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How lowering the number of non-permanent residents will impact Canada’s economy
April, 2024 | BY Janzen, N.
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Key Takeaway
Slower population growth could reduce price pressures in Canadian markets, especially in housing, but may heighten challenges related to the aging population.

 

This RBC economics report explores the potential impacts of reducing the number of non-permanent residents in Canada.

The federal government has announced plans to decrease the number of non-permanent residents. Annual targets have yet to be determined, but preliminary information implies that the starting goal will be to decrease their count by 20% over three years, equivalent to about 500,000 people.

Slowing the wave of non-permanent residents may give sectors time to respond to infrastructure demands (e.g., housing), but it could heighten the impact of baby boomers’ retirements. Reducing the number of non-permanent residents is projected to increase the average age of Canada’s population, which may further lower labour force participation, compounding the loss of baby boomers from the available labour force.

Currently, non-permanent residents have a higher labour market participation rate. They are an important part of the Canadian workforce, and the labour market will see ripple effects when their numbers decrease.

Tags:
Demographics
Immigration
Labour Market Impact
Canadian Study

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