Immigration is the primary source of Canada’s labor force growth

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Immigration is the primary source of Canada’s labor force growth

From 2016 to 2021, 1.3 million new immigrants came to Canada permanently – the highest number of recent immigrants recorded in a Canadian census. 

In the 2021 Census, nearly one-fourth of the people counted were, or had ever been, landed immigrants or permanent residents in Canada. By 2032, it is projected that immigration will be the only driving force behind Canada’s population growth. 

The Canadian population is aging, and the share of working adults relative to retirees will decrease to 2 to 1 in 2035.

Canada’s labor supply has usually been driven mostly by immigration.

Immigrant recruitment is essential to Canada’s present and future success. Newcomers invest in the Canadian economy, create or launch enterprises, and fill labor shortages in Canada. Both employers and employees are considered economic immigrants. When they immigrate to Canada, they primarily become citizens. 


Labor market outcomes improve for new immigrants

In the years before the epidemic, recent immigrants’ labor market outcomes significantly improved. Since the early 2010s, core-aged (25 to 54 years) recent immigrants have seen their employment rate grow more quickly than their Canadian-born counterparts; from 2010 to 2021, their employment rate increased by 8 percentage points, compared to a 2 percentage point increase for workers who were born in Canada. In 2021, the employment rate for recent immigrants was 77%, for long-term immigrants it was 81%, and for Canadian-born immigrants, it was 84%.


The initial salaries of new economic immigrants likewise steadily increased. Between the entry batches of 2010 and 2018, economic immigrants’ first full-year-year earnings increased by 39%, contributing to an overall 35% gain for all new immigrants.

Since 2010, the share of new and recent immigrant workers grew the fastest in transportation and warehousing, professional services, and accommodation and food services.


In 2021, the proportion of new and recent immigrants working in the accommodation and food services industry, professional services sector, and manufacturing and transportation sector all reached 13%, 11%, and 10%, respectively.


Between 2010 and 2021, the number of people who were Canadian natives employed in the manufacturing industry decreased by 159,000, with new and recent immigrants making up some of that loss (+46,000).


Between 2019 and 2021, there were a significant decrease in the number of temporary foreign workers (TFWs) working in agriculture (-29%), accommodation and food services (-21%), and new immigrants (-31%) who were Canadian citizens.


To find out more details about “Immigration is the primary source of Canada’s labor force growth”, you can contact one of our immigration specialists at  Gunness & Associates.


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