Canada needs to nearly double immigration rate in the long run: RBC

While holding immigration targets is warranted for now, Canada will need to ramp up the number of newcomers it welcomes in the long run, a new RBC report says.

On Wednesday, Immigration Minister Marc Miller tabled the Immigration Levels Plan in Parliament, which said Canada will hold its target of annual newcomers steady at 500,000 people starting in 2026.

A report by RBC economist Cynthia Leach said that while the labour market will not feel the pinch in the short term, the current rate of immigration to Canada is not sufficient for long-term growth.

“Canada needs immigrants over the long term. Even the annual immigrant intake of 1.3% of the population is not sufficient to stabilize the age structure of the population, which would require about 2.1%,” the report read.

The federal government’s latest plan maintains previously set targets of welcoming 485,000 new permanent residents in 2024 and 500,000 new permanent residents in 2025. The number will stay at 500,000 in 2026 and “stabilize,” which Miller said is about “allowing time for successful integration” as well as “sustainable population growth.”

The RBC report said, though, that the current pause is “appropriate” given the current housing crisis.

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“The pause in targeted immigration levels is appropriate given housing challenges and eroding public support for higher levels of immigration. With a weakening economy, labour markets should not feel a pinch overall with the pause in the number of new permanent residents.”

The report added that Ottawa needs to be more “selective” in the immigrants it welcomes.

“Canada needs to be more strategic in selecting immigrants – and temporary residents who often become future immigrants – with the strongest long-term economic prospects, including those outside highly-educated fields.”

On Tuesday, Miller released the Strategic Immigration Review report in Ottawa, which said Canada’s immigration strategy over the next few years will be to focus on aligning immigration policy with the country’s labour needs.

It said Canada must focus on bringing “workers to Canada who can help alleviate social pressures in key areas like housing and health care, using dedicated Category-Based Selection draws in Express Entry.”

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The new targets come as a growing number of Canadians appear to feel immigration to Canada is too high, spurred by worry about the cost-of-living crisis, according to a new survey from the Environics Institute and echoing polling done for Global News earlier in the month by Ipsos.

The Environics survey suggests that 44 per cent of Canadians agree with the statement that “overall, there’s too much immigration to Canada” compared with 51 per cent who disagree.

This view of immigration marked a significant shift from the results last year, when only 27 per cent said there was too much immigration, and a record high of 69 per cent of people disagreed.

Miller said stabilizing immigration levels will allow governments to “take stock” and make sure labour shortages — particularly in construction — are addressed, along with housing and health-care needs for those new arrivals.