Desai: Canada can’t afford a long immigration pause. We must reorient the system now

Part of the issue is that many Canadian businesses are addicted to lower cost lower skilled workers, whether temporary or permanent:

For generations, Canada’s approach to welcoming migrants had a strong consensus across partisan, sectoral and geographic lines. It was the result of immigration fuelling our economy and is still a distinct feature of a uniquely Canadian identity; a tangible expression of our compassion.

This consensus has been broken as a result of the system being manipulated for political ends and short-term economic arbitrage. If Canada is to achieve its full potential, we will not only need to reform our immigration system to flourish under our current circumstances, but we also must rebuild the broad immigration consensus.

Canada’s approach to immigration is often presented as disparate pillars. The most prominent is the economic stream, which allows migrants to apply based on our broad labour-market needs. They are supplemented with international students and temporary foreign workers.

The family reunification class aims to allow a settled resident to sponsor their loved ones. Our refugee class was originally set up to support the world’s most vulnerable.

What made Canada’s system successful is the mutually reinforcing nature of each pillar. Fundamental to the success of a migrant is their ability to contribute economically and socially.

The Environics Institute has been gauging Canadians’ support for immigration since 1977. From 2000 to 2020, more than half of those polled disagreed that “overall there is too much immigration to Canada.” This isn’t to say there weren’t issues with our system, but those problems paled in comparison to the systemic rot that resulted in 58 per cent of Canadians believing we accept too many immigrants in 2024.

Labour-market demand information often lags or doesn’t align with the specific needs of, or accreditations required by, employers. The temporary foreign workers program has been used to reduce employers’ cost bases at the expense of domestic employees or investing in productivity-generating technologies.

International students have been used as a cash cow for postsecondary institutions, including many institutions with dubious credentials. The generosity of our refugee system has also been taken advantage of by those with the means to reach Canada’s borders. This ties up scarce resources to resettle those most in need around the world.

These issues are contributing to some of our greatest challenges: our housing and food-bank shortages, and slumping productivity, are the most prominent.

Amidst this rotting foundation, our federal government was virtue signalling and trying to out-manoeuvre their political opponents; they offered a blanket welcome mat to any would-be immigrant the U.S. turned away under the last Trump administration. They made a top-down commitment to welcome 1.5 million immigrants over a period of three years without a clear plan for how we would absorb this volume of newcomers.

While the government has issued a mea culpa, it alone will not suffice. Reducing targets and cracking down on those who manipulate our system with harsh penalties is a start, but alone these measures will not contribute to addressing our broader economic woes.

On top of Canada’s immigration challenges, we’re also facing a bleak demographic reality: by 2035, Canada’s worker-to-retiree ratio will be 2:1. For reference, it was 7:1 in 1971. This is coupled with our stark productivity lag, which immigration helped mask for decades.

The hope that Canadians will become more productive overnight, or that the world’s top talent will simply come to the conclusion that they should call Canada home, is wishful thinking.

Canada is going to require a radical reform of our immigration policy, one which reorients all stakeholders to an aggressive, co-recruitment model of the top talent we require. We will have to invest in real-time, labour-demand data to inform our recruitment strategy, so that we actually address our economic needs while balancing considerations like housing availability.

The government has some experience with an employer-driven approach to immigration. It created the Global Skills Strategy that allowed employers to fast-track work-permit processing to two weeks.

Our consensus on immigration will have to be rebuilt over time by demonstrating its contribution to addressing our economic woes. The government’s strategy of top-down targets must be shed and replaced with a structural focus on recruitment based on demand. Our immigration officials will have to act less like passive application processors and more like head hunters for the entrepreneurs, health care professionals, engineers and other talented individuals required to fuel Canada’s economy and vibrant society for generations to come.

Neil Desai is an executive in the tech sector and serves as a senior fellow with the Centre for International Governance Innovation. He previously served in senior roles with the government of Canada.

Source: Canada can’t afford a long immigration pause. We must reorient the system now