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Canada housing crisis: Feds stick by immigration plan

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OTTAWA –

The alarm bells are becoming bull horns: Canada’s housing supply isn’t keeping up with the rapid rate of population growth.

Academics, commercial banks and policy thinkers have all been warning the federal government that the pace of population growth, facilitated by immigration, is making the housing crisis worse.

“The primary cause for (the) housing affordability challenge in Canada is our inability to build more housing that is in line with the increase in population,” said Murtaza Haider, a professor of data science and real estate management at Toronto Metropolitan University.

A TD report released in late July also warned that “continuing with a high-growth immigration strategy could widen the housing shortfall by about a half-million units within just two years.”

But the Liberals are doubling down on their commitment to bring more people into the country, arguing that Canada needs high immigration to support the economy and build the homes it desperately needs.

“Looking at the (immigration) levels that we have recently approved as a cabinet (and) as a government, we can’t afford currently to reduce those numbers,” Immigration Minister Marc Miller said in an interview with The Canadian Press.

That’s because Canada’s aging population risks straining public finances, he said, as health-care needs rise and the tax base shrinks.

A report by Statistics Canada published in April 2022 finds the country’s working population has never been older, with more than one in five people close to retirement.

At the same time, Canada’s fertility rate hit a record low of 1.4 children per woman in 2020.

The TD report, co-authored by the commercial bank’s chief economist Beata Caranci, notes that economists are the ones who have been warning of the economic consequences of Canada’s aging population.

“A ramp-up in skilled-based immigration offered a solution. Government policies have delivered, but now the question is whether the sudden swing in population has gone too far, too fast,” the report said.

The federal government’s latest immigration levels plan, released last fall, would see Canada welcome 500,000 immigrants annually by 2025.

In contrast, the immigration target for 2015 was under 300,000.

Although the half-million figure has caught considerable attention, it’s not just higher immigration targets that are driving the surge in population.

Canada is also experiencing a boom in the number of temporary residents who are coming to the country, which includes international students and temporary foreign workers.

In 2022, Canada’s population grew by more than one million people, a number that included 607,782 non-permanent residents and 437,180 immigrants.

Miller said in the interview that the federal government is open to reconsidering international student enrolments, particularly amid fraud concerns.

Earlier this year, hundreds of people were suspected of being caught in a fraud scheme that saw immigration agents issue fake acceptance letters to get students into Canada.

“There is fraud across the system that we are going to have to clamp down on,” Miller said.

The increased scrutiny of Canada’s immigration policies and population growth comes as the country faces a housing affordability crisis caused in large part by a shortage of homes.

Most experts agree that the root causes of this housing shortage are unrelated to immigration. Red tape and anti-development sentiment at the municipal level, for example, can lead to major delays in projects.

Federal tax incentives that helped spur purpose-built rental constructions were rolled back decades ago, leading to a massive shortage in rentals that has slowly built up over time.

Given these existing challenges, experts are concerned strong population growth will add fuel to the fire.

BMO published an analysis in May that estimated that for every one per cent of population growth, housing prices rise by three per cent.

The rebound of the Canadian real estate market this year also shows how immigration is helping to maintain demand for housing, despite decades-high interest rates.

“Strong population growth from immigration is adding both demand and supply to the economy: newcomers are helping to ease the shortage of workers while also boosting consumer spending and adding to demand for housing,” the central bank said after raising rates again in July.

Mike Moffatt, a housing expert and economist, said the federal government doesn’t necessarily need to change its immigration targets.

“But it does mean that they’re going to have to get very bold on housing,” said Moffatt, an assistant professor at the Ivey Business School at Western University in London, Ont.

For the federal Liberals, the relationship between population growth and housing prices jeopardizes public support for its immigration policies.

David Coletto, the CEO of Abacus Data, said polling shows Canadians are concerned about the impact immigration is having on the housing market.

“There’s a belief, anyways, that on the one hand, immigration is needed because we’re an aging population, because … we need people to do certain types of work that we don’t have sort of the domestic capacity for,” Coletto said.

“They also see the downside, which is putting further pressure on the housing market and pressure on health care.”

Miller said the federal government needs to carefully examine reports on housing and population growth, but he also raised concerns that some of the critiques are motivated by bigotry.

“The wave of populist, opportunist sentiment that does at times want to put all of society’s woes on the backs of immigrants — I think we need to call that out when we see it,” he said.

Immigration is also part of the solution to the housing crunch, Miller added. Construction is one of the industries where the labour shortage is most critical, and Miller argued that the people who are coming in can help build the new homes that are required to alleviate the crisis.

The federal government recently announced changes to the express entry system that would prioritize tradespeople for permanent residency.

Housing Minister Sean Fraser, who held the immigration portfolio before this summer’s cabinet shuffle, said the government is aware of the need to better align its housing and immigration policies.

“The things that we were working towards, that I expect will continue to be advanced under Mr. Miller’s watch, is the need to better tie our immigration policies to our housing and infrastructure strategies,” Fraser said in an interview.

