In response to the significant amount of immigration that took place there, Canada has issued a new statement.
Canada issues a new statement regarding the high levels of immigration to it
According to research, Canada's high immigration rate is causing the country's per-capita GDP to decrease.
A decrease in Canada's GDP has occurred. Additionally, a recent analysis suggests that it might be partially due to the high levels of immigration.
The data reveals that the gross domestic product (GDP) per capita of Canada experienced a decrease of 4.4% during the third quarter.
According to new research from National Bank Financial, the economy of Canada saw a decline that was "unprecedented outside of a recession." An increase in population that has slowed per capita GDP growth is at least one factor in this trend.
Additionally, according to the bank's monthly economic review, "signs of an economic slowdown have been multiplying."
According to the research, "consumption remained unchanged for the second consecutive quarter, which is a stinging setback in the current demographic context that is characterized by record population increases."
The revised gross domestic product (GDP) per capita, which the bank's economists had estimated had decreased by 2.4% during the third quarter, is now said to have decreased by 4.4% during that same period, according to the bank's experts.
New statement on rising levels of immigration to Canada
According to Mikel Skuterud, an economist at the University of Waterloo, the easiest way to comprehend it is to visualize the gross domestic product (GDP) as a pie that is divided by the population.
The per capita GDP is the portion of the pie that, in theory, each and every Canadian receives. Therefore, according to the idea, the size of the slice that is taken from the same pie will decrease if there are more people eating portions of the same pie.
"I think you'd be hard-pressed to find any economist in Canada who doesn't believe that the exceptionally high population growth rates we're experiencing now have contributed to that decline in GDP per capita that we're seeing," Skuterud said. "I find it hard to believe that any economist in Canada would disagree with this statement."
Nevertheless, it is not as straightforward as that. The Gross Domestic Product (GDP) will increase if, for instance, any member of the newly formed population ends up contributing to the GDP.
Skuterud stated that even if the population of Canada did not increase, "I do not believe that we would be seeing strong growth and GDP per capita because there are other things happening right now in the economy."
