By 2030, all 9.2 million of Canada’s baby boomers will reach retirement age. This briefing explores various solutions to help strengthen our labour force and economy.
We have all heard the question: Why does Canada welcome all these immigrants when so many Canadians are unemployed?
The study forecasts that 12 million Canadians will complete their education and enter the workforce between now and 2040, but this will not be enough to fully replenish the more than 13 million Canadians that will exit the workforce over this period, predominantly due to retirement.
Given its domestic population will not be enough to sustain the size of its labour force (which is key to sustaining economic growth), Canada needs to find alternative solutions to meet its workforce needs. Immigration is one solution, but we would be remiss not to explore other options. These include lifting the participation rates of under-represented talent pools, promoting a higher birth rate, and technological advances.
Immigration will be the number one solution to address Canada’s labour force needs as it will add over 5 million new workers between now and 2040. It will account for 100% of Canada’s labour force growth over this period. (12 million Canadian students – 13 million Canadians exiting the labour market + 5 million immigrants = Almost 4 million net new workers thanks to immigration).
In other words, immigration will be the difference between Canada having 18 million workers in 2040 (Canada has about 20 million workers today) versus over 23 million workers to drive economic activity and pay taxes.
Immigration, however, is not a zero-sum game. The combination of welcoming newcomers, lifting the participation rates of under-represented talent such as women, Indigenous peoples, and persons with disabilities, and leveraging technological advances is Canada’s best path forward. Among all of the options we consider in our new study, this one would yield the strongest labour force and economic growth, and robust per capita income growth.
So, the next time someone asks you why we are welcoming all these immigrants, you can politely communicate that we should absolutely tap into people that are unemployed and underemployed, but at the same time, it is in our nation’s economic interests to complement Canadian talent with newcomers.
Source: Conference Board of Canada