Canada chased rapid population growth to fill its soaring job vacancies. Now it’s running out of jobs, and still has near-record population growth. National Bank of Canada (NBF) believes this is a concerning setup for new immigrants who are arriving to the tightest job market in 7 years. Not only is this driving unemployment for newcomers, it’s also driving the rate for young adults who compete for similar roles.
Canadian Unemployment Driven By Excess Population Growth
Canadian unemployment is rising but it’s mostly contained to certain demographics. The unemployment rate rose 1 point over the past to hit 6.3% in June, the highest non-pandemic rate since 2017. The tightening job market means job vacancies are disappearing just as fast as they appeared. That’s a problem for the massive inflow of immigrants expecting to address a labor shortage.
“Businesses’ appetite for workers is not keeping pace with population growth, which continues to push up the unemployment rate,” explains Matthieu Arseneau, deputy chief economist at NBF.
Canada’s Immigrants Arrive To Financial Crisis-Like Unemployment
We previously discussed unemployment rising much more sharply for immigrants. Newcomers within the past 5 years have an unemployment rate of 11.7%, more than double the rate of other Canadians. It’s also worsening the rate for young adults (12.7%), who compete for similar entry-level roles.
“The weak labor market is particularly hard on those trying to enter it, including immigrants,” he explains. “For new immigrants, the increase in the unemployment rate since the trough in 2022 (+5.8 percentage points) is already equivalent to the increase recorded during the global financial crisis of 2008-2009.”
Most Canadians wouldn’t compare the current job market to the global financial crisis. However, that’s exactly what the shift feels like to recent immigrants and young adults. It’s also going to get a lot worse due to the current setup.
Canadian Job Market To Get Worse For Immigrants & Young Adults
NBF is concerned the picture is about to get a lot worse in the near-term. The job vacancy rate for industries where newcomers typically find employment is falling sharply. About 6.6% of these roles were unfilled during the 2022 peak, but have since fallen to 3.2% as of April. It’s the fewest jobs since 2017 for this demographic.
Source: NBF.
“According to Statistics Canada’s population clock, demographic growth remained outsized in Q2. Such strength, if it were to continue, makes us concerned about the economic conditions that await newcomers in the coming months,” warns Arseneau.
Canada has recently announced it will throttle immigration with higher barriers to entry. However, economists have expressed skepticism of whether there’s any reality to the plan. Concerns have also been shared regarding potentially offsetting cuts made in other areas, ultimately undermining the throttle.
Things are getting really rough for recent grads. I don’t think this is due to immigration per se, but a dept was looking to hire a jr analysts and got 400 resumes. That’s absolutely nuts, and you know it’s going to be impossible to actually go through them.
Doesn’t matter how good you did at school or how important your extracurriculars were, but opportunity has totally dried up in Canada if you need to know someone to get them to look at your entry job application.
At this point if you’re coming to Canada and know there’s no jobs and only criminals can afford shelter at the current prices, that’s on you. Enjoy providing cheap labor.
When I was younger Canada was the option because it provided better value than the US—hard place to make it but you can establish some sort of security, home, and have a family if you grind.
Now immigrants need to grind just to survive. Honestly, I really do feel bad for people who are sold that they just need to work a little harder, because it’s an absolutely bonkers setup for the whole country.
I’ll agree with it’s a lot harder today. People making a lot more than I did starting out aren’t even close to having a similar standard of living.
It all started with the “smaller houses make things more affordable” narrative.
People now spending a greater share of income on a single person apartment than I did on a place where I could raise a whole family. They think it’s just a temporary step, but let’s be real—you’re almost 40 when you buy that place. When are you having a kid, at 60?
I know it sounds like I’m a boomer but this wasn’t that long ago—I’m talking about 2000s.
All of these immigrants think they’ll be Toronto millionaires. They would have a much better time if they came to Calgary where houses are still affordable, or Halifax.
Halifax has no jobs unless you’re working for the government, and even then you’ll be pushing your income to the limits to buy a modest home. Then if Pierre wins, they’ll purge employment here.
Didn’t I just read that Calgary has one of the highest unemployment rates?
So now we are going to be allowing millions in here without much chance of even getting a job ??? which means they will all go on government support?
How far this country has fallen.
Short the C$ big time.
Justin needs to increase immigration to at least 2 million a year to help support the economy and also support house price increases. Many many many many more international students are needed.
And what is the root of this problem?
Trudeau will bring in millions more before he gets dismissed.
They’ve left their home countries where they had jobs, owned property, and were treated as human beings…in seeking a better life in Canada working as modern day serfs paying rent and treated as a second class citizen.
I’ve been saying it for years and it’s finally coming true. The almost zero percent interest rate will go down as the worst financial experiment in modern history. What did government think would happen if you could borrow for next to nothing. Now we are paying for that failed experiment, priced needed to come down years ago but they propped it up with low interest. Now the big correction will happen!
Are there no schools in India or china? these people need to start building schools out there and work in their own country. We don’t need colonizers from Asia.
Myself, and about 30 other people, just lost our jobs to immigrants. The company termed it “Restructuring” but simply brought in immigrant workers to fill many of the positions. Many of these workers don’t even have full citizenship. Sorry if I’m not sympathetic to immigrants coming here and not being able to get a job.
If i walk into a store and see it’s packed with immigrants, i take my business elsewhere.
Timmigrants: go home, you are not needed here.
The rising unemployment rate, particularly among new immigrants and young adults, paints a worrying picture. With businesses not keeping pace with population growth, newcomers face a tough time finding employment, reminiscent of the struggles during the global financial crisis. It’s crucial for potential immigrants to be aware of these challenges and for policymakers to address the economic conditions that are making it difficult for new arrivals to find work. For more information on moving to Canada and finding a home, visit http://www.vancouverhomesearch.com