Back in 2009, Australia’s then-prime minister sparked a national debate over immigration by declaring himself in favour of a 60-per-cent increase in the country’s population by 2050, despite concerns raised within his own Labor government about the sustainability of such a policy.
“I actually believe in a big Australia. I make no apology for that,” Kevin Rudd said at the time. “I actually think it’s good news that our population is growing … It’s good for our national security long term. It’s good in terms of what we can sustain as a nation.”
Within months, Mr. Rudd had resigned after a Labor coup. But the term Big Australia nevertheless entered the political lexicon as shorthand for an expansive immigration policy aimed at turbocharging the country’s long-term economic growth and geopolitical clout.
Big Australia proponents advanced the same arguments as Canada’s Century Initiative, created in 2009 to advocate for a threefold increase in this country’s population to 100 million by 2100.
Flash forward to 2024, and the Big Australia movement finds itself on the defensive as the country grapples with a housing shortage and affordability crisis amid record levels of immigration. A post-pandemic surge in temporary foreign workers and international students drove net migration to 518,000 in the 2022-23 fiscal year that ended last June, more than double the net total of newcomers who arrived in 2019.
In December, the current Labor government headed by Prime Minister Anthony Albanese slammed on the brakes. It unveiled a plan to “reform Australia’s broken migration system” and “bring migration back to sustainable levels.” Net migration will be reduced to 375,000 this year and to 250,000 in 2024-25.
“People my age in my city and anyone younger right now think that owning their own home is a pipe dream. They can’t get into a rental,” said Clare O’Neil, Australia’s 43-year-old Home Affairs Minister and a Melbourne MP. “[W]e’ve got a housing crisis in our country that is not being helped by what is a very large migration intake.”
While Australia’s centre-left federal government has finally moved – however reluctantly – to fix a “broken” immigration system, Canada’s is still in denial. Liberal Immigration Minister Marc Miller last month announced a 35-per-cent reduction in student visas this year. But that timid move was typical of a government that still refuses to admit its immigration-policy mistakes.
Mr. Miller has not taken any action to reduce the number of temporary foreign worker visas Ottawa hands out. Prime Minister Justin Trudeau has insisted his government has no intention of scrapping its plan to increase the number of new permanent residents Canada accepts to 500,000 in 2025, from 485,000 this year, 341,000 in 2019 and 272,000 in 2015.
In short, the Liberals still seem wedded to Big Canada, despite its increasingly obvious pitfalls.
After driving up housing costs and rents, the perverse effects of the Liberals’ immigration policies are weighing on the labour market, as population growth far outpaces job growth. Statistics Canada last week reported that in January, the working-age population increased by 3.1 per cent, or more than a million people, year over year. But overall employment increased by only 345,000, or 1.7 per cent, over the same period. The result is that Canada’s employment rate – the proportion of the population with a job – fell by 0.8 percentage points to 61.6 per cent. In Ontario, the employment rate plunged 1.4 percentage points to 60.8 per cent.
While increasing slack in the labour market could help the Bank of Canada move closer to its 2-per-cent inflation target, the country’s declining employment rate nevertheless is yet another sign that the country’s economy is struggling to integrate the thousands of newcomers it continues to take in each month. In January alone, the country added 126,000 new residents, with the Greater Toronto Area accounting for more than a quarter of the total.
“With the current interest rate structure, it is simply impossible for the labour market to absorb such a large number of newcomers,” National Bank chief economist Stéfane Marion wrote this week. “A deteriorating labour market amid a population boom will continue to stress the infrastructure and finances of Canada’s largest metropolitan area for the foreseeable future.”
Mr. Marion last month warned that excessively high immigration levels are causing Canada to fall into a “population trap,” as new capital investments in infrastructure and housing fail to keep pace with population growth, driving down living standards. He is now calling on Ottawa to create “a non-partisan council of experts” to determine immigration targets that are better in line with the economy’s ability to absorb newcomers. Such a move would serve to depoliticize Canada’s emerging immigration debate and inject much-needed rigour into policymaking.
Big is not always better. In Canada’s case, it is turning out to be much worse.