Yahoo Finance Canada's population continues its strong growth despite signs of slowdown
The population growth rate continues to grow at a decent pace despite showing signs of a slowdown in the latest quarter, according to Statistics Canada data released Wednesday.
Canada is estimated to have added 250,229 people between April and July this year, which represents a quarterly growth rate of 0.6 per cent, the agency said. This is slower than the growth rate during the same quarters in 2023 and 2022, when the population grew by 334,606 and 253,510 people, respectively.
“This marked the first time since 2020 that quarterly growth has been slower than in the same quarter a year earlier,” Statistics Canada said on Wednesday. “In 2020, population growth was almost halted following border restrictions during the COVID-19 pandemic.”
But the 0.6 per cent growth rate in the second quarter is still higher than any other second quarter before 2022, the agency said.
As of July 1, 2024, the country’s population is estimated to have been 41.2 million. It increased by about 1.2 million and grew at a rate of around three per cent between July 1, 2023, and July 1, 2024.
Canada’s population growth relies on immigration, which also plays a key role in the country’s economic growth. But Ottawa plateaued its permanent residency targets and announced cuts to stem the rise of temporary residents in the past year as unemployment rates rose, especially among newcomers and the youth, and job vacancies declined.
In the latest quarter, there was a net increase of 117,836 temporary residents, which includes students, temporary foreign workers and asylum claimants, taking the total number of temporary residents past the three million mark as of July 2024.
“The rate (of growth of temporary residents) has been slowing since October 2023,” Statistics Canada said. “This lower rate of growth was mainly due to a decrease in the number of study permit holders during the second quarter of 2024.”
Despite the recent federal government announcements to limit the growth of temporary residents, economists say it will find it hard to meet its objective of reducing the proportion of non-permanent residents (NPRs) to five per cent of the overall population by 2026, from about 6.8 per cent now.
“The number of NPRs contributed significantly to population growth in all provinces,” Marc Desormeaux, a principal economist at the Toronto-Dominion Bank, said in a note on Wednesday. “To the extent that federal plans go ahead, there’s downside risk to Canada’s economy and public finances. The downside risk is most acute for Ontario and B.C., which are particularly reliant on NPRs.”
Population gains have helped the Canadian economy avoid a recession by increasing the overall economic output, but he said it is masking an “underlying economic weakness” since the gross domestic product per capita — an important measure of the country’s standard of living — has declined in seven of the past eight quarters.
“Today’s release doesn’t change our view that the Bank of Canada will reduce its policy interest rate by 50 basis points in October,” Desormeaux said. “A softening labour market, inflation hovering near its target and persistently falling output per person all suggest borrowing costs don’t need to be as restrictive as they are currently.”
Statistics Canada said Alberta was the fastest-growing province or territory during the quarter, primarily due to international and interprovincial migration. The slowest growth was in the Northwest Territories.
As a result of the rising population numbers, Canada’s median age decreased for the third year in a row, by 0.3 years to 40.3 years.
The number of Canadians aged zero to 14 years is increasing more slowly than the number of those aged 15 to 64 due to declining fertility rates, the agency said.
• Email: nkarim@postmedia.com
Bookmark our website and support our journalism: Don’t miss the business news you need to know — add financialpost.com to your bookmarks and sign up for our newsletters here.
