Population growth is a phenomenon that can have a significant impact on a country’s economy. Canada, known for its open-door immigration policy, has experienced rapid population growth in recent years.
However, this uneven growth poses challenges and problems for the country, which has led to the emergence of the so-called “population trap.” In this article, we will explore what the “population trap” is in Canada and how it can affect those planning to migrate to the country.
Canada’s open-door policy
In recent decades, Canada has stood out as a welcoming country for foreigners. With policies aimed at attracting talent and labor, the country has experienced significant population growth due to immigration. Prime Minister Justin Trudeau has maintained a pro-immigration stance, implementing measures to increase the admission of foreigners.
Immigration has been critical to Canada’s economic growth, bringing talent and labor to businesses. It has also made Canada one of the most multicultural societies in the world. However, this accelerated population growth poses challenges for the country.
Population trap in Canada
A “population trap” occurs when the number of a country’s inhabitants grows rapidly, but its economy cannot develop at the same pace. This means that investment by the country’s companies and public agencies is only enough to maintain current resources, making any improvement in living standards impossible.
In the case of Canada, population growth has outpaced economic growth in recent years. Although the number of inhabitants has increased significantly, the country’s economy has not been able to maintain the same rate of growth.
According to the National Bank of Canada, the country has experienced a decline in its net capital stock per capita, indicating a lack of resources for production.
Impact on housing
One of the most visible effects of the “population trap” in Canada is the shortage of available housing. Rapid population growth has far outpaced new housing construction, leading to an imbalance between supply and demand. This has led to a significant increase in home purchase and rental prices across the country.
In recent years, population growth has far outpaced new housing construction, except during the pandemic in 2021. The lack of available housing has created pressure on public services and has made access to affordable housing difficult for many residents and migrants.
Canada’s housing problem
In 2023, Canada experienced an increase of 1.2 million inhabitants, but only approximately 200,000 housing starts. This gap between population growth and housing construction has created a shortage situation in the housing market.
An imbalance between supply and demand has led to a significant increase in home purchase and rental prices. For example, the average monthly rental price of a single apartment in Canada increased by 22% in two years. In cities such as Toronto and Vancouver, rental prices exceed US$2,000.
It is estimated that, if this trend continues, there will be a shortage of approximately 3.5 million housing units by 2030. Although the Department of Immigration is optimistic and stresses that immigration contributes to labor supply and new housing construction, it is clear that additional measures need to be taken to address Canada’s housing problem.
Limitations for international students
A large proportion of foreigners who move to Canada do so through study programs. International education makes an important contribution to the Canadian economy and generates employment. Enrolling in a Canadian university secures foreign students a temporary visa, which may become permanent over time.
However, the government has taken steps to limit the number of new visas for international students. As of 2024, the number of new visas has been reduced by 35% compared to 2023. This reduction will be distributed among provinces based on their ability to provide accommodation for new residents.
In addition, the government has launched a pilot program to encourage the distribution of new immigrants to rural and northern areas of the country, where population pressure is lower. However, while these initiatives may alleviate some of the effects of the population explosion in Canada, they are unlikely to completely solve the problems of the “population trap” and housing shortages.
“Population trap” in Canada is a complex phenomenon that poses significant challenges for the country and those planning to migrate there. Accelerated population growth has outpaced economic growth, resulting in housing shortages and pressure on public services.
While Canada has implemented measures to address these problems, such as limiting visas for international students and encouraging the distribution of new immigrants to less populated areas, much remains to be done.
Lack of affordable housing and pressure on public services are urgent challenges that must be addressed to ensure successful migration and an adequate quality of life for all residents of Canada.
In short, the “population trap” in Canada is a reminder of the importance of balancing population growth with economic development. Only through careful planning and appropriate measures can we ensure a prosperous and sustainable future for the country and those who choose to migrate there.