The Conference Board of Canada has in a new report found that immigration levels should increase by 413,000 per year by the year 2030 to strengthen the economic growth. The report emphasizes the need to increase immigration in order to combat the challenges brought by Canada’s aging population. It is believed that without improved policy changes, including a significant increase in immigration, the costs required to sustain retirees could reduce the strength of the Canadian economy in the next few decades.
The report proposed four scenarios for the future of Canada’s population growth. Immigration is a significant factor for the future of the country, and improving the fertility rate, which currently stands at 1.6 births per woman as of 2015 is not enough to sustain economic growth.
The report stated a more optimistic scenario that predicts that Canada will be able to attract 413,000 immigrants per year by 2030 which will improve economic growth. This scenario predicts that Canada’s population will increase by 100 million by the year 2100.The increase in economic growth will mean greater revenue for provincial and federal governments. The number of home owners will also result in increased spending on consumer goods.
The report also projects another scenario where immigration grows gradually, but shifts to a younger demographic of new arrivals, the impact on Canada’s economy and fertility rates could be significant. The report’s understanding is that if more men and women come to start careers and families in Canada, the country will be able to benefit from their economic input and the input of their children on future generations.
More Working Age Immigrants needed
The report acknowledges that even though immigration alone cannot solve Canada’s aging population problem, new immigrants are still important to reduce the side effects it may cause. With Canada’s population aging, it creates pressure to social welfare systems to support the elderly. Meanwhile, more jobs will become available as the older generation retires and young people and their families will be needed to take up the positions.
An increase in the Canadian population will help ‘cushion the impact’ of economic consequences of the advanced aging population, the report also adds that inviting more immigrants to enter the workforce will elevate Canada’s labor force and enhance long-term economic growth. Economic growth will be improved in the long-term by inviting qualified and experienced working age individuals as opposed to focusing on increasing the fertility rate of the population. It provides a quicker and efficient resolution to the issue of dwindling pool of workers. It will also reduce the pressure on social services caused by an increase in retirees.
The report argues that if the population growth is left at the current rate without significant help to improve it, the country will have a population of 54 million Canadians by the year 2100, and this the report deems to be insufficient to support a growing economy and aging population. The slowed growth in population will eventually have a negative effect on the government’s revenue, social services, and job creation.
The report concludes that the ‘growing Canada’ population through immigration will aid the economy and will soften the blow to an increasingly aging population and low birth rates’.
The 413,000 new immigrants per year by 2030 that is proposed in the report is the most optimistic scenario of the report and is by no means impossible to achieve. A previous report found that in the period between July 2015 to July 2016, Canada experienced the highest levels of immigration since 1971, when records begun. New immigrants totaling 320,932 arrived in Canada during this period, representing an increase of over one-third recorded over the same period in 2014-2015.