Trudeau's immigration policies are working

Bold leadership to build Canada's population was long overdue

Canada enjoys one of the largest land masses on Earth with abundant natural resources and a well-educated population. All that has kept Canada from emerging as a world power rather than an also ran is that it has few people. As the population has aged, the number of working age Canadians has fallen in relation to the number of senior citizens putting enormous pressure on the country’s economy with the tax base not keeping up with the costs to support health care and old age pensions. This demographic problem has been a serious issue for decades. In the mid-1980’s I attended a Board of Trade conference called the Ontario Economic Summit and listened to David Dodge correctly predict that while there were seven working Canadians for every retiree at that time, that ratio would fall to three working people for every retiree by today. The Fraser Institute called out this problem in a 2022 article predicting the imbalance was likely to get worse. The data are troubling.

I am no fan of most of Trudeau’s policies and particularly negative about his specious claims that CO2 causes climate change. I have been a critic of his policies since he was elected and argued they have contributed to inflation and damaged Canada’s economic health. But in dealing with the demographic problem, Trudeau has been dead right despite significant opposition.

Canada’s population reached 40 million recently spurred by record immigration. The new Canadians fill a major gap in the demographic profile and add materially to the strength of Canada’s economy. Canada has always welcomed immigrants but Trudeau has taken it to a new and in my opinion necessary level. The result has been an increase in the number of Canadians employed relative to those unemployed, aiding the country in carrying the massive debts the Trudeau government has piled on.

Source: Bloomberg

The immigration has put pressure on already stretched housing markets and that issue will take years to resolve but both federal and provincial governments are moving to enact policies to accelerate home building and over time the supply and demand for homes will come back into balance. Economists were quick to project the burden the demographics imbalance would place on millenials as the workforce aged and the costs of support for seniors grew beyond the tax base’s ability to carry the costs and they were right if the rate of immigration remained flat. Trudeau appears to have seen this issue squarely and encouraged far more rapid intakes of immigrants than was the norm before his 2015 election.

I applaud Trudeau for his courage in taking such bold action to try and rebalance the age structure of the Canadian population and add workers with the skills needed to build industry and fill the supply gap in residential construction. I remain a harsh critic of his fiscal and climate related policies which I see as a threat to Canada’s unity as much as to its economic progress.