Immigration: Good or Bad?

CANADA - In the early 1990s immigration actually helped saved the Canadian economy from the recession.

Why? Home sales. More population, more demand for houses and housing, higher real estate prices, more jobs for construction workers, more workers with cash to buy cars, more cars being built... you get the picture.

In other words immigration doesn't hurt the economy, it helps it.

So during the current recession, will immigration help get the economy back on track?

Or should Canada should follow the recent actions of countries like the U.K. and Australia in tightening up immigration. There is a perception amongst amateur economists that too many immigrants arriving in tough times will only strain Canada's resources and swell welfare rolls and unemployment lines.

So the question is whether immigrants drive up unemployment and welfare caseloads or help stimulate a troubled economy by bringing in extra foreign cash. Data suggests that many uneducated immigrants coming to Canada during the early 1990s never recovered from chronic unemployment. The complete opposite is true of educated immigrants who have prospered and now, on average, make more money than people born in Canada.

So really this issue comes down to bringing in more students and educated immigrants, particularly those with skilled trades or entrepreneurs with lots of cash to start their own business (there is a loophole in Canadian immigration laws that allows immigrants to fast-track their entry into Canada if they have money and are looking to start their own business).

The people who contribute the least to the Canadian economy is war refugees, who are often uneducated, speak very poor English or French and have difficulty finding work.

And then there's the immigrants who are educated, but their degrees aren't acknowledged in Canada, so we end up with Pakistani doctors driving taxis and Korean engineers working in convenience stores.

"These people came here and had a tough time getting any decent job," said University of Toronto sociologist Jeffrey Reitz. "Their professional careers got derailed. Their skills became stale. They were stuck even when the economy bounced back. "These people are worse off for their entire life."

In 1993 Canada's unemployment rate rose to 11.4%, the same year 256,703 people arrived, the highest level in decades. At the time Canada was taking in refugees from the Gulf War.

Some amateur economists think that wars boost the economy, but this is actually not true. They believe war helps the economy because of the transition from the Great Depression in the 1930s to World War II and the post WWII economic boom. But in reality the USA's economy had already recovered from the depression by 1935. During the war the economy soured, and after the war was over the economy rebounded. War is really just a drain on government coffers and bankrupts the government, resulting in future tax increases.

War refugees arriving in Canada really have few options left. As a moral and well-meaning country it is Canada's responsibility to take in refugees. Where we are failing them however is after they get here we need to be schooling them, training them for the workforce and making them active parts of the economy.

The same principle should be applied to all Canadians, especially regions with high unemployment. Native Canadians for example could benefit a lot from more training/educational programs.

We see what happens when people have little education, few jobs opportunities and high unemployment... alcoholism, depression and higher suicide rates.

Meanwhile regions with lots of educated immigrants tend to see a strong economic boom.

That is the case for Markham north of Toronto, where the population grew 80%, from 145,500 in 1991 to 261,600 in 2006, mainly due to an influx of immigrants. The population boom has led to rapid residential and commercial development, making the town the GTA's fourth-most populous municipality and attracting big corporations such as IBM and Honda Canada.

The demographics of Canada's newcomers has also evolved. The inflow of wealthy Hong Kong tycoons, a staple in the early 1990s, came to a halt after the island's return to China in 1997. The majority of skilled immigrants arriving now may be financially established but they aren't necessarily as wealthy.

What Canada doesn't need however is the influx of "temporary workers" who come to Canada on two or three year work visas to fill supposed labour shortages, and then they end up not working because of recession layoffs and can legally stay in Canada until their work visas expire, so they find other jobs.

In 2008 Canada admitted 193,000 temporary workers.

Conclusions:

Immigrants good.

War refugees, we need to be educating them.

Temporary workers? Don't bother.

See Also:
Canadian Immigration and Population Surge
Canada's Worker Shortages
Canadian Immigration Kidnaps & Deports Children