Population increase in Canada breaks record, but slower growth is expected

Population increase in Canada breaks record, but slower growth is expected

The population growth rate of Canada reached a new record, capping a year in which one of the world's largest immigration programs reached maximum speed, as pressure mounted on Prime Minister Justin Trudeau's government to curb future inflows.

The population grew by 1.3 million people over the past year, to 40.8 million, according to Statistics Canada's estimate released Wednesday in Ottawa. It is equivalent to the population of Estonia and is the fastest annual pace in Canada since 1957.

With an annual rate of 3.2%, Canada now ranks among the world's fastest-growing countries, trailing only some high-fertility African nations. In 2022, the population grew 2.7%, that is, 1.1 million people, a previous record, when Canada added more than a million people for the first time due to heavy immigration.

Only 2.4% of last year's increase came from net births, and the rest was driven by international migration, mainly non-permanent residents such as foreign workers and students. Without temporary immigration, Canada's population growth would have been 1.2%.

But with plans to reduce the number of temporary residents and international students already underway, 2023 will likely mark the peak of Canada's immigration-driven population boom. Economists predict the new restrictions will halve or more the annual population growth rate.

Stunning population gains helped boost the Canadian economy amid high interest rates, but population growth strained infrastructure and services, exacerbated the housing shortage and sent rents soaring. Concern about deteriorating living standards forced the government to reduce its immigration ambition, a lesson for advanced economies that rely on newcomers to avoid economic decline.

Furthermore, the agency's real-time population clock now shows that Canada's population is approaching 41 million, just nine months after surpassing 40 million in June.

In 2023, Canada added 471,771 permanent residents and 804,901 temporary immigrants, a group that includes foreign workers, students and asylum seekers. It was the second consecutive year that temporary immigration drove population growth and the third with a net increase for this group.

It is estimated that on January 1 they lived in Canada 2.7 million temporary residents. The majority were work or study permit holders and around 12% were asylum seekers.

In another statement, Statistic Canada noted that the number of temporary foreign workers in the country's agricultural sectors tripled between 2005 and 2020, and around 10% ended up becoming permanent residents. Of them, only a fifth are still employed in agriculture: more than 60% have moved to other sectors.

“Low retention rates mean that even if temporary foreign workers in primary agriculture receive permanent resident status, “This may not solve the problem of chronic labor shortages facing this sector,” the agency said.

Last year, Some 333,000 residents moved from one province or territory to another, the second highest number since the 1990s, and the third consecutive year in which interprovincial migration exceeded 300,000 emigrants.

Oil-producing Alberta recorded the largest net increase in interprovincial migration in 2023, the largest increase nationally since comparable data became available in 1972. Nova Scotia, New Brunswick and Prince Edward Island also saw net increases.

On the contrary, Ontario, the most populous province, lost the most people. In British Columbia, more people also left than last year, the first negative net migration since 2012.