Canada’s 2023-2025 Immigration Levels Plan: Tackling Labour Shortages to Grow the Economy

Nov 7, 2022 | Front Page, Policy, Workforce

Written by: Elisabeth Saftiuk, VP, Policy & Government Relations 

Last week, the Honourable Sean Fraser, Minister of Immigration, Refugees and Citizenship, released Canada’s 2023-2025 Immigration Levels Plan, signaling to Canadians that the Government of Canada intends to address unprecedented talent shortages and workforce challenges in this country with ambitious immigration targets and a focus on economic growth.

In 2021, Canada welcomed the most immigrants in a single year in its history, with nearly 406,000 permanent residents in the economic, family reunification, and refugee/humanitarian streams. By contrast, the 2023-2025 Levels Plan sets aggressive targets of 465,000 permanent residents in 2023, 485,000 in 2024, and 500,000 in 2025. The plan also places greater emphasis on the economic immigration stream by setting a goal for 60% of all admissions to come from that stream by 2025.

Canada is facing critical labour market shortages and it is causing uncertainty for Canadian businesses and workers. The Minister suggests these ambitious immigration targets are necessary to ensure Canada’s economic prosperity as the country struggles with a labour shortage resulting in 1 million job vacancies. In response to the talent shortage, Canada’s 2023-2025 levels plan embraces immigration as a strategy to help businesses find workers and to attract the skills required in key sectors, including in health care, skilled trades, manufacturing and technology.

Canada’s 9.6 million baby boomers are getting older and are transitioning from the labour force into retirement. Since Canada has a low birth rate, the nation is relying on immigration to drive much of its labour force growth. Ambitious immigration targets will be an important component of managing the social and economic challenges ahead for Canada.

According to the Government of Canada, immigration accounts for almost 100% of Canada’s labour force growth, and, by 2032, it is projected to account for 100% of Canada’s population growth. Canada’s aging population means that the worker-to-retiree ratio is expected to shift from seven-to-one 50 years ago to two-to-one by 2035.

In Manitoba, business leaders are experiencing talent shortages and workforce challenges not seen in years. Prior to the pandemic, Manitoba employers were reporting difficulty recruiting and retaining employees with the right mix of skills and talent necessary to grow their businesses. The pandemic made these challenges even more acute provincewide.

Manitoba Chambers of Commerce members have identified employee recruitment and retention as their single greatest challenge this year. Practically, this has meant that without the requisite staff to fill regular shifts, many businesses have reduced operating hours or remain open for fewer days each week.

The Manitoba Chambers of Commerce welcomes the ambitious immigration targets presented in Canada’s new plan, as increased economic immigration into Manitoba has been a strategy for which we have long been advocating. However, immigration alone will not resolve the economic challenges currently facing Manitoba. Population retention is critical, and our annual interprovincial net migration rates are unsettling.

According to Statistics Canada, Manitoba experienced a net loss of 10,203 residents to other provinces and territories in the 2021/22 Fiscal Year. Our most significant losses were to Ontario, Alberta, and British Columbia, however, we also lost 1,690 residents to Saskatchewan. In comparison, Manitoba’s net population loss in 2017/18 was 7,148 and ten years prior, it was 4,212. Manitoba has a growing retention problem.

In today’s globally competitive environment, government must create a climate that attracts new residents, that is conducive to new investment, and it must retain its existing population. When we look at the nationwide economic competition landscape, other provinces are outplaying us. Let’s consider recent post-secondary graduates assessing their futures: They look at where they can get a job, where they can keep more of the money they earn, and where their quality of life will be best. Young people are doing their research.

With a highly mobile workforce and labour shortages across the country, competitive personal income tax rates are essential. Manitoba’s taxation structure is very much linked to our ability to compete for talent. Businesses make decisions in the same way. They are not restricted by borders, and they will go where they can be most successful. A friendlier tax framework is absolutely a part of their decision-making.

Beyond taxation, investments in education and training, with a focus on working with businesses to attract workers from around the world to fill labour gaps is key. Better alignment between industry and post-secondary through a talent and skills development strategy that aligns with our economic goals will enable Manitoba’s success into the future.

While we need to see leadership from our government on core economic issues, the most effective solutions will best be reached in collaboration with post-secondary institutions, industry partners, and Manitoba’s business community.

Download the report as a PDF.

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