The Royal Bank of Canada (RBC) recently released economic report shows that the government's decision to maintain the number of immigrants for the next 3 years is the right one.
However, in the long term, Canada still needs more people to stabilize the country's age structure and maintain a stable economy. The report points out that the current annual immigration rate in Canada is about 1.3% of the population, but it cannot stabilize the age structure because it needs to be at 2.1%. The Canadian government has also announced an immigration policy for the next 3 years, in which it will accept about 485,000 new people in 2024 and 500,000 people for each of the two years 2025 and 2026. RBC's report assesses this as a pause in the model of increasing the number of immigrants with each policy update.
From 2020 to 2023, the number of immigrants to Canada increased by about 36%. Compared to Canada's population growth rate over the past 30 years, the number of new immigrants only accounts for about 0.8%. Therefore, the country's immigration system is aiming to add 13 new permanent residents for every 1,000 people in each of the following years. In addition to immigration, Canada has also witnessed an unprecedented increase in international students and temporary residents over the past two years. Statistics show that the number of temporary residents and international students increased by 1.5 times the number of immigrants between 2022 and 2023. This group of temporary residents also contributes significantly to the number of new permanent residents each year.
The report recommends that the Canadian government address two issues in parallel. First, it should not limit the temporary population, as this could reduce the resources available to support the transition to permanent residence, who have contributed, and will continue to contribute, to Canada’s economic growth. Second, it should have a strategy for selecting immigrants and temporary residents that is diverse and not limited to highly educated occupations. This would contribute to a strong labour force and generate the benefits of current high immigration levels.
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