Effects of Immigration on the Canadian Economy

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Effects of Immigration on the Canadian Economy
Canada is known globally as the “nation of immigrants”. Canada’s current population is currently almost 35 000 000 (34 957 572 and counting).1 Over 6 million (19%) of these are immigrants.2 Canada has a current immigration rate of 240 000 to 265 000 immigrants a year.3 Currently provinces Ontario, British Colombia and Alberta hold most of Canada’s immigrants, with 28% in Ontario, 27% in British Colombia, 16% in Alberta and the remaining 29% scattered throughout the country.2 Many Canadians believe immigration harms the economy as jobs are taken by immigrants. In reality immigration is very beneficial to the Canadian economy. Canada is highly reliant on immigration to keep its economy growing. Also immigration increases productivity. And finally, the biggest benefit of immigration is that immigrants increases demand.

In comparison to most developed countries, Canada has a very low population. With an area of 9 985 000 km2, it only has a population of 34 957 779.4The United States for example on the other hand has an area of 9 827 000km2 and has a population of 311 591 917.4 Like many other countries Canada also has a declining birth rate. Some reasons for this are, women focusing more on their careers, rather than starting a family, couples having children later in life as a result of delayed marriage, or have less children as not as many children are need (children were needed in the past to work on farms, and as many didn’t survive the first five years of life, couples had many in hopes some would survive), no longer need of male heirs, etc. Due to declining birth rates without immigration, Canada’s population would be increasing at declining rates. Immigration contributes greatly to the growing Canadian population. (Refer to figure 1) Canada has a current birth rate of 1.9* in comparison to the birth rate of Canada in 1960 which was 3.9 children per woman.5 (Refer to figure 2) 42.2% of the population is baby boomers.7 (Refer to figure 3) As the baby boomers get ready to retire Canada should have more than enough young people ready to replace and support them. The ratio of retirees to workers should ideally be 1:8.10 Canada was pretty close when the baby boomers were between the ages of 13-19 with the ratio standing at 1:6.11 Today the ratio is 1:3.11 If the was 1:1, it would mean more job availability. But on the contrary it would also mean, higher taxes, as money is needed to support the retiring and for pensions, also it would mean employers have less choices when hiring worker (if there is only one applicant, qualifications hold no importance) and finally a 1:1 ratio would make it difficult for the population and economy to grow. If immigration is not allowed if immigration is not allowed in Canada, Canada’s future would be much like that of japan. Japan’s current population is 127 817 2274 and is expected to drop to 87 million by 2060.14 (Refer to figure 4) Japans economy is now struggling as it has a birth rate of 8.38/100015 and an ageing population of 23.9 %.16 (Refer to figure 5) The ratio of japans retirees to workers is 2:1 this means there are only 2 working people available to support 1 retired. 16 Andrew Coyne, a columnist in the National Post proposed, Canada should increase its immigration to 850 000 a year, and David Baxter, an expert Demographer who interviewed for the Globe and Mail believes Canada should increase its population to “avoid the unspeakable: a population that stops growing.”18 Although this seems very extreme currently, it may very likely happen according to current reports sometime in the future.

As according to recent research immigration is more of a “need” than a “luxury” (want), to the Canadian economy, but there are definitely some “luxurious” benefits gained from it. In comparison to Canada who only allows in of 240 000 to 265 000 immigrants annually3, The United States allows in 651 000 immigrants a year.12 This can be a...
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