Is Canada’s Retirement Plan Safe?

Immigration and a Shrinking Workforce
Media everywhere are hailing immigration as the solution to our aging population. Immigrants will not only fill the worker shortage, but they pay taxes and help the fertility rate by having children. Canada’s population saw a growth by 324,000 persons to some 32.6 million from July of 2005 to July of 2006. Of this increase, approximately two thirds of it can be contributed to immigration into Canada, for the most part in the form of skilled workers.

The general opinion of Canadians towards immigration tends to be positive, with as many as four out of five Canadians supporting immigration and believing it to be beneficial for the country. Yet, there are also criticisms of the current system, as it is said to allow immigrants with qualifications that do not match Canadian standards into the country as well. Others cite the backlogging of the system of over 800,000 applications and the resulting shortage of work for immigrants as the main flaws.

However, the same survey also mentions that while Canadians support immigration, there is little enthusiasm for increasing the number of immigrants into the country. It is not necessarily that Canadians want only a set number of immigrants coming into the country, but more of a desire to balance the influx of newcomers with the jobs available.

And therein lays the problem: to be able to match the amount of skilled immigrant workers coming into the country with the job vacancies available is impossible. Not only is the labour market constantly changing, but the process of applying and actually being able to immigrate to Canada takes anywhere from an estimated three to four years at times.

Overall, immigration has been a very strong force propelling Canada’s somewhat stagnant population growth. It has only been recently that Statistics Canada has identified a stabilization of Canada’s natural rate of population growth—excess births over deaths—at 3.3 per 1000, which has been attributed strongly to new immigrants. The data also gives credit to immigration for 60% of the population growth in Canada over the last decade, which has increased from 46.2% a decade earlier.

This seems to be strong evidence that although the points-based aspect of Canada’s immigration system should be maintained, and perhaps even improved, it is imperative to develop a much more efficient application-approving process.