According to a Report, Most of the Growth in Ontario’s Labor Force is Due to Immigrants

Ontario’s labor force growth is driven mostly by immigrants to the province, as per the Financial Accountability Office of Ontario’s (FAO) report on long-term international immigrant trends.

The definition of “immigrant” for the purpose of this analysis (titled Labor Market Outcomes of Immigrants in Ontario and its Major Cities) is restricted to permanent residents (economic immigrants, family sponsorship immigrants, refugees, or other immigrants), and does not extend to interprovincial migrants and non-permanent residents such as temporary foreign workers and international students.

Moreover, the report in question is based on data from Statistics Canada’s 2021 Census, Demographic Estimates, Labor Force Survey, and Longitudinal Immigration Database.

With immigration reaching 227,424 in 2022 and set to remain high in the near term, the employment outcomes for new PRs were claimed by the report to play a “significant role” in Ontario’s economic growth.

Labor Force Characteristics of Immigrants Coming to Ontario

Ontario’s labor force growth is increasing because of immigrants

FAO found that immigration to Ontario is reliant on Ottawa’s federally-set annual immigration levels, policy changes in admission programs, and Ontario’s economic performance in relation to other regions of Canada.

Although their numbers declined in 2020 and 2021 because of COVID-19’s grip on the international movement of workers, Ontario welcomed 227,424 newcomers in 2022. This was a reflection of eased border restrictions, efforts to lessen the immigration backlogs, and bolstered immigration targets introduced by the federal government.

The province’s share of immigrants to Canada had also declined over the years (going from a peak of 59.6 percent in 2002 to 36.1 percent in 2017) but has since bounced back to 42.5 percent this year.

Despite the aforementioned fluctuations, immigrants are contributing increasingly to the growth of the province’s labor force. From 2007 to 2014, they made up 39 percent of Ontario’s growth in that regard, while from 2015 to 2022, they made up 63 percent of the labor force increase in the province.

The composition of international immigration in Ontario has shifted towards “core working-age immigrants”

The age composition of international immigrants settling in Ontario every year has changed significantly over the last four decades.

The share of working-age individuals out of all landed immigrants, for one, has gone up from 43.7 percent in the 1980s to 62.3 percent in 2016-2022. On the other hand, the share of the older working age groups went down from 6.6 percent in the 1980s to 4.0 percent in 2016-2022.

Currently, the age composition of the recent immigrant group in Canada is significantly younger than that of the total Ontario population.

“As Ontario’s population continues to age,” wrote the report, “immigration is expected to only partially offset the projected decline in the province’s working-age population.”

A growing share of recent newcomers to Canada are university-educated and possess Canadian pre-admission work and/or study experience

Of the “core working age immigrants” who came to Canada between 2016 and 2021, 64.2 percent possessed a bachelor’s degree or higher in 2021, when compared to 55.7 percent of immigrants who landed in 2011-2015 and 33.8 percent of all non-immigrants.

When the report further dissected the group with post-secondary education, 30.2 percent of all core working-age immigrants were found to be degree, diploma, or certificate holders in a STEM field.

This number outperforms the non-immigrant STEM percentage (16) by close to a two-fold margin.

The following were the more popular study areas for immigrants:

  • Business and Administration
  • Engineering
  • Healthcare

The following, meanwhile, were the most popular areas of study for non-immigrants:

  • Trades, services, natural resources, and conservation
  • Business and Administration
  • Social and behavioral sciences

Before getting a Canada PR, more of these immigrants have higher rates of Canada pre-admission work experience and/or study experience than immigrants from previous years.

Of the core working age group from 2016-2021, for example 38.5 percent possessed a work permit, study permit, or both before becoming a PR, compared to 27.4 percent who came in 2011-2015 and 13.8 percent who came in the 2000s.

Economic immigrants make up more than half of recent immigrants in Ontario 

Immigration categories in Canada are as follows:

  • Economic immigrants and their dependents
  • Immigrants sponsored by family
  • Refugees

While the share of immigrants from the economic category increased over the years, the share of those from the family category declined over the same period. This hints at an increase in immigration based on newcomers’ abilities to meet labor market demands through employment, investment, or entrepreneurship.

Within the economic class of immigrants, those coming in through the provincial nominee program and Canada experience class increased, and those coming via the skilled worker, skilled trades, and business programs declined.

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