Canada must address rising living costs and housing affordability to attract skilled immigrants and foreign workers. Discover the top 10 strategies for improvement.
5 Key Takeaways:
- Rising Living Costs: Increasing living expenses and housing affordability are significant barriers to attracting skilled immigrants to Canada.
- Labour Market Shortages: Canada experienced over one million job vacancies last year, highlighting the critical need for effective labour market strategies.
- Onward Migration: An increasing number of immigrants are leaving Canada due to unmet expectations and difficulties finding work in their fields.
- Credential Recognition: Immigrants face substantial barriers in transferring foreign credentials, leading to underemployment and limiting their potential contributions.
- Government Action Needed: The Canadian government must reset policy frameworks to improve resettlement services, accelerate job onboarding, and reshape training and employment services to attract and retain foreign workers effectively.
A recent study examining Canada’s growing need for skilled immigrants emphasizes the urgency for revising labour market strategies.
The report highlights that Canada must retain its competitiveness and uphold its reputation as an attractive destination for workers.
Despite recent legislation banning employers from requiring Canadian experience for job applicants, more efforts are needed to open pathways to employment amidst critical labour shortages and skills mismatches.
The Importance of Skilled Immigrants in Canada
Canada’s labour market is grappling with significant shortages, costing the economy nearly $13 billion in 2022 alone.
With over one million vacant jobs last year and 59% of employers struggling to find qualified candidates, the need for skilled immigrants is more critical than ever.
Key sectors such as health care, construction, and hospitality are particularly affected, partly because employers in other countries recruit skilled Canadians.
Labour Market Challenges and Demographic Shifts
While the pandemic saw increased workforce participation among prime working-age groups, the overall labour supply has declined as many older workers opted for early retirement.
Canada’s largest demographic group, the baby boomers, is now all over the age of 60.
Most working-age Canadians fall within the upper end of the 15- to 64-year age range.
Projections indicate that in 2027, the worker-to-retiree ratio will be three to one, starkly contrasting the seven-to-one ratio seen 50 years ago.
Immigration as a Solution
The Deloitte report indicates that Canada, like many other nations, will need to rely on immigration to sustain its labour force growth in the foreseeable future.
Addressing the issue of onward migration, the report noted that more immigrants are leaving Canada—31% higher than the historical average in 2017 and 2019.
This trend suggests that Canada is not meeting immigrants’ expectations and must develop more effective labour market strategies to support this crucial segment of the economy.
Barriers to Employment for Immigrants
A significant cause of onward migration is the difficulty immigrants find work in their fields.
The time and processes required to transfer foreign credentials—often not recognized by Canadian regulatory bodies—and the stigma associated with foreign education and work experience pose substantial barriers.
Immigrants frequently must undergo credential evaluations, language proficiency testing, and recertification through costly training courses.
Consequently, many skilled immigrants cannot practice in their trained professions, limiting their ability to fill critical labour market gaps and integrate into the workforce, leading to persistent underemployment.
Impact of Rising Living Costs and Housing Affordability Crisis
Rising living costs and a housing affordability crisis exacerbate these issues, creating additional barriers for the skilled immigrants and global talent Canada needs.
In contrast, the United States attracts and retains talent through a more significant economic market, a robust startup ecosystem, educational opportunities, and favourable immigration policies for skilled workers, such as the H-1B visa and the O-1 visa for individuals with extraordinary abilities.
Government Role in Reshaping Policy Frameworks
The report warned that if potential permanent residents and citizens continue to seek opportunities elsewhere, Canada’s ability to bolster economic growth through immigration is at risk.
The government must play a crucial role in resetting policy frameworks, processes, and systems to reshape training and employment services, improve resettlement services, and accelerate job onboarding for newcomers.
Sector-Specific Impact of Immigration
Statistics Canada reports that as of May 2021, immigrants aged 25 to 54 represented more than 36% of people working in accommodation and food services, nearly 38% of those working in the transportation and warehousing sector, over 34% of those working in professional, scientific and technical services, and over 20% of those working in construction.
Increasing Demand for Temporary Foreign Workers
Aarmin Monga, an immigration consultant, citing a CBC News analysis, found that businesses’ demand for temporary foreign workers has surged across the country recently, with employers given the green light to hire more than double the people last year as they did five years ago.
According to figures published by Employment and Social Development Canada (ESDC), employers were cleared to hire 239,646 temporary foreign workers last year, up from 108,988 in 2018.
Roles and Sectors with High Demand
Across the economy, employers have turned to the program to fill roles ranging from administrative assistants (from 287 in 2018 to 3,337 in 2023) to light duty cleaners (from 201 to 3,043), to construction trade helpers and labourers (from 132 to 5,353), reported CBC.
Fast food chains and restaurants are a significant source of demand for temporary foreign workers.
After farm and greenhouse workers, the roles with the most approvals last year were cooks, food service supervisors, food counter attendants, and kitchen helpers, said Charanjit Kaur from Iconic Immigration.
Government Response to Labour Market Changes
This spring, the federal government changed course on the temporary foreign worker program, tightening the number of workers a business could hire.
The government cited changing labour markets and lower vacancies for this policy shift.
FAQs
What are the main challenges Canada faces in attracting foreign workers?
The main challenges include rising living costs, a housing affordability crisis, and difficulties in transferring foreign credentials, which often need to be recognized by Canadian regulatory bodies.
Why is the labour market in Canada experiencing significant shortages?
The labour market is experiencing shortages due to an aging population, early retirements, and increased recruitment of skilled Canadians by employers in other countries.
How does the housing affordability crisis impact the attraction of foreign workers?
The housing affordability crisis creates additional financial barriers for skilled immigrants, making settling and thriving in Canada difficult.
What steps has the Canadian government taken to address labour market shortages?
The government has introduced legislation banning employers from requiring Canadian experience for job applicants and is working on resetting policy frameworks to improve resettlement services and job onboarding for newcomers.
Why are more immigrants leaving Canada than before?
More immigrants are leaving Canada because the country needs to meet their expectations, particularly regarding employment opportunities and living conditions.
How can Canada improve its competitiveness in attracting global talent?
Canada can improve its competitiveness by addressing rising living costs, recognizing foreign credentials more efficiently, and creating a more supportive environment for skilled immigrants to integrate into the workforce.
Conclusion
Canada must urgently revise its labour market strategies to retain its competitiveness and uphold its reputation as an attractive destination for skilled immigrants.
Addressing rising living costs, improving housing affordability, and more efficiently recognizing foreign credentials are critical steps.
The government must reset policy frameworks, processes, and systems to reshape training and employment services, improve resettlement services, and accelerate job onboarding for newcomers.
By taking these actions, Canada can attract and retain the global talent it needs to bolster economic growth and sustain its labour force in the future.
