Hiring more foreign talent to balance the Canadian labour market. In his recent speech, Bank of Canada Governor Tiff Macklem spoke about how immigration may be the key to achieving labour market stability and correcting inflation. He stated that the Canadian labour market has more demand than labour supply.
The governor stated that labour shortages had increased wages across the country, pushing inflation upwards. Macklem urges Canadian employers to hire immigrants to meet the rising demand for labourers and fight inflation – with preference given to recent arrivals.
“The future of labour jobs” was the main topic of his remarks, which also covered the following topics:
- What are the causes behind the lack of available employees for businesses?
- The probability of a recession
- How does unemployment change during a recession?
- What part does the Bank of Canada play in maintaining the highest level of sustainable employment?
Macklem explains the relationship between labour, inflation, and immigration in Canada.
The following is a summary of Macklem’s talks regarding the importance of immigration in assisting in the balance of the Canadian labour market, with a focus on describing how businesses may increase the pool of available employees to address challenges in the Canadian labour market and growing inflation.
As he stressed that there is a shortage of workers in the Canadian labour market currently, Governor Macklem initially highlighted immigration.
The governor of the BOC says that increasing income pressure across the nation as a result of a labour shortage has increased inflation. In order to meet the increasing need for labour and consequently combat inflation, Macklem urged Canadian employers to keep recruiting immigrants, especially recent immigrants specifically.
“Increasing the number of labour is one way to balance supply and demand,” according to Governor Macklem,
he also noted that
“the more we can do on supply, the less we will need to do on demand.”
The BoC claims that more immigrants must be hired in order to better control high wages as “wages will have to slow to get inflation under control.”
Canada’s immigration situation as of 2020
The 2020 immigration slowdown that Canada experienced during the peak of the COVID-19 epidemic is examined in the study that follows. Nearly 100,000 employees fell short of the government’s immigration goal as a result.
As border restrictions resume, Macklem came to the conclusion that “immigration can help stabilize the job market in Canada.”
Following the release of the Immigration Levels Plan for 2023–2025, Canadian immigration levels have stabilized. In spite of the epidemic’s peak’s delayed immigration, Canada appears to be regaining and reaching even higher. Given that its immigration goals for the following three years reach 460,000. A total of 465,000 permanent residents will settle there within 2023, 485,000 in 2024, and 500,000 in 2025.
Canadian labour market benefits
In conclusion, immigration will benefit Canada’s economy, growth, and inflation stability, especially when compared to other nations. This is so because “high immigration targets predict that… immigration will account for almost two-thirds of the expected expansion in Canada’s potential production,” according to Statistics Canada.
In other words, immigrants increase the pool of potential workers in the Canadian workforce, which helps to counter the country’s decreasing workforce participation rate carried on by our ageing natural population and, as a result, helps to begin to address the economic issues we are currently facing.
To find out more details about “Hiring more foreign talent to balance the Canadian labour market” you can contact one of our immigration specialists at Gunness & Associates.
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