Canada’s Economy Could Be Hurt By Downturn In Temporary Residents

Canada Takes ‘Step In Right Direction’ By Maintaining Immigration Levels
Canada immigration free assessment

A study conducted by an economist at Desjardins says Canada needs to brace itself for the economic fallout of a possible drop in the number of temporary residents, including temporary foreign workers and international students, it receives every year.

In Temporary Workers, Temporary Growth? How a Slowdown in the Recent Migration Surge Could Exacerbate Canada’s Downturn, Desjardins principal economist Marc Desormeaux warns that the record numbers of temporary residents could soon ease off.

Since temporary residents are the primary drivers of population growth in Canada, a significant drop in their numbers could lead to a stalling of the Canadian economy.

“History suggests the recent surge (in the number of temporary residents in Canada) could ease significantly, exacerbating a nascent economic slowdown,” cautions Desormeaux.

“That could have significant consequences nationwide, most notably in the largest provinces.”

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British Columbia and Ontario’s most recent fiscal plans include contingencies for that possible scenario in an attempt to create buffers to the accompanying downturn in tax revenues to provincial coffers and a more sluggish economy should there be a drop in temporary residents.

“We must nonetheless consider downside demographic scenarios, particularly when potentially higherforlonger interest rates pose risks for economic growth, borrowing costs and debt sustainability over time,” notes Desormeaux.

In British Columbia and Ontario, he predicts a downturn in temporary residents could create a 0.8 to 1.9 percentage point drag on economic growth next year.

He recommends Canada beef up its data collection on the numbers of temporary residents in the country.

“We also reiterate our call for more and better data on temporary migration. For the foreseeable future, Canada and all its provinces will continue to grapple with the immense challenges of a rapidly aging population and a lack of affordable housing supply. To meet these challenges, we’ll need clear information about the individuals who can help address them.”

StatsCan Starting To Count Temporary Residents More Carefully

Statistics Canada seems to agree.

This month, it started publishing new data tables estimating the number of temporary residents in the country after an economic report claimed the statistical and demographic services agency may be undercounting them by more than a million.

The revised methodology StatsCan is set to follow was implemented Sept. 27 and will go back to 2021 to estimate the population of temporary residents.

The latest data from Immigration, Refugees and Citizenship Canada (IRCC) reveals Canada issued 458,915 work permits under the International Mobility Program (IMP) last year and another 692,550 such permits in the first eight months of this year.


The IRCC also issued 135,565 work permits under the Temporary Foreign Worker Program (TFWP) last year and another 142,150 in the first eight months of this year.

Last year, Canadian immigration also issued 548,955 study permits and followed that up by issuing another 463,910 to international students in the first eight months of this year.

The Desjardins study comes ahead of an anticipated increase in Canada’s target levels of permanent immigration on Wednesday.

Canada Expected To Announce Boost In Permanent Immigration Targets This Week

Immigration Minister Marc Miller is expected to further raise Canada’s immigration targets on Wednesday to boost the economy rather than give way to a growing sentiment that immigration is too high and fueling inflation.

Under its current 2023-2025 Immigration Levels Plan, Ottawa has set its immigration target for 2023 at 465,000 new permanent residents. The country is also to welcome 485,000 new permanent residents in 2024 and another 500,000 in 2025.

That’s a total of 1.45 million immigrants that Canada’s current immigration levels plan intends to welcome into the country during those three years.

The latest IRCC figures show Canada is already on track to welcome far more than its planned number of immigrants this year.

During the first eight months of this year, Canada saw the arrival of 338,905 new permanent residents, putting the country on track to welcome 508,357 new permanent residents by the end of this year provided the level of immigration so far continues through to the end of 2023.

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Colin Singer
Colin Singer is an international acclaimed Canadian immigration lawyer and founder of featured on Wikipedia. Colin Singer is also founding director of the Canadian Citizenship & Immigration Resource Center (CCIRC) Inc. He served as an Associate Editor of ‘Immigration Law Reporter’, the pre-eminent immigration law publication in Canada. He previously served as an executive member of the Canadian Bar Association’s Quebec and National Immigration Law Sections and is currently a member of the Canadian Chapter of the American Immigration Lawyers Association. Colin has twice appeared as an expert witness before Canada’s House of Commons Standing Committee on Citizenship and Immigration. He is frequently recognized as a recommended authority at national conferences sponsored by government and non-government organizations on matters affecting Canada’s immigration and human resource industries. Since 2009, Colin has been a Governor of the Quebec Bar Foundation a non-profit organization committed to the advancement of the profession, and became a lifetime member in 2018.