Skilled Workers and Long-Term Economic Growth: Focus of Canada's Latest Immigration Levels Plan
Under the current Immigration Levels Plan, The federal government is progressively lowering total admissions of permanent and temporary residents in comparison to prior years. Despite this, Canada still sees immigration as a key factor in economic growth.
Economic Immigration Remains Top Priority
Economic immigration continues to account for the majority of permanent resident admissions, despite changes to overall immigration targets.
Immigration, Refugees and Citizenship Canada (IRCC) projects that by nest year, economic immigration will make up roughly 64% of admissions for permanent residence, the largest percentage in over ten years.
Greater Focus on Workers Already in Canada
One of the most significant changes in the recent immigration plans is the increased emphasis on helping qualified temporary residents in Canada transition to permanent residence. As a matter of fact, IRCC has indicated that many future permanent resident admissions will come from individuals who are already living and working in Canada.
More Sustainable Immigration Planning
For the first time ever, Canada’s Immigration Levels Plan also includes targets for temporary residents, including international students and temporary foreign workers. The objective is to better manage population growth while ensuring employers continue to have access to qualified talent where shortages exist.
At the same time, Canada remains committed to strengthening Francophone communities outside Quebec by increasing the share of French-speaking permanent residents in future immigration levels, one step at a time.
The Future in Canada
Canada’s immigration strategy continues to evolve, but one priority remains consistent: attracting skilled workers who can contribute to the country’s long-term economic success.
In a previous report, RBC projected the necessity for Canada to elevate its immigration intake to maintain the nation’s demographic structure and fulfill the requirements of its labor market. This recommendation comes in the wake of the Canadian government’s announcement on November 1, regarding the Immigration Levels Plan for 2024-2026, which plans to maintain immigration targets at 500,000 annually for both 2025 and 2026.
The Imperative for Increased Immigration
Canada’s dependency on immigration is driven by its aging population and low birth rate, challenges that are not unique to Canada but are particularly acute given the country’s inability to naturally replenish its working-age population. Immigration serves as a critical strategy to augment Canada’s demographic shortfall, especially vital for supporting its robust economy, which ranks as the ninth-largest globally by Gross Domestic Product (GDP).
Rationale Behind Raising Immigration Levels
The core argument of the RBC report is that the current immigration quotas fall short of what is required for Canada to sustainably address future labor market demands. To match the labor needs prompted by economic expansion, the report posits that Canada must reach an annual immigration rate of 2.1% of its existing population. This implies that to counterbalance the declining natural population growth, immigration numbers would need to see an annual increase by over 300,000.
The RBC report strongly suggests that without a significant uptick in immigration levels, Canada may struggle to meet its labor market needs, stimulate economic growth, and uphold the funding and functionality of essential services such as healthcare, infrastructure development, including housing, and other societal institutions.
