This is important to understand when assessing Canada’s economy.
One of the challenges that comes with a massive surge in immigration – aside from the surging housing market and overburdening of our social services – is how to assess the impact on the economy.
In particular, overall GDP and employment figures can be heavily skewed in a way that looks favourable to the government unless we factor in the rapid rise in population.
Today’s jobs report is an example of this.
Canada added 37,000 jobs in January, and the unemployment rate – which doesn’t include those who have given up looking for work – fell slightly from 5.8% to 5.7%.
However, as noted by Statistics Canada, population growth outpaced employment growth.
Canada’s population grew by a whopping 0.4% in January alone, while employment grew by 0.2%.
Thus, the employment rate fell from 61.7% to 61.6%.
The participation rate also delined, dropping from 65.5% to 65.3%.
What’s happening is that our population is rising at an incredibly rapid pace, which of course will generate more overall economic activity. But the job market is unable to keep up with the rising population.
We also see this with GDP.
On a per capita basis, our GDP has been in decline for quite some time, meaning Canadians are becoming poorer on average.
Until Canada moves to more sustainable immigration levels, and until we bring taxes down in order to incentivize more actual economic growth, our standard of living will continue to decline.
Spencer Fernando
