New Faces in the Crowd: Economic and Social Impacts of Immigration-Highlights

1.In 1990, the federal government commissioned The Economic Council of Canada (24 members–primarily from business–with the help of 8 university professor consultants) to determine immigration’s net economic benefits to Canadians. Their conclusion was that the benefits are very small (around 1% gain in per capita disposable income of hosts by the year 2015).

2. The ECC did this study because of border pressures from refugee seekers; the possible burdensome costs of health and other services for an aging and decreasing population; the prospect of using immigration to maintain the country’s population growth.

3. In reaching its conclusions, the ECC looked at historical data. They discovered that immigration has not been necessary for the country’s population growth nor for its prosperity. For much of Canada’s history, natural increase, not immigration, has driven the growth of population. There is no sustained correlation between immigration and economic growth. The fastest growth in real per capita income occurred at times when net migration was zero or even negative.

4. In reaching its conclusions, the ECC also looked at three generally agreed yardsticks:

A. Efficiency—nothing significant is gained by immigration

B. Filling Labour Market Gaps–Canadian workers lose as a result of competition from immigrants; there is no reliable way to detect gaps in the labour market.

C. Spillover Effects–Although there are claims that newcomers are more energetic, more productive, and more hard-working,  there is no real evidence.

5. The ECC concluded that a higher rate of immigration would cushion the demographic fiscal blow, but only slightly. The costs of social assistance and language training would offset the small future saving.

6. With immigration levels of 0.4% and 0.8%, by 2015, the populations of Canada’s three major urban centres (MTV: Montreal, Toronto and Vancouver) would increase, Toronto and Vancouver substantially.

7. Canada’s refugee system is being overburdened. Since the 1980’s, there has been a very rapid increase in the number of refugees arriving on Canadian soil and claiming refugee status. Despite several ministerial reviews (amnesties), the situation is not getting any better. The ECC found that the projected costs, which do not even include the cost of the refugee-determination process, are far beyond the value of any gains in scale economies or savings in tax and dependency costs that might accrue to Canadians from these claimants. Unlike most other refugee-receiving countries, Canada guarantees refugee claimants virtually the same legal and social protection as its citizens.

8. For humanitarian, not economic reasons, the ECC recommended that immigration levels be gradually increased to 1% of Canada’s population by 2015; that Ottawa should double its commitment ($55 M in 1990) to combat racism and foster tolerance; that social friction should be measured consistently and regularly; that Canadian attitudes towards multiculturalism should be measured again and that immigrant levels of satisfaction towards life in Canada and attitudes towards Canadians should be measured; that men and women should have equal access to language training; that language training should be partially charged for; that the balance among the immigrant classifications should be kept at 1990 levels; that the investor class should be carefully monitored, possibly abandoned; that a balanced intake across all occupational groups should be aimed at.

9. Gains are possible, but cautious expansion should be our watchword.