Immigration to Canada According to the CIA's
World Factbook (2017), Canada has one of the highest migration rates in the world. Canada is also unusual among
western nations in the widespread popular support for high rates of immigration, and a 2007 study showed support for immigration has increased in Canada despite its impact on cultural erosion. Canada's immigration policy, which focuses on selecting immigrants based on their skills and qualifications to meet labor market demands, as well as supporting irregular immigrants in need, reinforces the public perception that immigrants are making a positive contribution to the economy and that the system preserves human
dignity as economic conditions permit. However, assessing the economic effectiveness of the immigration policy is challenging due to the complex interplay of capitalist dynamics, societal influences, and political factors on the lives of immigrants. In 2023, a Statistics Canada report revealed that the notion of a widespread labor shortage in Canada is no longer substantial. The report found that jobs requiring higher education consistently had fewer available positions and highlighted that the hiring challenges for positions requiring post-secondary education are not due to a lack of qualified workers but because of a mismatch in skills that could be solved with ongoing training and deflated entry requirements, and inadequate wages that could be fortified with desirable benefits or competitive wages. The report also raised doubts about the hiring difficulties faced by firms trying to recruit workers with lower levels of education. It raised questions whether these job vacancies are solely a result of labor shortages in specific low-skilled occupations that might demand higher wages or if factors such as greater negotiating power and
profit maximization that the low-skilled industries enjoy play a significant role. According to Jim Stanford, an economist and the director of the Centre for Future Work, the goal of immigration policy should not be solely focused on solving recruitment problems for low-wage employers or to bolster the mass immigration industrial complex, but rather on broader considerations that benefit the country and its people as a whole. In 2024, despite years of per capita recession and housing affordability issues, the Liberal government has increased the intake of permanent residents, issuing around 35,000 invitations per month and boosting the population by over 410,000 within the first four months of the year, a 47% increase compared to the same period in 2023. Concurrently, Canada is rapidly transitioning temporary residents holding jobs that require basic college education. The immigration department also outlined its plans to offer permanent resident opportunities to individuals with educational backgrounds ranging from none to a maximum of high school education, aimed at meeting the demand for cheap, low-skilled labor through programs like the Canadian Experience Class, without considering the long-term negative impacts. A Fraser Institute study indicates that Canada's standard of living is on course for its sharpest decline since 1985, with a rapid deterioration starting in mid-2019. An Ipsos survey of 1,001 Canadians indicates that many feel their institutions are broken, suffer from personal underachievement due to a lack of rewarding opportunities, and have lost a sense of togetherness, with most concluding that the "country is broken." Additionally, a report from Food Banks Canada estimates that 1 in 4 Canadians are living in poverty. Meanwhile, Australian economists are using Canada as a cautionary example for Australia's economy if their government continues with extreme immigration policies.
Economic rationale for immigration , a migrant from
Scotland, drives the
Last Spike.
Migrants to
Canada at that time were
British subjects (not
Canadian citizens). There is no agreed view on the net impact of immigration in current times. Historically, Canada's unusually high immigration rates can be traced to the nation's unique economy. Another factor is that Canada has one of the world's largest supplies of natural resources such as oil, metals, and lumber. It also has a sparse population spread over a vast landscape. Canada has thus faced acute labour shortages and has responded by actively searching for immigrants. In the late 19th century this included bringing Chinese migrants to build the
Canadian Pacific Railway and actively advertising in Europe to find farmers with the
Last Best West campaign. Today similar recruitment efforts are needed to staff the
oil sands projects in Alberta. . Another factor that contributes to the immigration question is Canada's low
birth rate (10.3 births per 1000 people). The theory is that new residents can assist in meeting future government obligations relating to pay-as-you-go liabilities. The economic dangers of
population decline are not universally accepted. Organizations like the
Fraser Institute question whether a declining population would reduce or increase per capita income, noting that in the short term, with a stable economy, fewer people would increase the per capita income simply because you divide the income among fewer people. This would increase per-head consumption and create a climate of economic well-being that could nurture pro-family values and policies which can increase Canada's birth rate. A study by the
C. D. Howe Institute suggests that immigration cannot keep Canada's population young and could possibly contribute to
population ageing in the near term. Due to socioeconomic processes and increased levels of immigration, skilled worker immigrants are being converted into a
precariat class, with a 34% unemployment rate in 2001, raising questions about whether they are successfully meeting existing labor market needs in Canada. This class conversion among landed immigrants in 2020 was shown to be 9.5%, according to the unemployment rate. The first detailed analysis of Canadian immigration policy came from the
Economic Council of Canada; it called for immigration to be increased to eventually bring Canada's population to 100 million. While it found that the economic benefits to Canada of immigration were fairly small, noting that "a historical perspective gives little or no support to the view that immigration is needed for national prosperity," it also concluded that the benefits to the newcomers themselves were extremely large. The report concluded that "it would be hard not to recommend an increase when immigrants can gain so much and Canadians not only do not lose but actually make slight economic gains." Economists from the libertarian-conservative Fraser Institute later conducted a series of studies using large amounts of census data (844,476 individuals) and found out that immigrants who arrived from 1987 to 2004 paid only 57% of the taxes paid by average Canadian in 2006, with the effect that taxes from immigrants do not exceed the government expenses relating to them (a gap of $23 billion annually according to their numbers).
