Canada: Immigrants account for 33% of all business owners

Immigrants account for 33% of all business owners

According to Canadian Statistics, “By 2036, the immigrant’s share in Canada’s population might increase to 24.5% to 30.0% or above. These proportions would be recorded as the highest since 1871.”

As per the statistics, most of Canada’s population will be filled up with immigrants by 2036. This is because many of them are accounted to be immigrants and second-generation individuals. The second-generation individual is implied as a non-immigrant with at least one parent born overseas.

The number of immigrants contributing to the Canadian economy and society remains unabated. Apart from this, their contribution is predicted to hike because of the retiring population in Canada. Hence IRCC is concentrating on immigration, which is considered an essential demographic growth factor 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.”

To maintain these, it has more than 60 economic immigration pathways allowing many foreign nationals to enter the country along with PRs. The country also invests around one million dollars only for the settlement of the newcomers.

Permanent Status – Canadian Immigration Categories

The popular immigration programs to Canada are listed below:

All these policies are playing a massive role in maintaining Canada’s economic growth, even though it is hit hard by the effect of a pandemic. Immigrants and newcomers play a significant role in filling the gaps in Canada’s labor market needs, supporting employers by filling the vacancies in different sectors.

According to the survey by the Canadian Federation of Independent Business (CFIB) Report Workers Without Borders Immigration Report – 9%, small business owners in Canada reported hiring temporary foreign workers to address job vacancies within the previous year of participating in the survey.

2021-2023 Immigration Levels Plan

IRCC announced the 2021-2023 Immigration Levels Plan on October 30, 2020. According to these immigration plans, the country welcomed 401,000 newcomers in 2021, followed by another 411,000 in 2022 and 421,000 in 2023.

Permanent residence in Canada

Immigration, Refugees, and Citizenship Canada (IRCC) have to grant around 108,500 permanent residence in Canada through the federal Express Entry system. Along with this, approximately 80,800 are projected to acquire Canada PR in 2021 through the Provincial Nominee Program (PNP), commonly referred to as Canadian PNP.

Various Immigration Pathways to Canada

There are more than 80 different immigration pathways or ‘streams’ under the PNP of Canada, many linked with IRCC Express Entry. A nomination – through any PNP streams related to 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 you have, the brighter the chances of you 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.
  • Other Canada immigration pathways for a skilled worker include – the Rural and Northern Immigration Pilot (RNIP) and the Atlantic Immigration Pilot Program (AIP).
  • Canada has a high demand for immigrants in the healthcare sector.

Entrepreneurship stream in Canada

The business sector in Canada is estimated to employ over 12 million individuals. It is estimated that around 33% of all business owners in Canada are immigrants.

Sector Percentage of immigrant owners
Transportation 56%
Retail stores 53%
Information and Technology 51%
Restaurants 50%
Data services 40%
Healthcare 36%
Software 30%

Entrepreneurs have become an integral part of the Canadian economy 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, very recent immigrants’ labor market participation rate 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 five 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 Labor Market Performance of New Immigrants to Canada, 2006-2019 – “new immigrants are on average younger and better educated than the Canadian-born.” Consequently, immigrants’ labor force participation and employment rates 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 labor market indicators are – participation, employment rates, unemployment, and the average hourly wages earned by the immigrants.

The report compares trends in labor 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 on the findings.

Using data from a survey of Canadian firms in 2011, 2014, and 2017, the Research Paper asks whether small and medium-sized enterprises (SMEs) owned by immigrants were more likely to implement innovation than those owned by the Canadian-born.

Factors that have a direct relation with innovation. Generally, there is an increased likelihood of immigrant entrepreneurs being highly educated in science, technology, engineering, and mathematics (STEM) field. Such immigrant entrepreneurs have also been seen to be more likely to file patents.

To ensure that there is competition and consumer choice for products and services, entrepreneurs have a key role in the Canadian economy. Looking ahead, immigrant entrepreneurs and business leaders will have a significant contribution to the growth and success of the Canadian economy.

Population type Number or percentage
Business owners in Canada are immigrants 33%
Self-employed immigrants in Canada 600,000+
Paid employees 260,000
Immigrants in senior management roles 47,000+

* All statistics given in this article are from the Statistics Canada 2016 Census.

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