The Canadian unemployment rate of 5.1 percent implies drastic labor shortages. Job vacancies have risen by 80 percent compared to the pre-pandemic time.
The aging population has led to a tremendous number of job vacancies as every 1 out of 5 people has reached their retirement stage. Only 1.4 children are being born to a woman. A reduced birth rate is also one of the reasons for the vacant jobs.
The birth rate stated above is insufficient to replace those people reaching the retiring age.
Immigration is the solution
As per official reports of Statistics Canada, those immigrants who recently immigrated to Canada (they’ve been in Canada for 10 years or lesser) contribute to 8 percent of the entire labor force employed in Canada. At the same time, the food and hospitality sector contributes 13 percent of them. On the other hand, 11 percent contribute to the professional services sector and 10 percent to the transportation and manufacturing sectors.
As per research, it is observed that job vacancies are trending upwards in the manufacturing and retail trade sectors. Vacancies associated with the manufacturing industry rose to 87,400 in the last quarter. Vacancies for the retail trade employees peaked at 114,600.
Work permit holders are increasingly converting to permanent residency
The last decade saw an unpredictable growth in Canadian work permit holders from 111,000 to 770,000. These workers are often associated with the low-skilled categories such as the accommodation and food sector, agriculture, administrative and support, etc.
In 2020, it was noted that around 67 percent of the new immigrant population was previously categorized as work permit holders or international students.
It is noteworthy that international students are increasingly becoming permanent residents within just 10 years of their arrival in Canada. Their first step is usually to attain a Post-Graduate Work Permit (PGWP) post completion of their studies.
Immigrants facing labor market challenges
As per research, it has also been found that those individuals holding a work permit or even permanent residency status experience a sort of challenge with the inability of employers to utilize their skills to the best. Their skills remain under-utilized due to the complex accreditation process in Canada that the immigrants fail to achieve.
Immigrants from educated universities, working at positions where their degrees are required, have reduced in number. The percentage of the above category has decreased from 46 % to 38 % from 2001 to 2016. If this decrease in percentage continues, there will be an increase in the shortage in high employment sectors.
Conclusion
As far as the long-term strategy is concerned, Canada will need to keep up with an increased flow of skilled labor to balance the impact of Canada’s aging population on the labor market.
Canada brings forth hundred immigration pathways as it understands the significance of immigrants in the economy.
Express Entry is one of the most prominent streams under the federal government. Even though its streams have paused for a long, the immigration minister, Mr. Fraser has assured us that the draws will resume on July 6.
