Immigration not enough to save P.E.I. population

Immigration has kept P.E.I. the youngest province in Atlantic Canada over the last decade, but importing youth won't be enough to keep the provincial population sustainable into the future.

Like the rest of the Western world, P.E.I. is facing the problem of an aging population. This problem is made worse on P.E.I. because many young people are leaving, while at the same time older people are moving into the province.

• INTERACTIVE: Atlantic region aging faster than Canada
• INTERACTIVE: P.E.I. owes growth to immigration

Over the past decade, P.E.I. has lost more than 6,500 people aged under 45 to interprovincial migration. During that same period it has gained more 1,400 people who have passed their 45th birthday.

As a result the proportion of people aged 45 and older on the Island increased from 41.4 per cent in 2005 to 47.7 per cent in 2014.

Success at attracting immigrants

The Island's population would be much older today but for a plan, which was at the same time successful and controversial, that attracted thousands of immigrants in the last decade.

That early version immigrant investor program of the provincial nominee program, which ended in 2008, drew accusations of corruption for the way it was administered, but it also provided a huge boost to immigration. Just a few hundred immigrants a year were coming to the Island in the early years of the century, but it peaked at 2,609 in 2010-11. More than three quarters of those immigrants were younger than 45.

It is immigration that gave P.E.I. the highest population growth rate in Atlantic Canada in the last decade, and kept the province relatively young. It has also changed the face of the Island. As an ethnic group, the Chinese have catapulted from insignificant numbers to being the most prominent visible minority on the Island.

While the change is dramatic relative to what the Island is used to, Don Mills of the market research firm Corporate Research Associates argues the whole Atlantic region needs to be more accepting of immigration. He notes about five per cent of people living in Atlantic Canada were born in another country. The Canadian average is 22 per cent.

"We are the least diverse area of the country, and by a mile," said Mills.

"We need to be, first of all, willing and able to accept immigrants coming in from other countries, and be more welcoming than we currently are, and, number two, we need to have a strategy across this region to attract and retain these people."

Stopping the youth exodus

But all those youthful immigrants will do the province little good in the long term if the province does not find a way to provide economic opportunities for young people.

The unemployment rate for youth on the Island runs around 17 per cent. If that doesn't change, said Elizabeth Beale of the Atlantic Provinces Economic Council, the children of immigrants arriving on the Island today will be just as likely to leave as the children of people who were born here.

"The immigrants who are coming in may face, over their working life, exactly the same challenges that our own home-grown population will face in terms of the lack of job opportunities," said Beale.

Solving the problem will require more long-term thinking by both governments, which need to create incentives for employers to hire young people, and by private industries, which need to consider passing over the immediate benefits of hiring experienced people, for the long-term benefits of hiring new graduates.

"Many employers should be doing this because they have an older workforce," said Beale.

"They're going to be facing this challenge of how they move the firm along as those workers retire."

An unwieldy economy

Immigration has slowed the rate of aging of the P.E.I. population over the last five years, but it is still likely that 50 per cent of the population will be older than 45 by 2019.

The good news is that this means the unemployment rate is likely to fall dramatically over the next decade, as there will be fewer and fewer people in the workforce. The downside is that smaller workforce will be supporting a growing retired population.

"Unless we grow our population the tax burden on people living here is just going to be increasingly unwieldy and unacceptable," said Mills.

"The cost of taxation is going to be so high to be able to afford to keep paying the health bill for all these aging boomers. We're going to go from something like 3.9 workers for every retired person down to 2.5, for instance, in the next 10 years or so. Where does the money come from to pay for all these services?"

The numbers show change is already upon us. If some balance cannot be found in the population, and quickly, the province could find itself falling into a spiral it is difficult to get out of.