In late 2022, the federal government announced a massive increase in immigration targets, hoping to welcome 1.5 million newcomers between 2023 and 2025. The stated goal of this increase was to address labour shortages and alleviate the pressures of an aging population—and ultimately grow the Canadian economy.
It is true that welcoming more newcomers will help Canada bake a larger pie, but doing so is not enough to ensure everyone gets a larger slice. The reality is that increasing immigration targets alone will not improve the quality of life for all Canadians nor will it make the Canadian dream a reality for newcomers.
We need a better strategy—one that anchors market responsiveness and newcomer success as its core principles. We need a strategy that is driven not simply by increasing numbers but by increasing prosperity for all.
This paper, entitled When More Isn’t Enough: Why Canada Needs a Prosperity-Driven Approach to Immigration, explores the connection points between immigration and economic growth, distinguishes what immigration can and cannot do for Canada’s economic goals, and offers potential pathways for Canada to enable economic success and individual well-being—for newcomers and current citizens alike.
Some key highlights include:
- On its own, immigration is not a solution to broad-based labour shortages, an aging population, or Canada’s deeper economic challenges.
- Immigration and economic growth are linked, but increasing immigration targets is not enough to create broad prosperity. Other levers include parallel capital investment and prioritizing immigrants with the most highly valued skills, among others.
- Canada can do better. Key opportunities to improve our approach to immigration include rethinking the selection of economic immigrants and becoming an attractive place for newcomers by improving the standard of living and quality of life.
This paper is part of a broader exploration of Canada’s immigration strategy and is intended to provide a foundational and exploratory understanding of the role of immigration in economic success—and ultimately advocate for a better, prosperity-driven, approach. Future publications will build on this knowledge and explore other aspects of Canada’s immigration strategy, including how economic immigrants are selected, the role of the provinces, barriers to newcomer success, Alberta’s labour market needs, and more.
Between 2023 and 2025, Canada is expected to welcome 1.5 million new residents, as part of the federal government’s goal to increase immigration targets. The stated purpose of this increase is economic: newcomers will fill labour shortages to grow the economy and help support an aging population.
With the federal government’s new targets, immigration will account for all of Canada’s population growth and nearly all the workforce growth between now and 2036. That means that almost 30% of the population and 37% of the workforce will be immigrants.
While immigration will certainly help make Canada’s economy bigger, it will not necessarily or automatically make Canadians wealthier. In fact, projections show that while Canada is expected to see very tepid economic growth, it will lag in economic growth per capita. And with additional cracks in the system, urgent changes are needed to ensure immigration remains a source of strength and growth for Canada.
Explore more in our Prosperity-Driven Immigration for Canada project here.