By Mata Press Service

Canada’s labour market is heading into a painful new phase as retirements rise, the younger workforce shrinks and Ottawa’s immigration cutbacks begin to bite into the country’s main source of labour force growth, a new RBC Economics report warns. The report, titled Canada’s looming labour squeeze: The impact of retirements and immigration policy, says Canada is entering a period of structural change that will outlast the current slowdown in hiring and could bring back labour shortages even while many young people and newcomers are still struggling to find stable work. RBC says monthly retirements have climbed to about 25,500 workers, almost double the roughly 14,000 a month recorded two decades ago. The pressure is expected to remain elevated into the 2030s as the last baby boomers reach 65 in 2029 and 70 in 2034. At the same time, Canada’s supply of younger workers is shrinking. According to RBC, the population under 35 fell by a record 120,500 from a year earlier in April, while the available workforce under 35 was down 76,000 despite a slight rise in labour force participation among younger people. Without immigration, RBC estimates Canada’s population aged 15 to 34 would fall by about 186,000 a year over the next five years. The pool of available workers under 35 would decline by about 139,000 annually, or roughly 11,600 people a month. That demographic reality lands at a politically difficult moment for Canada. After years of rapid population growth driven largely by international students, temporary workers and new permanent residents, Ottawa has moved to sharply reduce immigration targets in response to pressure on housing, health care, education and public services. The federal government’s current plan aims to reduce the temporary resident population to less than five per cent of Canada’s total population by the end of 2027. New temporary resident arrivals are targeted at 385,000 in 2026 and 370,000 in both 2027 and 2028. The 2026 target includes 155,000 new international student arrivals and 230,000 new temporary worker arrivals. Permanent resident admissions are set at 380,000 a year from 2026 to 2028. For many immigrant families, international students and temporary foreign workers, the shift has already created uncertainty. Work permits, study permits and post-graduation pathways have become more restricted, while employers in some sectors continue to warn that they cannot fill jobs.