“It certainly does require some deep thinking to figure out how and where we’re going to build the homes and grow the communities in a way that will mirror where people are moving to.”

This report by The Canadian Press was first published Aug. 16, 2023.

 

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Looking for the next mystery bestseller? This crime bookstore can solve the case

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WINNIPEG – Some 250 coloured tacks pepper a large-scale world map among bookshelves at Whodunit Mystery Bookstore.

Estonia, Finland, Japan and even Fenwick, Ont., have pins representing places outside Winnipeg where someone has ordered a page-turner from the independent bookstore that specializes in mystery and crime fiction novels.

For 30 years, the store has been offering fans of Agatha Christie’s Hercule Poirot or Arthur Conan Doyle’s Sherlock Holmes a place to get lost in whodunits both old and new.

Jack and Wendy Bumsted bought the shop in the Crescentwood neighbourhood in 2007 from another pair of mystery lovers.

The married couple had been longtime customers of the store. Wendy Bumsted grew up reading Perry Mason novels while her husband was a historian with vast knowledge of the crime fiction genre.

At the time, Jack Bumsted was retiring from teaching at the University of Manitoba when he was looking for his next venture.

“The bookstore came up and we bought it, I think, within a week,” Wendy Bumsted said in an interview.

“It never didn’t seem like a good idea.”

In the years since the Bumsteds took ownership, the family has witnessed the decline in mail-order books, the introduction of online retailers, a relocation to a new space next to the original, a pandemic and the death of beloved co-owner Jack Bumsted in 2020.

But with all the changes that come with owning a small business, customers continue to trust their next mystery fix will come from one of the shelves at Whodunit.

Many still request to be called about books from specific authors, or want to be notified if a new book follows their favourite format. Some arrive at the shop like clockwork each week hoping to get suggestions from Wendy Bumsted or her son on the next big hit.

“She has really excellent instincts on what we should be getting and what we should be promoting,” Micheal Bumsted said of his mother.

Wendy Bumsted suggested the store stock “Thursday Murder Club,” the debut novel from British television host Richard Osman, before it became a bestseller. They ordered more copies than other bookstores in Canada knowing it had the potential to be a hit, said Michael Bumsted.

The store houses more than 18,000 new and used novels. That’s not including the boxes of books that sit in Wendy Bumsted’s tiny office, or the packages that take up space on some of the only available seating there, waiting to be added to the inventory.

Just as the genre has evolved, so has the Bumsteds’ willingness to welcome other subjects on their shelves — despite some pushback from loyal customers and initially the Bumsted patriarch.

For years, Jack Bumsted refused to sell anything outside the crime fiction genre, including his own published books. Instead, he would send potential buyers to another store, but would offer to sign the books if they came back with them.

Wendy Bumsted said that eventually changed in his later years.

Now, about 15 per cent of the store’s stock is of other genres, such as romance or children’s books.

The COVID-19 pandemic forced them to look at expanding their selection, as some customers turned to buying books through the store’s website, which is set up to allow purchasers to get anything from the publishers the Bumsteds have contracts with.

In 2019, the store sold fewer than 100 books online. That number jumped to more than 3,000 in 2020, as retailers had to deal with pandemic lockdowns.

After years of running a successful mail-order business, the store was able to quickly adapt when it had to temporarily shut its doors, said Michael Bumsted.

“We were not a store…that had to figure out how to get books to people when they weren’t here.”

He added being a community bookstore with a niche has helped the family stay in business when other retailers have struggled. Part of that has included building lasting relationships.

“Some people have put it in their wills that their books will come to us,” said Wendy Bumsted.

Some of those collections have included tips on traveling through Asia in the early 2000s or the history of Australian cricket.

Micheal Bumsted said they’ve had to learn to be patient with selling some of these more obscure titles, but eventually the time comes for them to find a new home.

“One of the great things about physical books is that they can be there for you when you are ready for them.”

This report by The Canadian Press was first published on Sept. 15, 2024.



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Labour Minister praises Air Canada, pilots union for avoiding disruptive strike

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MONTREAL – Canada’s labour minister is praising both Air Canada and the union representing about 5,200 of its pilots for averting a work stoppage that would have disrupted travel for hundreds of thousands of passengers.

Steven MacKinnon’s comments came in a statement shared to social media shortly after Canada’s largest air carrier announced it had reached a tentative labour deal with the Air Line Pilots Association.

MacKinnon thanked both sides and federal mediators, saying the airline and its pilots approached negotiations with “seriousness and a resolve to get a deal.”

The tentative agreement averts a strike or lockout that could have begun as early as Wednesday for Air Canada and Air Canada Rouge, with flight cancellations expected before then.

The airline now says flights will continue as normal while union members vote on the tentative four-year contract.

Air Canada had called on the federal government to intervene in the dispute, but Prime Minister Justin Trudeau said Friday that would only happen if it became clear no negotiated agreement was possible.

This report from The Canadian Press was first published Sept. 15, 2024.

