been accepting immigrants for over a century and maintaining a welcoming and inclusive policy towards immigrants. In Canada, it’s a proven fact that immigration increases economic growth as well as job creation. Canada introduced a points system for immigration in 1967, intending to make the immigrants’ selection process more objective. The applicants began to be prioritized based on their ability to succeed in Canada economically.
Over the past few years, Canada has steadily increased the number of immigrants admitted to the country each year. In 2019, immigrants accounted for over 80% of Canada’s population growth. The country welcomed a total of 341180 new permanent residents in the year. About 58% of them were accepted under the economic category. Though Canada had plans to take 341000 new immigrants in 2020, it could welcome only 184000 newcomers owing to the border restrictions caused by COVID-19. But for 2021, Canada has set a higher target as it plans to receive more than 400,000 new immigrants in the year.
Immigrants’ contributions to Canada’s population, economic and cultural growth were significant, and that is why Canada needs more immigrants. The 2020 Annual Report to Parliament on Immigration states, “Immigration has helped to build the country that the world sees today – a diverse society with strong economic and social foundations, and with continued potential for further growth and prosperity.”
Canada is dependent on immigrants for the social and economic development of the country. Here are the primary reasons why Canada is keen to welcome more immigrants:
Shortage of skilled workers
Canada is facing worker shortages in several high skilled professions such as engineers, doctors, nurses, etc., and that is one reason why Canada needs more immigrants. Besides, the population growth in some provinces is dismally low. So the employers find it difficult to fill their vacant positions. Canada sees immigration as a means to overcome this crisis.
As per the Immigration Levels Plan for 2021-2023, the country will be welcoming more than 4 lakh immigrants every year. Among these, 60 percent would be Economic Class immigrants.
Post-COVID economic recovery
Canada believes that immigrants have to play a crucial role in the post-COVID economic recovery of the country. This is a significant reason why Canada needs more immigrants and is planning to welcome many immigrants to the country in 2021, despite the restrictions and obstructions caused by the pandemic.
Canada needs more immigrants for short-term economic recovery and long-term economic growth. The newcomers already constitute a significant part of the workforce in hospitals and care homes, and the food and agriculture industries. Besides contributing their skills towards the growth of businesses, they support the Canadian economy by starting businesses and creating more jobs.
Low population growth
Canada expects that by the early 2030s, its population growth will rely exclusively on immigration. Between 2017 and 2018, net immigration accounted for 80% of Canada’s population increase, with only the remaining 20% accounted for a natural rise. Between 2018 and 2019, Canada’s population growth was at 1.4%, which was the highest growth rate among G7 nations. In this period, the increase in population (over 531,000 people) was overwhelmingly driven (82%) by immigrants and non-permanent residents.
Driving economic growth
It is no secret that immigrants play a remarkable role in the economic growth of the country. They do so mainly by filling the gaps in Canada’s labour force. According to statistics, one in every four workers in Canada is an immigrant, who constitute almost 26% of Canada’s total labour force. In 2016, immigrants accounted for over one-third of nurse aides, orderlies, and patient service associates in Canada. Further, immigrant owners of small and medium-sized enterprises also successfully introduce new products, processes, and marketing innovations into the marketplace.
Antidote to an ageing population
The population of Canada is ageing fast. Life expectancy is increasing, and the number of births is decreasing in the country. It is estimated that by 2040, 25 percent of Canada’s population will be above 65. Currently, it is 17 percent. Canada depends on immigration to maintain a healthy population growth level and keep the population younger.
Canada needs taxpayers to continue providing pensions and free healthcare to aged citizens and residents. Fewer workers in the country mean lesser contributions in the form of taxes to the plan, which will be disproportionate to an ageing population’s growing healthcare needs. It will lead to either worker having to contribute more or beneficiaries having to be paid less. As natural population growth is low in Canada, increasing the population through immigration is the only way to increase taxpayers’ number.
