Canada increasingly dependent on low-wage migrant workers, says report

Confirmation what many have been noting (chart below highlights shift before more recent reversal_:

The share of native-born Canadians in the labour force has dropped nearly 10 percentage points since 2006, according to a new Bank of Canada report documenting how the country’s economy is becoming increasingly reliant on low-wage migrant workers.

“Not only has Canada experienced an unprecedented surge in immigration, but the composition of recent newcomers has been markedly different than in the past,” reads a discussion paper published May 9 by the bank’s Economic Analysis Department.

The paper found that, driven largely by a surge in temporary migration, the average Canadian immigrant has now become younger, lower-skilled and more likely to hail from poorer regions such as India, sub-Saharan Africa or the Middle East.

They’re also paid less. Particularly among Canada’s surging ranks of temporary migrant workers, wages have “reduced significantly relative to Canadian-born workers,” reads the paper.

Since 2015, “the average nominal wage gap between temporary and Canadian-born workers has more than doubled,” it read.

The authors calculated that the average migrant worker in Canada is now paid more than one fifth (22.6 per cent) less than a comparable Canadian-born worker. Prior to 2014, that gap was only 9.5 per cent.

The paper, entitled The Shift in Canadian Immigration Composition and its Effect on Wages, is one of the most definitive official documents as to the massive surge of migrant workers brought to Canada in the immediate wake of the COVID-19 pandemic.

Starting in 2022, Canada began accepting more than one million newcomers per year, mostly in “non-permanent” categories of immigrants ranging from international students, who are among those admitted under the international mobility program, to temporary foreign workers.

The Bank of Canada document shows that this wasn’t just unprecedented for Canada, but it went well beyond the pale of any comparable advanced economy.

Between 2019 and 2023, Canada charted population growth of more than six per cent. This was triple the rate seen in the United States, and double the rate seen in Switzerland, the only other developed economy analyzed by the paper whose demographic shift came anywhere close to those of Canada’s….

Source: Canada increasingly dependent on low-wage migrant workers, says report