Alberta's economy will recover when immigration returns to normal
Immigration minister believes immigrants will save the economy. The recovery of the oil and gas sector depends on foreign specialists.
The pandemic has hit Alberta, with more new cases of COVID-19 infection in a day there than in the rest of Canada in 2020. This has led to blockages and restrictions on entry that have hurt its economy and restricted immigration.
Alberta lost 7.3% of real GDP in 2020 and experienced a 47.5% decline in new permanent residents compared to 2019. Only 20,755 new permanent Canadian residents settled in Alberta in 2020. In 2019, there were 43,690.
TD Economics released its annual provincial outlook for 2021. In it, the bank noted that restrictions on housing, food and household services have set back Alberta's economy.
Bank Chief Economist Beata Caranchi, Deputy Chief Economist Derek Burlton, and economists Rishi Sondhi and Omar Abdelrahman have suggested in a forecast under the grim heading "The night is darkest before the dawn" that Alberta will see the sharpest population decline among provinces in 2020.
TD Economics expects that to change this year. In their forecast, economists predict Alberta's real GDP growth of 4.8% in 2021 as the oil and gas sector recovers from a steep price drop in 2020.
Immigration takes its toll
Data from Immigration, Citizenship and Refugee Canada (IRCC) for the past 2020 shows that business immigration programs in Alberta have been hit the hardest by COVID-19.
The number of new permanent residents in Alberta's business immigration programs decreased by 63.2%, from 95 in 2020 to 35 in 2021.
The other programs also suffered pandemic losses but only a 40.3% decline. Overall, Alberta's provincial program did better than all other provincial immigration programs.
For example, the number of new residents in skilled trades and skilled worker programs decreased by 52%, to 4,520.
Ottawa intends to increase the flow of immigrants and has set a high target for the next three years.
Immigration Minister Marco Mendicino announced in late 2020 that Canada was going to significantly increase immigration to make up for the shortfall that the COVID-19 pandemic has created.
"Immigration is necessary to survive the pandemic, as well as for short-term economic recovery and long-term economic growth," Mendicino said. — Our plan will help address the most pressing labour shortages and increase the population to keep Canada competitive on the global stage."
Under the new plan, Canada plans to welcome more than 1.2 million new residents between 2021 and 2023.