Racialization and its Economic Impact Recent immigrants are far more likely than native-born Canadians to have low incomes initially, due to differences in culture, difficulties due to English being their second language,
discrimination, and
racialization. The employment equity policy prescriptions are not translated into programs that help immigrants to participate in the economy on an equal footing with other Canadians in a hostile labor market. All of which, a native-born Canadian initially would have to get into a workplace. A 2006 Canadian government report shows that 22 percent of
racialized persons lived in poverty compared to 9 percent of non-racialized persons, and in major cities more than half of the people living in poverty were those who were racialized, and the comparative poverty rate was growing. Later, in a 2019 study, it was found that the rate of poverty amongst recent immigrants is 2.4 times higher than that of native-born Canadians, and this was identified as an ever-widening trend. In certain cities there are active local immigration partnerships that aid immigrants in getting jobs, however a network of community based wraparound services through existing
community organization's are not available. A 2001 study found successful
interpellation is possible if young people are considered for immigration, the study found a positive correlation between age and earnings for immigrants with
acculturation effect, and the study observed it in immigrants who were visible minorities or whose mother tongue was not English. A 2003 study found that with then lack of support systems that can directly address socioeconomic problems of immigrants in a
racialised society, and related lack of qualitative job accessibility, it would take more than 20 years of Canadian experience to achieve any positive economic gains. Established studies show educational achievement and rewriting policies to recognise education is critical for gaining higher incomes for overcoming the
poverty trap and achieving poverty reduction. On an intergenerational level, if parents can avoid poverty, so will their children. In Canada's case, with its high-skilled immigration model, it is partly about being insulated from racialization at various levels.
Positive impact Immigration has become a dominant driver of
Canadian economy and population in the 21st century. By 2021, nearly one quarter (~23%) of Canadian population was foreign born, the highest share since confederation. Canada's working-age population growth has been almost entirely due to immigration. Over the past two decades, immigration has exerted a net positive impact on the Canadian economy, primarily through its contributions to population expansion and labor force augmentation, which have significantly driven
gross domestic product (GDP) growth and fostered innovation. Furthermore, immigration has played a pivotal role in addressing critical skill shortages, enabling the fulfillment of labor market demands in essential sectors, including
engineering,
medicine,
healthcare, and various other specialized fields. At the same time, immigration has posed challenges such as housing strain and problems with societal integration of immigrants.
Economic Output Immigration substantially boosts GDP by expanding the labour force and consumer market. An analysis by
Bank of Canada finds that immigrants have added roughly 2.5 percentage points to Canada's potential output in just two years (2023–24). Similarly,
Scotiabank estimates that, without the immigran population of
Quebec and
Ontario (~17% and ~34% of working age respectively), Ontario's GDP would be 20% smaller and Quebec's 9% smaller. Immigrants also have contributed in growth of two-thirds of Ontario's work force since the mid-2010s. Immigration also boosts overall labour-force participation. Recent immigrants (<10 years) have contributed to the rapid rise of employment rates. Between 2010 and 2021, the employment rate for core-aged immigrants rose 8 points to 77%. After the 2020s, most immigrants enter with postsecondary credentials (over 80% of Ontario's recent immigrants are university educated), and often have pre-arrival work or study experience, which improves the labour market attachment.
Wage dynamics and effect on income Immigration has nuanced effect on wages. Recent Canadian data shows strong growth in immigrant earnings, especially entry wages. In 2022, the real median entry wage for new immigrants rose by 6.7%, even though the median wage of all Canadians dropped by 1.6%. Economic class immigrants consistently earn the most, in 2022 skilled economic principal applicants had a median first-year wage of $52,400. The
immediate wage impact on Canadian-born workers appears minimal in the short term. However, studies reveal a growing wage gap between non-permanent immigrants and their Canadian-born counterparts, increasing from 9.5% in 2006–14 to 22.6% in 2023–24, indicating that Canadian-born workers consistently earn higher wages.
Productivity and innovation Immigration affects productivity in complex ways. On one hand, high immigration has diluted measured
average labour productivity, due to the occupance of low-skilled jobs. The
OECD notes that Canada's GDP per capita has lagged peers partly because
"lower productivity of recent immigrants, comprising many low-skilled non-permanent residents", weighed on output per worker. On the other hand, immigrants contribute specialised skill and innovation. Research consistently finds immigrantion brings positive human capital. For example, firms owned by immigrants with a
doctorate had ~16% higher labour productivity than firms whose owner had only a high school diploma. Firms owned by immigrants holding a
master's degree were among the most productive firms in Canada. Moreover, a large share of recent immigrants have
STEM background (nearly 1.4 million in 2021), enriching Canadian innovation capacity. OECD and Bank of Canada report that strong non-permanent immigration has led to increase in unsustainable housing demand, adding pressure on prices and rents. For example, Ontario's foreign students contributed $16.9 billion to GDP in 2022, most of the funds circulated around housing and services.
Public finances and fiscal impact Immigrants affect public finances through taxes paid versus services used. Many analyses find that working age immigrants pay significant taxes. For instance, immigrant entrepreneurs in Canada pay 16% more taxes per employee than firms majority owned by Canadian-born citizens. While international students' spending indirectly generated $7.4 billion in tax revenues in 2022. Furthermore, two-thirds of recent immigrants are prime working age adults, helping to fund pensions and healthcare by expanding the tax base. In aggregate, economists generally conclude that skilled immigrants contribute more in taxes over their lifetimes than the cost of public services they consume such as subsidized healthcare, education, etc.
Regional variations Immigration impact can vary by province and territory.
Ontario absorbs roughly half of the new immigrants. A recent report noted that immigrants now comprise 34% of working class in the province. These immigrants have driven high growth; in 2021 Scotiabank estimated Ontario's GDP would be C$157 billion (20%) lower without its immigrant workforce. British Columbia has one of the highest migrant concentrations. According to the 2021 Canadian census, 42% of population of
Vancouver is foreign born. The province offers various opportunities in tech, film, healthcare, education and service industries. In 2022, international students in BC contributed around $5.7 billion to GDP. ==Immigrant wellbeing==