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Recent immigrants cost taxpayers $16B a year: Fraser Institute
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Canada Politics
The common refrain is that Canada needs immigration to mitigate current and future labour shortages and to help pay the medical bills for our aging population.
The Fraser Institute says hogwash to that. The sometimes controversial right-wing think tank says recent immigrants are actually a huge burden to Canadian taxpayers.
According to its report released Thursday those who arrived in Canada between 1987 and 2004 received about $6,000 more in government services per immigrant in 2005 than they paid in taxes.
"Immigrants arriving in Canada since 1987 are not doing as well economically as immigrants who arrived before 1987," said Herbert Grubel, Fraser Institute senior fellow and co-author of the study titled Fiscal Transfers to Immigrants in Canada: Responding to Critics and a Revised Estimate.
"As a result of Canada's welfare-state policies, our progressive income taxes, and universal social programs, these immigrants impose a huge fiscal burden on Canadian taxpayers of between $16 billion and $23 billion annually."
Grubel and his co-author Patrick Grady cited recent figures from Statistics Canada's Labour Force Survey showing that the average hourly earnings of recent immigrants were $6.30 below comparable Canadian-born workers in 2010. The statistics also show unemployment rates among immigrants who had been in Canada for less than five years is now 3 to 5 per cent more than that of the general population.
The Harper government, like its Liberal predecessors, have taken a two-pronged approach to curb the declining economic welfare of its immigrants. It has implemented a comprehensive foreign credential recognition program, while at the same time investing heavily in settlement services.
But the Fraser Institute report rejects the notion that we need high levels of immigration - at least not the current levels of around 250,000 people every year. The authors say the demand for immigrants is being driven by the private sector.
"The immigrants keep wages down, which raises their profits and allows them to avoid the need to invest in the training of Canadian-born workers and labour-saving capital and technology," the authors told Postmedia News.
The report also argues that high immigration levels also exacerbate labour shortages, since high numbers fuel demand for public services such as housing, health care, education and infrastructure such as roads and sanitation.
Grubel and Grady suggest the solution to our immigration 'troubles' is to rely exclusively on applicants holding pre-arranged employment offers. In other words, no family class immigration.
"As the data show, language proficiency, work experience, as well as desirable levels of age and education, all contribute to the likely success of immigrants who have not benefited from arranged employment," they argue.
"It is exactly these characteristics, which are used by employers when offering jobs to applicants and those who possess them would therefore be able to obtain such offers."
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