Canada to Halt Increased Immigration Amid Housing Crisis and Inflation Woes.
Toronto: The liberal government of Canada has decided to maintain its immigration targets for the next two years but will discontinue the escalation of immigration beginning in 2026.
This decision comes as the nation grapples with soaring inflation and a housing crisis.
According to Immigration Minister Marc Miller, Canada’s immigration goals for this year are set at 465,000 new residents, increasing to 485,000 in 2024, and reaching 500,000 in 2025. These levels are intended to remain steady in 2026.
Miller explained that these immigration figures aim to strike a balance between promoting Canada’s economic and population growth while mitigating their impact on vital systems like infrastructure and housing.
Despite this adjustment, the Royal Bank of Canada emphasized the importance of immigrants for the country’s long-term prospects. The bank stated that an annual immigrant intake of 1.3% of the population is insufficient to stabilize the population’s age structure, which ideally requires immigration at a rate of approximately 2.1%.
Canada has primarily experienced population growth through immigration, contributing significantly to economic expansion in recent years. Nevertheless, some economists have pointed to immigration as a factor exacerbating the country’s housing shortage, even though immigrants also play a crucial role in industries like construction, which are grappling with labor shortages.
The Bank of Canada has noted that immigration has a dual impact on inflation, acting as both a driver and a mitigating force. In September, Canada’s inflation rate stood at 3.8%, where the influx of new consumers stimulates demand and raises prices, while immigrant participation in the workforce contributes to keeping labor costs in check.
The influx of immigrants propelled Canada’s population growth to its highest rate since 1957, ranking it among the top 20 fastest-growing nations globally, as reported by Statistics Canada. This growth helped offset the impact of aging residents, who are retiring and placing added pressure on healthcare expenditures.
The Institute for Canadian Citizenship has reported a growing trend of newcomers choosing to leave Canada in recent years, posing a challenge to a country heavily reliant on immigration for population and economic expansion.