A new study has found that immigration, combined with the improved participation of under-represented groups of Canada’s labour force, is the best path forward to sustain the economic growth and high living standards of the country. The study, titled Can’t Go It Alone: Immigration is Key to Canada’s Growth Strategy, reached this conclusion after considering a variety of labour scenarios from the year 2018 to 2040. During this 22-year period, around 9.2 million Canadian baby boomers will be retiring from work, which means the demand for Canada’s publicly funded social services would be higher.
The study assumes that by 2040, nearly one-quarter of the population will be 65 or older compared to 17 per cent today. It means that if Canada does not find effective labour force growth solutions by this time, the country would face even greater pressure to fund the healthcare that its citizens increasingly rely on in their senior years.
Around 11.8 million students will also be leaving Canadian schools during the period from 2018 to 2040. They would constitute the bulk of the country’s workers and tax base. However, they will not be enough to make up for the 13.4 million workers who would be leaving the labour force during this period.
The study considered four scenarios for overcoming this impending gap in the labour force of Canada. The first was where there was no immigration to Canada during these 22 years. The other three scenarios considered the results of an immigration level of one per cent and increased labour force participation rates of women, Indigenous peoples and persons with disabilities-the groups that experience “large and chronic gaps” in labour force representation.
The study concluded that a fourth scenario that combined gradually rising immigration levels with increased labour force participation of women, Indigenous peoples and persons with disabilities was the “best path forward” for Canada. It is estimated that this combination would produce a net labour force increase of 5.9 million workers. This is comparable to the annual labour force growth between 2000 and 2017 and average annual real GDP growth of 1.9 per cent between 2018 and 2040.
This scenario is important not only in terms of benefitting the Canadian economy, but also because it would promote inclusive economic growth, alleviate poverty, and strengthen social inclusion and cohesion, according to the study.
Canada has a welcoming policy towards immigrants and they have realized that immigration is crucial for the economic growth of the country. If you too wish to immigrate to Canada, please get a free assessment to know your eligibility.