Canadas Labour Market

Canada’s Labour Market Requires Higher Levels of Immigration: Here’s Why

In the 2010s, immigrant workers accounted for 84% of the growth in the total labour force. Moreover, they offset the decline in lower-skilled jobs among Canadian-born workers. Since 2010, the shares of new and recent immigrants also grew the fastest in transportation and warehousing, professional services, and accommodation and food services.

“Immigration has always been the driving force behind Canada’s labour supply,” said Statistics Canada in its latest research. However, with job vacancies in the first quarter of 2022, 72.3% higher than in the first quarter of 2020, high levels of immigration will be even more critical to the labour market.

The Canadian labour market continues to recover, and data shows that Canada’s job vacancies climbed to 957,500 in the first quarter of 2022. This is the highest quarterly number on record. 

<<Also Read: Canada has a record high of 1 million job vacancies>>

Immigrants fill labour shortages in Canada

According to the “Research to Insights: Immigration as a Source of Labour Supply,” in 2021, recent immigrants (in Canada 10 years or less) made up 8% of the total employed labour force. But, it accounted for: 

  • 13% in the accommodation and food services sector, 
  • 11% in the professional services sector, and 
  • 10% in the manufacturing and transportation sectors.

Of course, the numbers in 2021 were low due to the pandemic and both travel and work restrictions. However, in the years leading up to the pandemic, the labour market outcomes of recent immigrants improved substantially. For example,  in 2021, the employment rate was 77% among recent immigrants, 81% among longer-term immigrants, and 84% among the Canadian born.

Temporary foreign workers (TFWs) and international students

The number of TFWs (work permit holders on December 31 in each year) increased seven-fold from 111,000 in 2000 to 777,000 in 2021. The share of TFWs among all workers with T4 earnings rose from 2% in 2010 to 4% in 2019. It was also particularly high in some of the lower-skilled sectors in 2019:

  • agriculture (15%);
  • accommodation and food services (10%); and
  • administrative and support, waste management and remediation services (10%). 

TFWs were also overrepresented in some higher-skilled industries, such as the professional, scientific, and technical services sector (6%); and information and cultural industries (5%).

<<Also Read: The sectors with the most job vacancies in Canada in 2022>>

Aditionally, the number of international students with T4 earnings increased from 22,000 (in 2000) to 354,000 (in 2019). The numbers were a result of both a higher number of international students and their rising labour force participation rate (from 18% to 50%).

According to the report, the increases were particularly large at the non-university postsecondary level, where the labour force participation rate rose from 7% to 58% and the number of participants rose from 3,000 to 173,000.

Canada to welcome almost 432,000 newcomers

Canada is targeting high levels of newcomers to support its population, labour force, and economic growth. This year, Canada will welcome 431,645 new immigrants in the following categories:

During an interview, the Minister of Immigration said his department is ahead of schedule, despite the pandemic and unexpected pressures. According to the Minister, this month they resettled the 200,000th permanent resident. “More than a month and a half ahead of any year on record in Canada,” he said. 

To explore immigration options in Canada in 2022, please read the following article:

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