The federal government plans to bring in a new immigration program that will allow cities and towns to pick newcomers based on local labour needs.

The Liberals promised to create a municipal nominee program during the election campaign. Prime Minister Justin Trudeau instructed new Immigration Minister Marco Mendicino to begin work on the project in his recent mandate letter.

The plan is to give local communities, chambers of commerce and labour councils a say in the selection of immigrants, helping them match newcomers with labour needs in various communities. At least 5,000 new spaces will be created for the program, according to the mandate letter.

Mendicino said this new pathway to permanent residency is another example of innovation in Canada's immigration programs, one that allows the system "to draw on local experiences, expertise, capacities to understand where are the labour shortages, where are the economic opportunities and how that information can help us select individuals who wish to come to Canada to ply their trade, to fulfil their opportunity."

Immigration Minister Marco Mendicino will oversee the government's plan to bring in 1 million immigrants over the next three years. (Justin Tang/Canadian Press)

According to data provided by Immigration, Refugees and Citizenship Canada (IRCC), the worker-to-retiree ratio in Canada is now 4:1, but is projected to fall to 2:1 in 2035.

Over the last decade, 75 per cent of Canada's population growth has come from immigration, and by 2031, immigration is expected to account for 80 per cent of Canada's population growth, says IRCC.

The government already has a provincial nominee program to attract people with specific skills, education or work experience that could contribute to the economy of a specific region.

Other pilot programs have targeted newcomers to fill jobs in Atlantic Canada and in rural and remote communities.

Leah Nord, director of workforce strategies and inclusive growth for the Canadian Chamber of Commerce, said labour gaps persist across the country and nearly half a million jobs are going unfilled in many sectors.

'The way to go'

She said she welcomes the proposed municipal nominee program, adding that "devolving" the decision-making process to those who best understand local needs is "definitely the way to go."

Under the federal program, a high number of immigrants wind up in the country's biggest cities such as Toronto, Montreal, Vancouver, Ottawa and Halifax.

This program would help attract and retain skilled workers in smaller and mid-sized communities by aligning immigration intake with the job skills the local community needs, Nord said.

"One of the greatest ways to ensure immigration integration is a success is to have a job, to have labour market integration," she said. "And that comes from the employer, from the chambers, from the business point of view. Having them involved in the beginning and making them those liaisons is key to success."

Nord said she expects that under the new program, many newcomers will arrive with job offers already in hand, freeing them up to set down roots in the community and "hit the ground running."

Aging population

Pedro Antunes, chief economist for The Conference Board of Canada, said a municipal nominee program will allow communities to micro-target immigrants in sectors like construction or resource development.

At a time of aging demographics and declining fertility, he said, immigrants are crucial to Canada's labour market.

"The economic migrants play a big, big role ... in helping us grow our workforce at a time when, if not for immigration, we'd actually be seeing a decline in the number of workers in Canada," he said.

A May 2019 report from the Conference Board said that by 2030, more than nine million baby boomers will reach retirement age.

Between 2018 and 2040, nearly 12 million people are expected to leave Canadian schools and become workers — far short of the 13.4 million workers leaving the workforce.

Immigration is 'formative solution'

The report says immigration will remain a "formative solution" and account for all of Canada's net labour force growth.

Mendicino's mandate letter also tasks him with implementing Canada's immigration levels plan to bring a million new permanent residents to Canada over a three-year period.

"This continues our modest and responsible increases to immigration, with a focus on welcoming highly skilled people who can help build a stronger Canada," his mandate letter reads.

Mendicino is also responsible for working with the provinces and territories to deliver high-quality settlement services to ensure the successful integration of new Canadians, and to measure outcomes with data collection.