Canada’s Immigration policy is a systematic way of addressing labour shortages and increasing pension and health-care contributions. Canada has been a land of immigrants since the first European colonizers of the 16th century, a trend that continues today. Currently, annual immigration in Canada amounts to around 300,000 new immigrants – one of the highest rates per population of any country in the world. According to the 2016 Census, 21.9% of the Canadian population were foreign-born or immigrants.
In late October 2020, the Canadian government announced the most ambitious immigration plan in the nation’s history. Beginning in 2021, Canada is aiming to welcome more than 400,000 new immigrants per year.
Are these numbers on the high side? By international standards, it may be considered high. But as it relates to Canada, immigration is a means to an end. It is for economic survival. It is for sustainable taxpayer-funded systems like pensions and healthcare systems. Immigrants are required as important future contributors.
RBC Economics sees Canada welcoming 275,000 new permanent residents in 2021. And if this forecast is on the mark, the number will fall short of the country’s target of 401,000 arrivals this year.
Canada in 2019 grew by about 580,000 people, roughly 1.6 per cent, and 80 per cent of that growth occurred through immigration, helping to offset the country’s naturally aging demographic. The real estate market, health-care costs and university budgets all depend to one degree or another on immigration. Without immigration, the populations in Toronto, Montreal and Vancouver all would have declined in 2019.
To put things in context for a better understanding, there is a need to examine the peculiarity of Canada’s demographic distribution vis-a-vis the country’s labour force. Canada has an aging population and low birth rate. “Canada has one of the oldest populations, with nearly 18 percent of its population being 65 and over. It also has one of the world’s lowest birth rates at 1.47 births per woman”. These demographic realities will create economic and fiscal challenges in the years to come.
Immigration is mutually beneficial to both Canada and the immigrants. Without mincing words, Canada needs immigrants as much as immigrants need Canada. A major reason for this is that all of Canada’s nine million baby boomers (those born between 1946 and 1964) will reach retirement age by the end of this decade. A Financial Post publication reports that “Canada’s labour force is out of balance. During the next two decades, 13.4 million people are expected to exit the workforce, but only 11.8 million people will finish school and join the workforce… As people age and stop working, they no longer contribute as much to the health-care system, yet their health-care expenses during these years are likely to increase.” Thus, a heavy reliance on immigration to drive the majority of its labour force growth is expedient.
The pandemic may actually exacerbate Canada’s demographic pressures. Older workers affected by the pandemic may choose to retire early. There is talk that the economic uncertainty caused by the pandemic will cause the birth rate to fall even further.
Hence, welcoming more immigrants beyond the pandemic will help to alleviate these demographic pressures as it will support labour force growth and the country’s economic and fiscal recovery. The COVID-19 crisis can help us understand why immigration will be so crucial to Canada’s economy moving forward.
Yes, Canada’s economy looks set to contract in 2021. As such, one could make the argument that increasing immigration at this moment is not ideal since newcomers will be arriving in Canada at a time when the labour market will struggle to absorb them.
However, current events serve as a reminder that Canada’s immigration policies are largely proactive in nature, and since the late 1980s, the decision of the number of immigrants to welcome has been largely attached to economic conditions on the ground. Welcoming more immigrants is a futuristic policy.
The question should not be how many immigrants are here in Canada, the real question is who is making Canada prosper? Immigrants are on the driver’s seat.
By The Editorial Board.