As Canada grapples with an aging population and a shrinking pool of available workers, it has increasingly looked to immigration to fill the gap.
This week, Canadian immigration officials signaled that they have no plans to change course, unveiling a new plan that looks to immigration, particularly for skilled workers, as a pillar of Canada’s economic growth.
The plan, unveiled by Immigration, Refugees and Citizenship Canada, keeps immigration targets the same and aims to stabilize the number of immigrants after 2025. Canada is now set to allow 485,000 new immigrants next year, and 500,000 in both 2025 and 2026.
Of those new arrivals, the majority—58% in 2024 and 60% in 2026, for a total of 281,000—will be admitted under the economic class. The rest will be classified as refugees and family members, and they will be able to join the workforce.
Without the new arrivals, Canada’s economy faces severe constraints. Immigration is responsible for 98% of Canada’s population growth and over 90% of net workforce entrance. Even a temporary slowdown in immigration, like in 2020 during the pandemic, resulted in severe labour shortages only to be relieved with new immigrants.
Because Canada’s immigration policies can be flexible and adapt to changing needs, immigration targets can be adjusted to fill gaps in industries with shortages, including construction, trucking and health care. But finding new doctors will continue to be an issue; an arduous licensing process still prevents most foreign-trained doctors from practicing in Canada.
To be sure, there are challenges associated with high immigration numbers, including shortages of housing, social services and infrastructure.
Indeed, more immigrants, citing these challenges, are choosing not to stay in Canada several years after arriving.
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But these shortages are nothing new, the result of decades of underinvestment in housing and public services. And they will take years to fix.
Curbing immigration will not solve these issues. Instead, fewer immigrants would mean fewer construction workers to build housing, fewer health care workers to treat patients, fewer agricultural workers to provide food, and an overall shrinking of the workforce.
Instead, there are solutions that will help make immigration a benefit for Canada. Making housing construction easier and cheaper would increase the housing supply. Substantial investment in public infrastructure and social services is also essential to meet households’ needs.
The takeaway
For the Canadian economy, the benefits of immigration far outweigh the costs. By not slashing targets, Canada ensures that the labour supply will continue to grow.
Whether it is housing, infrastructure, health care or other social services, the solution, despite any challenges that immigration presents, is to boost it, not to curb it.
