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Welcoming more immigrants to N.L.

By: Tony Fang and David Brake | April 13, 2017

It’s not just the right thing to do — it’s also the smart thing to do.

Tony Fang
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Members of the Association for New Canadians' (ANC) Youth Group joined in the annual Mummers' Parade in St. John's last December. The provincial government hopes to welcome upward of 1,700 new immigrants annually to Newfoundland and Labrador by the year 2022. ANC / Twitter.

The provincial government’s announcement of its five year plan for immigration puts attracting more people to the province back in the spotlight.

The government has set a target of welcoming 1,700 immigrants by 2022 — 50 percent more than were allowed in 2015, and more than three times the number who came 10 years ago.

While on the face of it this may seem a dramatic increase, this is actually, if anything, a conservative reaction to the situation we find ourselves in. The move may be hard to understand for those who are jobless, or whose jobs are under threat in this province, but it is in fact not primarily an act of liberal benevolence towards needy people elsewhere.

If we successfully bring in large numbers of immigrants it will, on balance, be beneficial not just to employers but to the whole of the province’s population — yes, even many of the poor and unemployed.

While Canada prides itself on being supportive of immigration—and polls suggest Newfoundlanders and Labradorians are actually among the most welcoming—suspicions remain that immigrants are a drain on the province’s resources or that they take jobs away from those who live here.

However, years of research both here in Canada and overseas make it clear that, if anything, the opposite is true; welcoming more immigrants wouldn’t make any difference to our unemployment rate, and on balance they would bring more money into the provincial government’s coffers. How can this be?

Well, taking employment first, currently more than half of immigrants are brought in through the Provincial Nominee Programme, which requires that applicants already have job offers, that the jobs they were hired for were advertised for at least six weeks beforehand locally, that the employer show local applicants were not adequate, and that the work pays the normal rate.

Of course, there may be abuses in such a program but at least on the face of it the immigrants who come through this program are filling skills gaps that companies and organizations find it difficult to address. Companies that can’t find people to hire in key positions due to skill bottlenecks can’t expand and hire additional people from here in Newfoundland and Labrador.

As the government report points out, thanks to Canada’s fastest-ageing population and its lowest birthrate, the province’s workforce is projected to drop by 10 percent by 2025 – and that trend is only expected to get worse.

To the extent that immigrants use hospitals and, in particular, schools, they will help keep those facilities viable, particularly if they move to some of the remote areas where the population is collapsing.

There are important indirect effects on the economy too. Immigrants spend their money in the local economy, they invest here—especially in the housing market—and pay taxes, all of which creates jobs in the public and private sectors. They are more likely than locals to start their own businesses, creating new jobs for others which would not otherwise exist. They bring new ways of doing things and fresh ideas, which can stimulate innovation and creativity, and some of them can tap into the connections they built up overseas before they arrived, which boosts international trade and international businesses.

What about the cost side of the ledger? Don’t immigrants use our healthcare, schools and other welfare programs? Certainly they do make use of some welfare programs at various points in their lives but for the most part they can’t access unemployment insurance until they have contributed to it and, crucially, the evidence to date suggests that because they are younger and healthier than the average Newfoundlander and Labradorian they bring in more in tax income than they use in public spending because they have to wait longer to receive social security benefits, such as pensions, while paying taxes almost immediately.

We conducted extensive research into the national economic benefits and costs of immigration for Canada. Applying those calculations to Newfoundland and Labrador we estimate that over the next 10 years alone the additional 1,000 immigrants per year that the government hopes to attract would bring in around $40 million to the government’s coffers over 10 years. And to the extent that immigrants use hospitals and, in particular, schools, they will help keep those facilities viable, particularly if they move to some of the remote areas where the population is collapsing.

We should not forget the benefits that immigrants themselves and their families gain from coming here. Even though many of them are initially working at jobs for which they are overqualified, they are generally earning significantly more than they would in their home countries and are often able to send back money which helps their own families overseas and the communities they live in to thrive. This remittance income is three times more than the size of development aid, according to a 2016 World Bank report. The largest group of immigrants last year came from the Philippines, for example, and in 2015 more than 10 percent of that country’s GDP came from people overseas sending their money back.

The government’s announced plans are a good first step in the right direction, but much more can be done to benefit from immigration. If the government reached its target for immigrants—just over 2,000 of them by 2022 if you include the increased numbers also projected to come from the Atlantic Immigration Pilot—the number added to our working-age population will still be dwarfed by those lost through retirement and out-migration.

The new ideas and cultural diversity that immigrants bring make Newfoundland and Labrador a more fun and interesting place to live.

Could we draw more people to the province? Though we do not have the same things to offer as Ontario, Alberta or B.C., the province of Manitoba has shown how a focus on attracting and retaining immigrants can succeed. If we admitted immigrants at the same rate that Manitoba did last year, we would be bringing in almost six times as many as we do now. An additional 5,000 immigrants a year—instead of the additional 1,000 the government is seeking—could, we estimate, bring in as much as $200 million over the next 10 years. And, crucially, by making Newfoundland and Labrador visibly more diverse it would make our province more attractive for future immigrants as well.

But it’s not all about money. The new ideas and cultural diversity that immigrants bring make Newfoundland and Labrador a more fun and interesting place to live. The thriving restaurant scene in St John’s which has helped boost tourism in the province could not have survived and grown without talented immigrants from across the world. Many of the Newfoundland and Labrador traditions we now celebrate, after all, have come from the last wave of Irish immigration, which was greeted at the time with concern and suspicion.

Seeking not just an increase in immigration, but a radical change in our immigration policies and practices, may be controversial and will certainly require hard work to manage successfully. But given the long term problems an aging and shrinking population will bring, it is the best way to ensure the future of this province. And building on our traditions of hospitality, it is also the right thing to do.

Tony Fang is an economics professor, a leading expert on labour economics and migration, and is the Stephen Jarislowsky Chair in Economic and Cultural Transformation at Memorial University in St. John’s. Currently he sits on a World Bank’s Expert Advisory Committee on Migration and Development and holds the J. Robert Beyster Faculty Fellowship at Rutgers University in New Jersey. He received 11 research awards from the Social Science and Humanities Research Council of Canada and five research grants from Human Resource and Development Canada. He is also a Fellow of Royal Society of Arts (UK).

David Brake is a journalist, editor and academic researcher who has “come from away” himself — from the UK and, more recently, Toronto. He’s happy to be nearly through his first Newfoundland winter.

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