When times get tough, governments tend to point the finger at immigrants. Yet in Canada, new policies that encourage immigration are proving invaluable to the country’s labour market.
According to a recent OECD study, 50 percent of Europeans think immigrants contribute less in taxes than they receive in healthcare and welfare, thus draining the state of money and resources. If that’s the case, Canadians have reason to be afraid: one in five residents there was born in a different country.
Oddly enough, the country’s economy hasn’t imploded: in fact, high immigration has helped Canada bounce back from the global financial crisis by improving the quality of its workforce. The secret to this success lies in clear-cut governmental policies that encourage immigration rather than hinder it.
As the country’s population begins to grey, the Canadian government is placing more emphasis than ever on human capital and building its labour force with highly skilled and talented individuals. So long as they don’t mind looking abroad, they’ve got plenty of individuals to choose from: the OECD estimates that, over the last 20 years, immigration demographics have shifted from being dominated by low-skilled workers to a majority that’s highly skilled and educated. In order to attract these individuals, the Canadian government has spent the last 12 years devising a number of programmes to draw them in.
In 2001, lawmakers passed the Immigration and Refugee Protection Act, a comprehensive plan of attack that created four major initiatives attracting and integrating foreigners into Canadian society: the Federal Skilled Worker Programme (FSWP); the Temporary Worker Programme; Arranged Employment Opinion; and the Provincial Nominee Programme. The FSWP is the biggest of these programmes and encourages the best and brightest to move to Canada. It is now responsible for 81 percent of all foreign admissions.
More recent policy changes have been even more effective. A new branch of the FSWP programme launched earlier this year has already led to an influx of skilled workers joining new and innovative start-ups. Meanwhile, the government hasn’t neglected migrants from the other end of the spectrum. Although the government most actively pursues educated immigrants, it also continues to be one of the OECD’s top destinations for asylum seekers. 2012’s Protecting Canada’s Immigration System Act and subsequent bills have ensured the country’s 230,000-plus asylum seekers and low-skilled workers are better integrated into society.
This influx of foreigners has proven wrong the presumption that immigration wreaks havoc on a country’s fiscal situation – a myth that was further debunked this summer when the OECD released their International Migration Outlook 2013 report. The study concluded that not only do low-skilled workers have no negative impact on a country’s economy, but also the average skilled immigrant is actually a higher net fiscal contributor to a given economy than most natural-born citizens.
The employment figures of immigrant-high Canada validate this assertion. For example, while 75.1 percent of natural born Canadian men are gainfully employed, 75 percent of foreign-born men are employed. Because a vast proportion of low-skilled workers arrive to Canada without work, the country’s unemployment rate amongst immigrants is 0.6 percent higher. However, this skewed data has had no visible affect on the country’s GDP per capita. What’s more, Canada’s latest influx of skilled immigrants has driven unemployment down 0.5 percent.
Over the last 50 years, the OECD has reported that cumulative immigration failed to considerably impact any given economy – positively or negatively. Yet by drafting policies that attract immigrants rather than hinder them, Canada has been able to sustain growth in its labour market and avoid problems plaguing many European nations such as talent exodus and ageing workforces.
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