Canada: Immigrants account for 33% of all business owners
Posted on November 5, 2020
As per Statistics Canada, “By 2036, the share of immigrants in Canada’s population would stand between 24.5% and 30.0% ….. These proportions would be the highest since 1871.”
Additionally, almost half of the population of Canada in 2036 is projected to be made up of immigrants and second-generation individuals.
By a second-generation individual is implied a non-immigrant that has at least one parent that had been born overseas.
The contribution of immigrants to the Canadian economy and society continues unabated. Moreover, the immigrants’ contribution is expected to increase further in the background of an aging population in Canada.
Immigration will remain a major contributor to the future demographic growth of Canada. According to Statistics Canada, “Starting in 2031, more than 80% of this growth is projected to come from immigration, compared to about 67% in 2011.”
Immigrants and newcomers have a significant role to play in sustaining the economic growth of Canada. Immigrants as well as temporary foreign workers fill gaps in the labour force in Canada, helping employers to respond to vacancies in different sectors.
As per a survey mentioned in Canadian Federation of Independent Business [CFIB] Report – Workers Without Borders Immigration Report – 9% of small business owners in Canada reported hiring temporary foreign workers for addressing job vacancies within the previous 1 year of participating in the survey.
As per the 2021-2023 Immigration Levels Plan announced on October 30, 2020, Canada will be welcoming 401,000 newcomers in 2021, followed by another 411,000 in 2022 and 421,000 in 2023.
In 2021, around 108,500 are to be granted permanent residence in Canada through the federal Express Entry system managed by Immigration, Refugees and Citizenship Canada [IRCC].
Another 80,800 are projected to acquire Canada PR in 2021 through the Provincial Nominee Program [PNP], commonly referred to as Canadian PNP.
There are 80 different immigration pathways or ‘streams’ under the PNP of Canada, many linked with IRCC Express Entry. A nomination – through any of the PNP streams linked with IRCC Express Entry – guarantees an invitation to apply by IRCC.
Applying for Canadian permanent residence through IRCC Express Entry is by invitation-only.
The higher the CRS score that you have, the brighter the chances of your being issued an ITA by IRCC. Here, by ‘CRS’ is implied the 1,200-point Comprehensive Ranking System [CRS] used for ranking profiles while in the IRCC pool of candidates.
A PNP nomination is worth 600 CRS points for an IRCC Express Entry candidate, thereby guaranteeing an invitation to apply for Canada PR.
The business sector in Canada employs over 12 million individuals. It is estimated that around 33% of all business owners in Canada are immigrants.
|Percentage of business owners who are immigrants by sector*|
|Sector||Percentage of immigrant owners|
|Computer systems design & services||51%|
|Data processing, hosting & services||40%|
* All statistics are from the Statistics Canada 2016 Census.
Entrepreneurs are an important part of the Canadian economy as a whole, and the business sector in Canada in particular. More than 2.7 million Canadians are self-employed.
As per official statistics, as of 2016, there were 600,000 self-employed immigrants in the country. These were employing 260,000+ Canadians.
In 2019, the labour market participation rates of very recent immigrants was 71%. That of recent immigrants, on the other hand, was 76%. While very recent immigrants are those that have landed in Canada within the recent 5 years or less, recent immigrants are those that have immigrated in the previous 5 to 10 years.
As per a Centre for the Study of Living Standards [CSLS] Report – The Improved Labour Market Performance of New Immigrants to Canada, 2006-2019 – “new immigrants are on average younger and better educated than the Canadian-born.” Consequently, the labour force participation and employment rates of immigrants were at par with the Canadian-born.
According to the Report, “Over the 2006 to 2019 period, very recent immigrants enjoyed an absolute and relative improvement in all four indicators.” These four labour market indicators are – participation, employment rates, unemployment, along with the average hourly wages earned by the immigrants.
The Report compares trends in labour market outcomes among very recent immigrants, recent immigrants, and workers that are Canadian-born.
Moreover, business owners that are immigrants have been found to be more open to innovation. According to a Research Paper – Innovation in Immigrant-owned Firms in Canada – released on June 9, 2020, “an immigrant-owned firm appears somewhat more likely to implement a product or process innovation”.
As per the Research Paper, this is regardless of whether the immigrant owner has recently landed in Canada or been in the country for a longer span of time. Moreover, the fact that the business is in a knowledge-based industry [KBI] in particular or the Canadian economy in general also has no bearing upon the findings.
Using data from a survey of Canadian firms in 2011, 2014 and 2017, the Research Paper asks as to whether small and medium-sized enterprises [SMEs] owned by immigrants were more likely to implement innovation as compared to those owned by the Canadian-born.
Generally, there is an increased likelihood of immigrant entrepreneurs being highly educated in a science, technology, engineering and mathematics [STEM] field. Such immigrant entrepreneurs have also been seen to be more likely to file patents. Factors that have a direct relation with innovation.
Ensuring that there is competition as well as consumer choice for products and services, entrepreneurs have a key role to play in the Canadian economy. Looking ahead, immigrant entrepreneurs and business leaders will have a significant contribution to make in the growth and success of the Canadian economy.
Key figures: Immigration Matters in Business*
|33% of all business owners in Canada are immigrants|
|600,000+ self-employed immigrants in Canada|
|260,000 of self-employed immigrants have paid employees|
|47,000+ immigrants in senior management roles|
* All statistics are from the Statistics Canada 2016 Census.
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