Business associations welcome Ottawa’s increased immigration plan but want even higher levels

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Ottawa's new immigration plan will increase the number of immigrants admitted based on their work skills or experience. PHOTO by Pexels.

The federal government wants to boost the number of immigrants entering Canada to 500,000 by 2025 to address the pressing labour shortage faced by Canadian businesses.

This marks a sizeable increase from the 405,000 immigrants who entered Canada in 2021, the 431,000 who will do so this year, and the 465,000 expected to be accepted for next year. Immigration Minister Sean Fraser in revealing the new target said the move is necessary to ensure Canada’s economic prosperity. The significant labour shortage Canada faces has about one million job vacant across the country.

The new plan puts an emphasis on increasing the number of immigrants who will be admitted based on their work skills or experience over the next three years. From 2016 to 2021, immigrants accounted for four-fifths of Canada’s labour force growth, according to Statistics Canada. More than half of recent immigrants — 748,120 of the 1.3 million admitted to Canada between 2016 and 2021 — entered Canada under the economic category.

Canadian Manufacturers & Exporters welcomed the announcement of increased immigration levels but believes that the plan’s objectives are still insufficient to meet the country’s significant workforce needs, particularly in the manufacturing sector.

“CME has been calling for an increase of immigration levels. While the government’s plan sets us on a positive trajectory, our sector still requires more economic-class immigrants,” said Dennis Darby, CME President and CEO. “Manufacturers are increasingly using immigration to supplement their workforce, but there are not enough immigrants to meet the demand.”

CME’s 2022 Labour and Skills Survey collected data from 563 manufacturers across the country and revealed that, in the last year alone, the deepening labour and skills shortages have resulted in economic losses totalling nearly $13 billion. Additionally, these shortages also constrain future growth prospects, as 15% of manufacturers are considering moving some or all their production outside of Canada, citing a lack of workers.

“Labour and skills shortages are a chronic and persistent issue for manufacturers, and they continue to limit the growth of the industry. Labor shortages have cost over $13 billion to manufacturers last year. We need more immigration to grow our sector,” added Darby.

CME is asking the federal government to increase the intake of economic-class immigrants alone to 500,000 per year by 2025, to address application backlogs, to speed up the Temporary Foreign Worker Program by adopting a trusted employer system and streamlining the Labour Market Impact Assessment (LMIA) application.

The Business Council of Canada (BCC) also welcomed the immigration increase but said it wants to see the number of immigrants admitted under the economic category increase from just over half to 65 per cent of the total.

“In a recent survey of the country’s leading employers, 80% reported having difficulty finding the skilled workers they need to grow and compete globally. As a result of these shortages, 67% had canceled or delayed major projects. Some 30% were forced to relocate work outside of Canada. With an aging workforce and a declining labour participation rate, Canada’s future prosperity depends on further increases to the annual number of economic-class applicants who are granted permanent resident status,” said Goldy Hyer, president and CEO of the BCC. “For that reason, we are proposing that the 2023-2025 immigration levels plan adopt an annual admission target equal to 1.2% of Canada’s population, with 65% of new permanent residents entering the country under an economic class program. In support of this goal, we recommend that the Fall Economic Statement provide additional funding to rapidly modernize immigration IT systems, open new processing centres, and increase the ranks of border agents and settlement services personnel.”

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