Immigration – Manitoba’s Lifeline?

Commentary, Immigration, Daniel Klymchuk

Carved out of the wilderness by people seeking a better life, Manitoba now faces a hidden crisis. Our rate of population growth sits near zero and the average age on our census rolls goes up every year. Birth rates hover around 1.6 children per couple, far below the 2.2 rate needed just to stay even.

Last year Manitoba attracted only 4,584 new people, just over two percent of the total immigration to Canada. If these numbers followed existing population patterns, our share of new Canadians would be closer to four percent. But we also lose thousands of our youngest and brightest every year to other provinces and countries, and the demographic bubble known as the baby boomers is starting to retire out of the work force. The dimensions of the crisis couldn’t be plainer. Who’s going to be left to do the work that pays the public’s bills?

An aging population implies higher costs for health care. If we impose higher taxes on our shrinking pool of productive workers to pay for it, we face further losses to other jurisdictions. The stark choice becomes still higher taxes or reduced public services. The only way out is to bring in more people.

The numbers above would be far worse if not for a federal-provincial agreement signed in June 1998. It allowed the Province to nominate 500 applicants for immigration directly, without going through the federal process. The cities of Steinbach and Winkler have taken full advantage of the change. Using a private immigration service, these two communities have since imported about 1,200 workers, plus their families, from Germany. This strategy brought them population growth rates of 17% and 15.5% respectively over the last five years. If Winnipeg had grown at the same rate, we would have an additional 100,000 people today.

A new Frontier Centre paper describes how Manitoba could create a fast track for immigration (see below) and replicate that success on a larger scale. If we expanded the nominee program from 500 to 5,000 per year, we could, with their families, bring in another 25,000 people. Since a lack of fluency in English creates the greatest difficulty for newcomers, Manitoba’s immigration budget would have to be substantially raised from its current $8.9 million per year or $1,941 per immigrant, to a level that will get the job done. Even tripling that expenditure would be cost effective, since the new workers would begin to expand the tax base almost immediately. Israel increased its population by 20% in the last five years by underwriting “absorption centres” to assist with transition issues like language and culture.

A wider view of the economics of immigration shows that this spending makes sense. Besides a wider, more diverse tax base and a reversal of Manitoba’s chronic outflow of workers, we would capture the money spent in other countries to train and educate these people. Most immigrants have high school or better, which translates into a saving of $50,000 to $150,000 per claimant, depending on the individual’s education. Adding this value at no cost justifies a substantial expense to source the best applicants and to acclimate them.

Typically immigrants are younger and in better health than our native-born population. That means they will be in the work force longer and make fewer demands on our medical system. But where do we find the jobs to keep them busy? An aggressive immigration policy would entail addressing substantial barriers to employment.

The process currently used to evaluate an applicant’s education and skills is fraught with problems. Professional associations and unions often impose unnecessary requirements for re-learning on experienced applicants. Manitoba already has many trained engineers, medical professionals, accountants and the like who are forced to find less productive work because their skills are not “recognized”. This must change. Prejudices must be put aside, or countered by government fiat.

This might exacerbate another existing problem, where claimants present false documentation as to skills or education. The issue of retention of immigrants in Manitoba would also arise, because it makes no sense to open the public purse to increase levels of immigration only to lose new people quickly to other provinces. Both of these problems could largely be overcome with private immigration services. Although costly, about $3,000-5, 000 per applicant, these agencies have a proven track record in pre-selecting people. Simply “taking applications” does not work for Manitoba like it does for Ontario. Potential immigrants must be screened for credentials and adaptability before they arrive and, as a condition for assisting their transition, asked to remain in Manitoba for a minimum length of time. Our consular system is not currently equipped to do that job, but private agencies motivated by financial incentives for success are.

At the end of November, the two levels of government announced they had increased the nominee program from 500 to 750. While this is encouraging, the new number falls dramatically short of a meaningful program. As Steinbach and Winkler are proving, the most valuable resource in the new economy is people. Like them, the rest of Manitoba should think seriously about attracting new ones.