In 2017, the provincial spending on healthcare, on average, was 35 percent. This is expected to rise to 40 percent by 2040. So scaling back immigration will lead to a rise in healthcare costs.
High retirement rate
In the coming decade, Canada will experience a significant rise in retirement rates because a high percentage of workers in the baby boomer generation will be retiring. When these workers retire, they stop contributing to the healthcare system. So when the cost of healthcare increases, the number of workers who contribute towards it decreases. Immigration helps to keep the population young and thus avoids such a situation.
Another challenge that Canada will face if it cuts down immigration levels is the imbalance in labour supply. It is expected that in the coming decade, 13.4 million people will exit the workforce in Canada. But to replace them, Canada has only 11.8 million people, who will then be finishing school and joining the workforce. So, in the absence of immigrant workers, it will pose a challenge for employers and investors to fill vacant positions.
Sustain a healthy level of GDP
Studies show that, without immigration, Canada’s GDP growth would drop to 1.1 percent by 2040 as businesses would not be growing without workers. But if the immigration level is raised even by one percent, it would result in GDP growth rising by around 1.7-2 percent. So Canada needs more skilled workers to retain a healthy GDP growth rate in the country.
Tax burden on the population
In the absence of immigration, the tax burden on Canada’s population will increase multifold. According to a study, the tax burden on future generations would be around $200000 more than the net taxes paid by Canadians born in 2017. Immigrants come to Canada as economic class, family class, and refugees. The labour outcomes of each class is different as some integrate into the economy more quickly than others. So the Government needs to find the right balance among these classes based on Canada’s economy, geopolitics, and happenings around the world.
Unemployment levels remain the same
Canada is a country that has one of the lowest levels of unemployment. Though the COVID pandemic caused a rise in unemployment levels, typically, Canada maintains its unemployment rates down. The reason is that Canada has a fast-growing economy, and new jobs are created in different industry sectors. So Canada needs immigrants to fill the job vacancies. Immigration helps the employers of Canada fill vacancies with workers with suitable skill sets and thus sustain business growth.
Canada, as a growing IT hub, needs more foreign skilled workers
The IT industry in Canada is growing fast. Even during the Covid, the IT industry continued to expand and hire foreign workers. A significant reason for the growth of the IT sector in Canada is the favourable environment. This is happening when the IT industry in the US, which has long retained its position as a global leader in IT, suffered a setback due to the shortage of foreign IT workers caused by the tighter immigration policies. At the same time, Canada has initiated several measures to attract skilled workers in IT. A major step in this direction is the Global Talent Stream that allows tech workers with a job offer to come to Canada in just two weeks. The largest proportion of skilled workers invited by Canada through Express Entry last year was also tech workers. Further, provinces like British Columbia and Ontario conduct tech- draws that exclusively target tech workers.
Growth of Canadian communities
Immigration is necessary to ensure the growth of Canadian communities. So the Canadian Government has launched several immigration programs aimed at the growth of communities by attracting a wide range of skilled immigrants to contribute to their economies.
One of the major ways adopted by the Canadian Government to promote communities’ growth through immigration is the Provincial Nominee Program. A major share of newcomers coming to Canada every year is through PNP programs. The Atlantic Immigration Pilot program is yet another immigration program with an employer and retention-driven approach to promoting the economic development and labour needs of Atlantic Canada. Another program launched by the IRCC is the Rural and Northern Immigration Pilot that aims to support smaller and more remote communities that enjoy the economic benefits of immigration. The Agri-Food Pilot, launched on May 15, 2020, offers a new pathway for experienced non-seasonal workers in specific agri-food industries and occupations to permanent residence in Canada. Municipal Nominee Program is another community development program.
Canada will be admitting a high number of immigrants in the coming years. If you are planning to migrate to Canada, start the process now. For more information, contact ImmiLaw Global, the best Canadian immigration consultant in Kerala.
