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Posted on May 08 2015

Non-permanent residents are now a major economic force in Canada

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By  Editor
Updated April 03 2023

TORONTO, April 29, 2015 /CNW/ - Today, nearly three-quarters of a million non-permanent residents (NPRs) call Canada home, dramatically influencing Canada's demographic and economic landscape, finds a new report from CIBC World Markets.

"In Canada, it is common knowledge that immigration accounts for more than three quarters of our population growth, but what is less known, is the dramatic impact of the meteoric ascent in the number of non-permanent residents (NPRs) on the nation's demographic landscape - mainly among young Canadians," says Benjamin Tal, CIBC's Deputy Chief Economist, who authored the report.

The report notes that the number of non-permanent residents in Canada has climbed by more than 450,000 over the past decade to a record 770,000 - with 95 per cent being under the age of 45.  Most significantly, says Mr. Tal, is that the number between the ages of 25 and 44 has doubled since 2006 accounting for all of the growth in the age group in Canada during this time.

"If not for the rapid growth of non-permanent residents, the number of that economically important age group in the Canadian population would have fallen. From both an economic and policy perspective, non-permanent residents, in general, and temporary workers, in particular, should no longer be viewed as a marginal and reversible factor aimed at solving temporary mismatch issues in local job markets.

"Rather, they should be viewed as an important demographic force capable of influencing and potentially altering the trajectories of macro-economic variables such as housing activity and consumer spending."

Their contribution, though, is far from uniform across the country, with the most significant impact being felt in Ontario and British Columbia.

"If it were not for the rise in NPRs, Ontario would have experienced a decline of 120,000 in the 25-to-44 age group," says Mr. Tal. "The impact on British Columbia is also significant, with NPRs, accounting for all of the growth in that age group."

Consequently, he says this demographic is helping reshape the country's housing market.

"It is not a coincidence that those two provinces are also the ones to experience long-lasting strong housing market activity," he says. "In fact, given the above demographic picture, it is fair to assume that NPRs play an important role in demand for rental units in both provinces - a factor that is largely behind the recent boom in the condo market in cities like Toronto and Vancouver."

The impact on Alberta is relatively muted, he says, despite the fact that the skill shortage in the province was one of the catalysts behind the past changes to the temporary workers program.

As strong as the reported growth in NPRs in Canada, Mr. Tal believes these numbers may actually understate the real tally.

The figures in the report are based on Statistics Canada's projections that use 2012 actuals rather than data subsequently released by Citizenship and Immigration Canada (CIC). The total non-permanent resident estimate by Statistics Canada is about 2.4 percentage points shy of CIC growth in 2013 and Mr. Tal believes that Statistics Canada's projection of only 4.4 per cent growth for 2014 is "way too low."

"Based on preliminary CIC data, it is reasonable to expect an overall 2014 annual increase in NPRs of no less than eight per cent," says Mr. Tal.

He notes that recent changes to the temporary foreign workers program will likely result in only a modest reduction in the stock of valid visa holders.

With the NPR population sitting at a number that, collectively, is enough to be Canada's seventh-largest city, slightly bigger than Quebec City or Winnipeg, the "numbers are simply too large to ignore," says Mr. Tal. "NPRs are a demographic force with significant macro-economic implications. Any future policy aimed at limiting their growth should be supplemented by an offsetting boost to immigration policies.

For more news and updates, assistance with your visa needs or for a Free Assessment of your profile for Immigration or Work Visa’s just visit www.y-axis.com

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