Like most everything, immigration involves tradeoffs, and immigration targets should try to strike a balance. There’s a growing consensus among economists and public policy analysts in this country that Canada overshot the mark in recent years.
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As Ottawa overhauls its temporary immigration programs, a new analysis by Bank of Nova Scotia warns that the unchecked population surge of the past two years is behind two-thirds of the “massive” decline in productivity over the same time period.
The drop stems from a combination of two factors: chronically-low business investment in Canada and the sudden explosion in population, which grew by 1.25 million last year alone.
Given weak investment levels, that’s far more than the 350,000 permanent and temporary immigrants Canada’s economy can absorb without having a negative impact on productivity, according to Scotiabank economists Rebekah Young and René Lalonde.
“There is a sweet spot when it comes to economic immigration – where everyone is better off over time – but it is narrow and Canada has strayed far off course,” they wrote.
The surge of temporary workers has helped keep a lid on what would have been even higher wage increases, she added, giving businesses even less of a reason to invest in productivity-boosting measures.
https://www.theglobeandmail.com/busi...vity-declines/
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Canada is caught in a “population trap” and needs to rein in immigration significantly to escape it, according to a Monday report from National Bank of Canada economists, part of an emerging consensus that explosive growth is exacerbating some of the country’s economic troubles.
In the report, economists Stéfane Marion and Alexandra Ducharme say “staggering” population growth is stretching the country’s capacity to absorb new arrivals. They add that the main example of this strain is in the housing market, where construction has lagged behind demand from newcomers.
The National Bank economists argue that annual population growth should not exceed 300,000 to 500,000.
That would be a dramatic reduction from current levels. Over the 12 months to Oct. 1, Canada’s population rose by 1.25 million, or 3.2 per cent, the quickest pace of growth since the late 1950s. Almost the entirety of the population increase was driven by international migration, and most of that was from temporary residents, such as students and workers.
“Canada is caught in a population trap that has historically been the preserve of emerging economies,” the report says. “We currently lack the infrastructure and capital stock in this country to adequately absorb current population growth and improve our standard of living.”
https://www.theglobeandmail.com/busi...igration-bank/
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https://www.theglobeandmail.com/busi...nadian-living/
Interpreting calls for reducing immigration levels as vilification of immigrants themselves is dumb. It’s like denouncing a proposed increase in retirement age as a malicious attack on seniors.