Canada’s Record Population Growth Needed, But Expect “Stress And Inflation”: BMO

Canada continues to outperform its peers for population growth. Statistics Canada (Stat Can) data shows record population growth in 2022. The increase was driven entirely by immigration, with most of it “temporary” labor. One of the country’s Big Six banks believes the boom is needed to help the country’s long-term labor market issues, but first, it’ll add to infrastructure stress and inflation.  

Canada Hit A New Record For Population Growth

Canada’s population ripped higher—entirely due to immigration. Population estimates rose 0.7% (273.9k) to 39.6 million people. That puts the estimate 2.7% (1.1 million) higher in 2022. The country has never seen such a rapid increase in population. 

Source: Stat Can; BMO Economics.

Temporary Immigration Is Driving Canada’s Population Growth

Canada’s race to be the fastest-growing G7 country depends entirely on immigration. Natural growth, births minus deaths, accounted for just 6,263 people in the final quarter. Net international migration represented the remaining 267.6k people for the quarter. 

Stat Can made a point of emphasizing the role of temporary immigration behind the surge. Non-permanent residents represented 607,800 of the 1.1 million increase in 2022. 

“This is almost entirely an immigration story, led by a massive rebound in nonpermanent resident flows (i.e., international students and temporary foreign workers),” said Robert Kavcic, a senior economist at BMO. 

Canada Needs The Population Growth, But It Will Drive Infrastructure Stress & Inflation 

Canada’s lack of natural population growth means it faces a shortage of prime-aged workers. “Suffice it to say that the taps on immigration are fully open, which comes with a purpose, but also a near-term cost. Canada needs labor supply with the peak of the Baby Boom now in the 60-65 cohort,” he said. 

The surge in temporary immigration is one solution to the labor shortage. While it’s faster than natural growth, it isn’t an immediate solution and comes at a cost. 

“… integration of new Canadians into the labor market takes time. While that is going on, these flows add to aggregate demand, infrastructure stress, and inflation pressure immediately, while weighing on per-capita growth,” said Kavcic.



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  • Mark Bayly 1 year ago

    The immigration system is a disaster that is bankrupting the country.

  • Ray 1 year ago

    They should have allowed the immigration to come years ago and we would have been on par with the US. Now that everything is collapsing because of their past corruption and mistakes, they’re trying to fix it all at once. Which is making everything even worse.

  • Miff Tacklem 1 year ago

    Isn’t it interesting that this mass immigration is obviously fueling demand and inflation but in its never ending incompetence/ politicization, Stats Can is telling us that the rate of inflation is decreasing? Who to believe, Stats Can or your own lying eyes?

  • john hartley 1 year ago

    No attempt to even quantify the inflationary pressures or the infrastructure inadequacies but an assurance that all would be better in the future. Well we know the bank and the Laurentians will benefit enormously from rising property values and expanding GDP. As for the rest of us, not so much, maybe, ever.

  • Robert Angus 1 year ago

    If Canada was properly managed, we would not need huge immigration. Look at countries like Switzerland.
    The tax structure would support automation and other investments that would improve productivity.

  • Average Man 1 year ago

    Something is going to break. I’m not sure what, but something will break.

    • Mark Croucher 1 year ago

      Health care & affordable housing. Already broken.

      • Gary Beemer 1 year ago

        Exactly, what will be the next social benefit that breaks. By the time this has runs its course, all the reasons people would want to come to this country will be a distant memory.

  • Brent J Eichler 1 year ago

    Where are the investments in transportation, housing, health care, and other infrastructure to accomodate all this immigration?

  • Jonny O 1 year ago


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