Companies in this story: (TSX:AC)

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As plant-based milk becomes more popular, brands look for new ways to compete

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When it comes to plant-based alternatives, Canadians have never had so many options — and nowhere is that choice more abundantly clear than in the milk section of the dairy aisle.

To meet growing demand, companies are investing in new products and technology to keep up with consumer tastes and differentiate themselves from all the other players on the shelf.

“The product mix has just expanded so fast,” said Liza Amlani, co-founder of the Retail Strategy Group.

She said younger generations in particular are driving growth in the plant-based market as they are consuming less dairy and meat.

Commercial sales of dairy milk have been weakening for years, according to research firm Mintel, likely in part because of the rise of plant-based alternatives — even though many Canadians still drink dairy.

The No. 1 reason people opt for plant-based milk is because they see it as healthier than dairy, said Joel Gregoire, Mintel’s associate director for food and drink.

“Plant-based milk, the one thing about it — it’s not new. It’s been around for quite some time. It’s pretty established,” said Gregoire.

Because of that, it serves as an “entry point” for many consumers interested in plant-based alternatives to animal products, he said.

Plant-based milk consumption is expected to continue growing in the coming years, according to Mintel research, with more options available than ever and more consumers opting for a diet that includes both dairy and non-dairy milk.

A 2023 report by Ernst & Young for Protein Industries Canada projected that the plant-based dairy market will reach US$51.3 billion in 2035, at a compound annual growth rate of 9.5 per cent.

Because of this growth opportunity, even well-established dairy or plant-based companies are stepping up their game.

It’s been more than three decades since Saint-Hyacinthe, Que.-based Natura first launched a line of soy beverages. Over the years, the company has rolled out new products to meet rising demand, and earlier this year launched a line of oat beverages that it says are the only ones with a stamp of approval from Celiac Canada.

Competition is tough, said owner and founder Nick Feldman — especially from large American brands, which have the money to ensure their products hit shelves across the country.

Natura has kept growing, though, with a focus on using organic ingredients and localized production from raw materials.

“We’re maybe not appealing to the mass market, but we’re appealing to the natural consumer, to the organic consumer,” Feldman said.

Amlani said brands are increasingly advertising the simplicity of their ingredient lists. She’s also noticing more companies offering different kinds of products, such as coffee creamers.

Companies are also looking to stand out through eye-catching packaging and marketing, added Amlani, and by competing on price.

Besides all the companies competing for shelf space, there are many different kinds of plant-based milk consumers can choose from, such as almond, soy, oat, rice, hazelnut, macadamia, pea, coconut and hemp.

However, one alternative in particular has enjoyed a recent, rapid ascendance in popularity.

“I would say oat is the big up-and-coming product,” said Feldman.

Mintel’s report found the share of Canadians who say they buy oat milk has quadrupled between 2019 and 2023 (though almond is still the most popular).

“There seems to be a very nice marriage of coffee and oat milk,” said Feldman. “The flavour combination is excellent, better than any other non-dairy alternative.”

The beverage’s surge in popularity in cafés is a big part of why it’s ascending so quickly, said Gregoire — its texture and ability to froth makes it a good alternative for lattes and cappuccinos.

It’s also a good example of companies making a strong “use case” for yet another new entrant in a competitive market, he said.

Amid the long-standing brands and new entrants, there’s another — perhaps unexpected — group of players that has been increasingly investing in plant-based milk alternatives: dairy companies.

For example, Danone has owned the Silk and So Delicious brands since an acquisition in 2014, and long-standing U.S. dairy company HP Hood LLC launched Planet Oat in 2018.

Lactalis Canada also recently converted its facility in Sudbury, Ont., to manufacture its new plant-based Enjoy! brand, with beverages made from oats, almonds and hazelnuts.

“As an organization, we obviously follow consumer trends, and have seen the amount of interest in plant-based products, particularly fluid beverages,” said Mark Taylor, president and CEO of Lactalis Canada, whose parent company Lactalis is the largest dairy products company in the world.

The facility was a milk processing plant for six decades, until Lactalis Canada began renovating it in 2022. It now manufactures not only the new brand, but also the company’s existing Sensational Soy brand, and is the company’s first dedicated plant-based facility.

“We’re predominantly a dairy company, and we’ll always predominantly be a dairy company, but we see these products as complementary,” said Taylor.

It makes sense that major dairy companies want to get in on plant-based milk, said Gregoire. The dairy business is large — a “cash cow,” if you will — but not really growing, while plant-based products are seeing a boom.

“If I’m looking for avenues of growth, I don’t want to be left behind,” he said.

Gregoire said there’s a potential for consumers to get confused with so many options, which is why it’s so important for brands to find a way to differentiate themselves, whether it’s with taste, health, or how well the drink froths for a latte.

Competition in a more crowded market is challenging, but Taylor believes it results in better products for consumers.

“It keeps you sharp, and it forces you to be really good at what you’re doing. It drives innovation,” he said.

This report by The Canadian Press was first published Sept. 15, 2024.



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