Immigration boosts workforce, combats aging

On its own, immigration can’t offset the impact of Canada’s aging population, but it’s helping to counter that trend and to fill gaps in the workforce, according to new data from Statistics Canada.

The national statistical agency published data from the latest census (2021) that showed almost 23.0% of Canada’s population are now either landed immigrants or permanent residents — the highest share on record, representing 8.3 million people.

“Given that the population of Canada continues to age, and fertility is below the population replacement level, today immigration is the main driver of population growth,” StatsCan said.

If current trends continue, immigrants could eventually represent between 29.1% and 34.0% of the population by 2041.

Immigration is also central to economic growth and to potentially addressing labour shortages.

“With job vacancies in late 2021 hitting 80% higher than pre-pandemic levels, and the working population aging, immigration is even more critical to the labour market than ever before,” the report said, noting that immigrants accounted for 80% of labour force growth between 2016 and 2021.

At the same time, the population of immigrants has a younger age distribution than the overall population, helping to counter the aging trend, which has the proportion of workers on the verge of retirement at an all-time high.

“While immigration ultimately cannot stop the population aging process, it has a rejuvenating effect on the population in Canada overall,” StatsCan said, noting that 10.9% of recent immigrants were aged 15 to 24, and 64.2% were in “the core working age group,” aged 25 to 54.

Children under 15 years of age accounted for 17.1% of recent arrivals.

“Immigration over the near term will ease the labour force crunch in Canada,” the report said.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.