Diane Francis needs to rethink her position on immigration

National Post columnist and normally business friendly Diane Francis wrote a fairly sharp piece in the Financial Post criticizing the Liberals’ “unsustainable immigration plan” concluding that 400,000 per year way to many, even calling it a ‘flood’.

Francis likely knows the numbers. Between 2015 and 2019 Canada added 195,000 landed immigrants to the workforce each year, on average. Over the same period the average annual additions to the workforce from those born in Canada was only 17,000. In fact, in 2013 there were about as many born in Canada workers in the labour market as there were seven years later in 2019. Over the same period, a million landed immigrants were added to the Canadian workforce.

So there is some simple math at work here. If you are adding 200,000 immigrants to the workforce each year and if you add in non-working spouses and some children coming along with the immigrants, that gets you pretty close to 400,000/year. Of course we are also bringing in 100,000+ temporary foreign workers and a large share of the 600,000 international students also work.

Her argument is that Covid-19 has pushed up unemployment which after the dust settles (i.e. after the enhanced EI program converts to the regular EI program) we shall see how much structural unemployment is left.

Beyond Covid-19, economic growth in Canada is highly correlated to workforce/employment growth. Yes there are some productivity gains (i.e. GDP growth rises faster than workforce growth over time) but there is no denying the economy is heavily dependent on workers and if the workforce tightens too much it constrains economic growth.

Maybe Francis wants to see if Canada can grow at 2% or more per year without growth in the size of the workforce. Maybe she thinks employers will respond by deploying new labour saving technology.

I don’t want to take that risk. We did take a step back with immigration during the pandemic. According to Statistics Canada, only 284,000 immigrants were added to the population in 2019-2020 and the number of non-permanent residents was cut by more than half.

Here’s my concern. Let’s say Francis gets her way and the national immigration numbers are dropped to 300,000.

The Ontario government recently released its population growth forecasts through 2046. They are expecting 187,000 immigrants next year (reference case) or 224,000 in the high growth case.

Let’s do a little more math. Ontario is home to 39% of Canada’s population. And they want at least 187,000 immigrants per year or 224,000.

Guess which province (s) will end up with the short end of the stick if Francis’ gets her way?

The following table shows a population-based distribution of immigrants. If Ontario wants at least 187,000 (or even 224,000) and let’s assume BC, etc. want a similar level, what’s left over for the Atl. Provinces? Newfoundland and Labrador just announced they want 5,100 by 2026. New Brunswick wants 8,000 (I think we need a minimum of 10,000). PEI is already at an immigration level commensurate with 500,000 across the country.

So the question for Francis is simple. Who loses in her model?