Canada job market is increasingly being squeezed as this land of opportunity stands at a new test. Whereas immigration has over a long period been fundamental in building on the labor force of Canada, recent trends have shown businesses just are not hiring fast enough to accommodate the rapidly expanding workforce. This increasing gap between population growth and the availability of jobs makes life very tough for the newcomers, especially international students and temporary workers, trying to find jobs in this competitive environment.
Large Population Growth, Limited Job Creation
Canada’s workforce-aged population, meanwhile, rose 96,400 in August 2024, but the country added a paltry 22,100 net new jobs. The disconnect speaks to an increasingly dire problem: Canada’s job market simply isn’t growing fast enough to absorb new entrants. Indeed, over the past three months, for every six new workers entering the workforce, only one job was added, which also constitutes the slowest rate of job growth in more than a year.
While immigration and the increase of foreign students bolster the population tremendously, Canada’s population grew by 3.2% alone in the past year, marking the second consecutive year that the country added more than a million people. That, however, does not mean that all find jobs as the workforce grows. Indeed reports that job postings are down a massive 23 percent compared to last year, while businesses go slow on hiring. This is considered to be partly cooling the job market in Canada.
New Immigrants Find It Difficult to Get Employed
But it is also adding to the pressure on an already scrambling economy. Most of the new immigrants, especially the ones who came in the last five years, do not find jobs easily. About 12.3 percent of recent immigrants remain unemployed, which is more than twice as many as Canadian-born workers and immigrants who arrived more than a decade ago.
Of course, many of these new arrivals are students and thus are not seeking employment. Of the 1.1 million that entered the workforce in the past year, only half were seeking a job. Slightly more than half of those who did look for employment found a job. This compares to pre-pandemic years when two-thirds of the working-age population was seeking work, and virtually all found jobs.
Immigration Overshoot and its Consequences
While immigration was generally considered one way out of the demographic squeeze Canada has gone through because of its ageing population and labour shortages, there is a growing belief that it may have vershot.” With all the mass immigrations into Canada, infrastructures like housing and job markets are under high stress. Derek Holt, an economist at Bank of Nova Scotia, said that rapid immigration could have political and economic implications that reverberate well past the election cycle.
“Canada took on too much immigration too fast, outpacing the capacity of the job market and infrastructure to keep pace,” Holt said in a recent report. That mismanagement could create public disgruntlement and make immigration an increasingly divisive political issue, especially as the country grapples with an escalating housing crisis.
Responding to the Problem
As the immigration challenge continues to unfold in Canada, the need for policymakers is to take quick and concrete actions that better balance demographic growth with work opportunities. It will be necessary to adjust immigration quotas, invest in infrastructure development, and incentivise businesses to hire more labour to keep on making Canada a feasible destination for those seeking economic stability.
In the long run, providing avenues for international students and temporary workers to find permanent employment will be decisive for Canada’s prosperity. While it is doubtful that the Canadian labour market will slow down anytime soon, the demand for skilled labour is still in demand, and with the proper policies, it can once again become a land of opportunity for its newest residents.
Conclusion
While the population in Canada has been continuously growing, job creation cannot keep up with it, and that makes many newcomers suffer due to finding jobs. Whereas immigration has been one of the major affecting factors in economic growth, if the rate of influx is greater than the country’s job market and infrastructure can accommodate, it can result in a burden. Any correction to these challenges in immigration requires serious planning and policy adjustments to be able to accommodate the new settlers’ contribution and benefit from the country’s economy.
