Former Bank of Canada governor suggests mass immigration hampering Canadian productivity

THE CANADIAN PRESS/Tom Hanson

As Canadians grapple with soaring home prices and a rising cost of living, former Bank of Canada governor David Dodge has suggested that mass immigration is also impacting Canada’s competitiveness on the global stage.

A report prepared in part by Dodge for the law firm Bennett Jones outlined Canada’s declining productivity in relation to other advanced economies. It also posited that the recent high number of low-skilled immigrants entering Canada risks further negatively impacting wages.

As detailed in the National Post, Dodge's report declared that "In the last years, we have altered an economic immigration system that stood as a model for the world." The report added that "Poor administration and the abuse of some programs are damaging the credibility of the system for immigrants and Canadians."

Canada has accepted record-numbers of immigrants in recent years, and the population of the country grew by over one million people in 2022. The United States also grew by approximately one million people in 2022, although its population is about 10 times the size of Canada's.

Dodge argues in the report that Canada's high number of unskilled workers is propping up "uncompetitive" businesses which will hurt Canadian productivity in the long-run.

Changes could be coming to Canada's immigration system, says Housing Minister Sean Fraser

The minister said the Trudeau Liberals needed to continue looking at reforms to Canada's temporary residency programs.https://t.co/uGRpvFLnlg

— Rebel News (@RebelNewsOnline) December 13, 2023

According to the Fraser Institute, the Organisation of Economic Cooperation and Development (OECD) predicts Canada will be the worst performing advanced economy until the year 2060.

Dodge spoke to the Globe and Mail about these issues, explaining “We can add jobs up the ying yang, and still get poorer – unless we raise productivity of the people that are working. That, fundamentally, is the problem."

Canada has a "huge advantage" economically because of record immigration levels, explains Deputy PM Chrystia Freeland, who describes the country as "one of the few" open to immigration. pic.twitter.com/4kD0jDfGrN

— Rebel News (@RebelNewsOnline) December 5, 2023

He also told the Globe and Mail that “The last thing we want is a bunch of low-productivity businesses hanging on because we provide them cheap labour. That’s not the way we’re going to raise national income."

Dodge's report indicated that Canada could experience "no increase in perceived living standards” and a new age of "reduced consumption" if policy changes are not implemented.