Desjardins Report Advocates for Integration of Skilled Newcomers to Mitigate Canada's Housing Crisis
In a recent release by Desjardins Economic Studies, the advantages of welcoming skilled newcomers to Canada have been underscored where the report emphasizes the importance of integrating newcomers into the labor force, particularly within the construction sector, to address prevalent labor shortages.
However, it also highlights the need to overcome barriers that hinder these workers from contributing fully, notably discrimination and harassment within the construction industry.
The report advocates for Canada to adopt more effective strategies in welcoming newcomers, particularly within the construction sector. It criticizes the limited intake under the Federal Skilled Trades Program (FSTP) and calls for a more strategic selection of immigrants with robust long-term economic prospects, echoing sentiments from the Royal Bank of Canada (RBC).
Canada's Housing Affordability Crisis Intensifies
The recommendation to embrace skilled newcomers comes amidst a historic housing affordability crisis gripping Canada. The nation faces challenges in meeting the housing demands of its rapidly expanding population, as highlighted by Statistics Canada's third-quarter data, revealing a population of 40,528,396.
The Canada Mortgage and Housing Corporation (CMHC) estimates a staggering shortfall of 3.5 million housing units, exacerbating the affordability crisis, with average home prices soaring to $657,145 as of December 2023.
Stagnant Immigrant Representation in Construction Sector
Despite the escalating demand in the construction industry, Census 2021 data suggests a stagnant representation of non-permanent residents (NPRs) and immigrants, comprising less than 22% of the construction workforce. The report underscores minimal growth since 2019, with just 5% of employed NPRs engaged in construction roles, despite being the fastest-growing segment of the population.
Factors Contributing to Housing Shortage
The Desjardins report identifies various factors contributing to the housing shortage, beyond immigration trends. Escalating material costs, compounded by supply chain disruptions during the COVID-19 pandemic and high interest rates, exacerbate the crisis.
Low productivity within the housing sector further compounds the issue, prompting recommendations such as the creation of pre-approved building plans to expedite municipal approvals and financing.
Government Initiatives Fall Short
While Immigration, Refugees, and Citizenship Canada (IRCC) have introduced initiatives to attract skilled newcomers, such as category-based selection draws, their frequency remains limited. IRCC's efforts to address labor shortages in critical sectors, including trade occupations, have seen only two draws, issuing 2,500 Invitations to Apply (ITAs) for Express Entry candidates with experience in trade occupations.
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