How Did We Get Here? Some Perspective from Prof Skuterud
“Nobody Likes a Cold Shower”: Economist Mikael Skuterud on How Canada Dismantled Its Skilled Immigration Advantage
Overview
In November 2024, economist Mikael Skuterud delivered opening remarks in a question-and-answer setting on the state of Canada’s immigration system. Professor Skuterud introduced himself as “a professor of economics at the University of Waterloo, the director of the Canadian Labour Economics Forum, and the Roger Phillips Scholar of Social Policy and Fellow and Residence at the C. D. Howe Institute.”
His opening statement was short and pointed. It combined three elements: a statement of methodological independence, a diagnosis of what has historically made Canadian immigration policy distinctive and politically durable, and a detailed account of advice given to the federal government more than a decade ago — advice he says was not followed.
For practitioners and applicants alike, the remarks matter because they trace current pressures in the system — on international students, on category-based selection under Express Entry, and on the credibility of the economic class — back to specific, identifiable policy choices rather than to immigration as such.
Independence Before Advocacy
Professor Skuterud opened by setting out the disclosure statement published on his website:
“As a researcher, I deliberately avoid advocacy, as I believe I can contribute more by seeking and disseminating objective evidence than in advancing agendas. For this reason, I have throughout my career declined funding from all organizations with explicit advocacy mandates or private interests.”
He also situated himself personally within the subject matter, noting that he comes to twenty years of research on the economics of Canadian immigration “as a Canadian immigrant who deeply values Canada’s exceptional record in combining high immigration levels with broad public support for immigration.”
Why Canada Was Exceptional
The core of the analysis was an explanation of Canadian “exceptionalism” — the unusual pairing of high intake with high public consent. In his telling, the explanation is structural, not cultural:
“It’s not complicated. Canada’s geography and non-tariff borders enables it to be highly selective in the immigrants it admits. Since 1967, we’ve relied on a point system that prioritizes skilled workers.”
The distributional consequence, he argued, is what sustains political support:
“The consequence is that the wage suppression effects of immigration are concentrated at the top end of the income distribution. So that immigration tends to, if anything, reduce, not exacerbate, economic inequality. In Canada, lower-income citizens don’t see immigrants as competition, but they see them instead as doctors and professors and scientists who make their lives better.”
That equilibrium, he said, has been eroded:
“But sadly, what we’ve seen in recent years is a dismantling of Canada’s skilled immigration system, as policymakers have become obsessed with plugging holes in lower-skilled labor markets.”
The 2016 Advice to Minister McCallum
The most concrete portion of the remarks was a chronology of a consultation that took place a decade ago.
“In March 2016, I received an email from Immigration Minister John McCallum requesting feedback on six policy questions. A group of nine academic economists met with the minister three weeks later to discuss his questions, and on May 10th, we sent him a 32-page written response.”
His assessment of what followed was blunt:
“I think it’s safe to say the feedback was never read by any of Mr. McCallum’s three successors.”
And his retrospective judgment:
“In re-evaluating this feedback, there’s little doubt in my mind that the mess the system finds itself in now could have been avoided if our recommendations had not been ignored.”
The three recommendations
- Against a low-skilled stream in Express Entry. “First, we advised against introducing a low-skilled component to the express entry system, which is precisely what category-based selection has done.”
- Caution on college-based study permit expansion. “Second, we warned the government to proceed carefully in expanding foreign student admissions in two-year college programs that are focused on selling immigration, not education.”
- Field of study and institution as CRS criteria. “Third, we recommended that the comprehensive ranking system for prioritizing economic class immigrants include as criteria both applicants’ field of study and the post-secondary institution from which they graduate.”
The International Education Strategy Shift
Professor Skuterud anticipated the objection that federal policy did not drive international student growth, and directed listeners to the documentary record:
“To anyone who believes federal government policy is not responsible for the explosive growth in foreign student admissions that we’ve seen, I recommend them reading the federal government’s 2014 and 2019 international education strategy reports.”
He characterized the change between the two documents as unmistakable:
“What you’ll see is an unambiguous shift in focus from attracting and retaining the quote best and brightest to quote diversifying foreign students’ fields, levels, and locations of study.”
And he identified where the growth capacity was understood to lie:
“By 2019, there was a recognition that the potential to scale up foreign student entries and, in turn, immigration levels lay in the colleges who were struggling to fill their seats with domestic students. The system became fixated with growth and quantity and lost sight of the consequences for quality and our skilled immigration system.”
The Growth Narrative
He closed by challenging the economic case that accompanied a decade of expanded intake:
“For the past decade, Canadian voters have been told by their federal government that significant increases in immigration levels would be tonic for Canada’s sluggish economic growth. For academic economists who study immigration and understand how economies work, this narrative might have felt good, but it wasn’t true. We warned the government, but nobody likes a cold shower, and we were ignored. We are seeing the consequences now.”
Conclusion
Professor Skuterud’s statement in 2024 underscore a key argument about the importance of selectivity in our immigration system. His position is not that immigration levels are inherently too high, nor that newcomers are responsible for labour market strain. It is that Canada’s historical consensus rested on a selection architecture — a point system oriented to skilled workers since 1967 — which placed competitive pressure at the top of the income distribution rather than the bottom, and that this architecture has been progressively compromised by category-based selection, by the use of two-year college programs as an immigration channel, and by a comprehensive ranking system that does not account for field of study or institutional quality.
The 2016 episode he recounts — an email in March, a meeting three weeks later, a 32-page submission dated May 10 — is offered as evidence that these outcomes were foreseeable and foreseen. His reading of the 2014 and 2019 international education strategies frames the growth in study permits as a deliberate federal choice, not an unintended byproduct.
For clients and counsel, the practical takeaway is that the policy conversation can only move towards selectivity: tighter alignment between credentials and labour market need, closer scrutiny of educational institutions, and renewed emphasis on skill level in economic-class ranking. Those contemplating a pathway through study or lower-skilled work should anticipate that the criteria which governed their decision at the outset may not be the criteria that govern the outcome. Early, individualized legal advice remains the most reliable protection against that volatility.