Desjardins Economic Studies has released a report that highlights the benefits of welcoming talented immigrants to Canada. The report underlines how critical it is to keep accepting immigrants who bring significant skills to help fill labor shortages, particularly in the construction industry. However, the research also calls for a careful assessment of the obstacles that can prevent these workers from reaching their full potential, highlighting harassment and discrimination as major problems in the construction sector. Experts recommend expanding skilled migration in Canada to capitalize on the benefits outlined in the report.
Advisors recommend proactively strengthening laws that facilitate the smooth assimilation of qualified immigrants into the workforce by addressing labor shortages and creating a welcoming atmosphere. This strategy strives to reduce harassment and discrimination while simultaneously boosting the economy and fostering an atmosphere that best utilizes skilled labor in the construction industry.
In the third quarter of 2023, Statistics Canada released data showing that the population of Canada had increased to 40,528,396 people. This was a significant increase of 430,635 from the previous quarter and more than 500,000 more people than the 40 million threshold reached in June 2023.
There is a wealth of research on how Canada’s population expansion affects the affordability of housing. In addition to the current construction projects, the Canada Mortgage and Housing Corporation (CMHC) forecasts that an extra 3.5 million housing units will be required to fully serve the current and growing population.
Meanwhile, the Canadian Real Estate Association’s most recent data shows that, as of December 2023, the country’s average home price is $657,145. But in highly populated places like Toronto and Vancouver, where properties can fetch prices over a million dollars, the average hides greater values.
Individual without PR status not engaged in construction
Based on worker size, the construction industry in Canada is ranked fifteenth out of the top twenty employment industries by Desjardins. The analysis, which makes use of Census 2021 data, shows that immigrants and non-permanent residents (NPRs) make up fewer than 22% of the Canadian construction workforce.
Comparable data collected in 2019 showed that 21% of new arrivals were working in construction occupations, indicating no development since then. Furthermore, just “5% of employed NPRs (or 3% of total NPRs)” work in construction, according to a recent Bank of Canada analysis. The population group with the largest rate of growth is NPRs; however, they experience underrepresentation in construction employment.
Costs and productivity are also influential factors
The paper states that there are additional variables at work in the housing crisis in addition to growing immigration.
For example, the research highlights that the current cost of building materials is at a 10-year high, exacerbated by the elevated loan rates and supply chain disruptions resulting from the COVID-19 outbreak.
According to projections from the Canada Mortgage and Housing Corporation (CMHC), these increased expenses will cause over 40% of residential developers to reduce the scope of their upcoming projects, and more than 30% to put off starting new ones. Apart from facing expenses, the housing industry is also facing issues with low production. According to Desjardins, the industry’s productivity has either decreased or stayed the same. The research recommends a number of actions, such as the development of a library of pre-approved building plans, to address this problem and satisfy the rising demand. This proposal, which intends to expedite municipal approval procedures and enable quicker funding for housing developments, is in accordance with the endorsement of Sean Fraser, Canada’s Minister of Housing.
Enhanced strategic immigration
In the end, the Desjardins research promotes a more successful strategy for integrating immigrants into Canada’s construction industry. It draws attention to the fact that, in 2022, the Federal Skilled Trades Program (FSTP) produced a mere 455 new permanent residents; in 2023, there were no Express Entry drawings for candidates under the FSTP.
In line with this opinion, a Royal Bank of Canada (RBC) analysis highlights the need for Canada to take a more deliberate approach when choosing immigrants and temporary residents, especially those who have strong long-term economic potential, even outside of highly educated sectors.
IRCC declares its commitment to encouraging talented immigrants to contribute to industries suffering workforce issues in response to the labor shortage. For Express Entry candidates, the IRCC implemented category-based selection draws in May 2023, emphasizing candidates with in-demand human capital traits or jobs in Canada. Interestingly, one of the categories is designed especially for applicants who work in trades occupations. Nevertheless, the IRCC only held two lotteries for these applicants, while sending out 2,500 ITAs to candidates for Express Entry who had prior experience in trade occupations.
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