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Just to be clear on why immigration levels are the biggest factor when it comes to #cdnecon's future growth:
Economic growth (as measured by GDP, really the only game in town) only comes from three sources in the global system:
+ https://twitter.com/ArmineYalnizyan/status/1296071210317619203
Economic growth (as measured by GDP, really the only game in town) only comes from three sources in the global system:
+ https://twitter.com/ArmineYalnizyan/status/1296071210317619203
1. Labour market growth (add people and stir)
2. Productivity growth (do more with less/something that hasn't been done before)
3. Net exports (exports minus imports, which if positive adds to GDP)
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2. Productivity growth (do more with less/something that hasn't been done before)
3. Net exports (exports minus imports, which if positive adds to GDP)
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[yes we love to laugh at The Donald's economic analysis, but net exports have been the secret sauce in the Global North's growth strategy for decades - maybe longer. Mathematically adds to/subtracts from GDP, you love it when it's a positive and worry when it's a negative.]
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So, going backwards from that short list of 3 things that grow an economy:
1. No major export-led growth strategy on the horizon, with US or any other trading partner.
2. Productivity has stalled out since 2014 in #cdnecon, due to collapsing oil prices (O&G biggest investment)
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1. No major export-led growth strategy on the horizon, with US or any other trading partner.
2. Productivity has stalled out since 2014 in #cdnecon, due to collapsing oil prices (O&G biggest investment)
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3. Pre Covid-19 labour market projections envisaged a Canadian labour market that would shrink not grow by 2025 without newcomers (decades of falling fertility rates not producing enough people entering the labour force to make up for the escalating numbers retiring).
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So all net new labour force growth was poised to come from newcomers by 2026. Given the status of other drivers of growth (productivity and net exports) we are looking at long term economic decline if we don't add more people from abroad.
There's a hitch, though.
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There's a hitch, though.
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The newcomers come as temporary residents and permanent residents. We have become waaaaay more reliant on temporary residents (TR) than permanent in the past 20 years. Few TRs make the transition to permanent. We need them but we don't want them to stay.
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This antipathy is both economic and political.
Economic because so many people now unemployed (yet labour shortages also abound...hey that's life, during recessions or in good times, but people freak out about "letting in" more people when unemployment is high - POLITICS)
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Economic because so many people now unemployed (yet labour shortages also abound...hey that's life, during recessions or in good times, but people freak out about "letting in" more people when unemployment is high - POLITICS)
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People are reluctant to travel during a global pandemic. But if we are also closing doors to them, esp post- pandemic, we are hurting ourselves economically.
Post-pandemic, there will be a global competition to attract newcomers, because the entire rich Global North is aging.
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Post-pandemic, there will be a global competition to attract newcomers, because the entire rich Global North is aging.
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But you can be sure there will be political voices that say it is unreasonable to let people in given unemployment; and if they do, it should be only to fill labour shortages "because Canadians won't do the work" (and that's always an ask for temporary foreign/migrant workers)
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Both strategies tend to minimize our economic potential. Fewer people with purchasing power means less GDP. Period.
An aging population has a bigger cohort with less purchasing power.
More temporary workers mean more churn, less protection, and less wage growth.
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An aging population has a bigger cohort with less purchasing power.
More temporary workers mean more churn, less protection, and less wage growth.
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This is not an easy problem to fix, politically or economically; but it *is* straightforward, and it is an essential economic issue, based on the math of where economic growth comes from.
For those who want de-growth, or at least focus shifted from GDP growth....
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For those who want de-growth, or at least focus shifted from GDP growth....
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I am sympathetic to the idea of not fetishizing GDP, but we can't celebrate its decline because this is the amount on which public revenues are based, and public revenues are where our quality of life comes from, particularly for those too old, too young, and too sick to work.
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So whereas I don't think GDP growth is the be-all and end-all, slowing economies don't enhance lives, and they are very prone to wrecking the lives of those most vulnerable.
Anyhoo: of all the economic stories out there - Covid, debt, tech - immigration is the biggest.
The End.
Anyhoo: of all the economic stories out there - Covid, debt, tech - immigration is the biggest.
The End.
