Several vital industries have seen minuscule immigration-driven employment growth
Recent data suggested that a significant number of new arrivals in Canada are increasingly working in sectors that do not necessarily fulfill the economy’s current or future needs — in turn making the housing market contributions of these new arrivals smaller, according to CIBC Capital Markets.
CIBC noted that newcomers’ participation in the labour market is making immigration an important engine of economic growth and supply.
However, while robust immigrant-driven growth has been observed in the education, finance, and
information services sectors since 2019, other vital industries like food, accommodation, and other personal services have seen “little-to-no increase in the numbers of new immigrants in the workforce, which may have contributed to higher-than-average vacancy rates in these areas,” CIBC said.
These trends have potentially catastrophic effects in a few decades or even years.
“Due to workforces that are ageing even faster than the economy-wide average, there may soon be even greater demand for workers in areas such as agriculture, real estate, wholesale trade, other personal services, and manufacturing,” CIBC warned.
The report stressed that it’s up to policy makers to ensure that this slack is eventually compensated for.
“While it would be unfair to expect newcomers into Canada to immediately know the intricacies of the real estate market and start selling houses (although over time, immigrants into Canada certainly do become involved in this sector), a greater focus on attracting people with specific skills, in trades for example, may prove beneficial,” CIBC said.
