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Immigration Minister Sean Fraser attends a press conference on Oct. 7.PATRICK DOYLE/The Canadian Press

The federal government is increasing immigration targets for the next three years, aiming to admit almost 1.5 million new permanent residents to Canada by the end of 2025, in an effort to address significant labour shortages and an aging population while attracting newcomers to rural communities.

The numbers are in Ottawa’s annual immigration plan, which Immigration Minister Sean Fraser released on Tuesday. It says the government aims to add 465,000 permanent residents in 2023, 485,000 in 2024 and 500,000 in 2025. Last year, Canada admitted more than 405,000. Permanent residents can live and work in the country indefinitely and eventually apply for citizenship.

The plan calls for next year’s group of newcomers to include 266,210 economic immigrants, who are typically skilled workers. Among the rest would be 106,500 people coming to Canada to reunite with their families and 76,305 refugees and other protected people.

In an interview, Mr. Fraser said the government gave consideration to the fact that newcomers will be entering an already strained market for housing.

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“It’s not lost on me that there are housing pressures in Canada … but the reality is, the cost of not bringing in newcomers is enormous when you look at our economic and demographic challenges,” he said.

Mr. Fraser said the immigration plan focuses on settling new immigrants in different regions of the country, including small towns and rural communities. And he said changes to the government’s “express entry” system – which weighs different criteria to determine who is invited to apply for permanent residency as an economic immigrant – will allow the federal government to select newcomers based on what sector they work in and what part of the country they’re moving to.

He said the government intends to bring skilled workers to Canada – in particular, those who have the skills necessary to build housing for Canadians.

“By making sure we’re bringing in newcomers who can contribute to these kinds of social challenges that we’re facing and making sure that we’re bringing them to communities that have capacity, we can continue to welcome large numbers of newcomers without exacerbating challenges on our social systems, including housing,” he said.

The Trudeau government aims to add 465,000 permanent residents in 2023, 485,000 in 2024 and 500,000 in 2025.Andrew Vaughan/The Canadian Press

At a news conference earlier Tuesday, Mr. Fraser said the government will announce in March how many newcomers will be allocated to each province, and that Ottawa wants to ensure it is not allocating spaces to provinces that don’t have the capacity.

Mr. Fraser said Canada has experienced a strong economic recovery from the pandemic, but that life has become more expensive and businesses are having a hard time finding employees.

He said there is a need for more workers in every sector and in every region. He mentioned front-line health care workers, truck drivers and software engineers.

The Business Council of Canada said in a statement that it welcomes the government’s increased immigration goals but that “bolder targets” for admissions of economic immigrants are needed to tackle skill and labour shortages.

“Unfortunately, economic-class permanent residents represent only 58.5 per cent of total admissions in the plan announced today. This is far fewer than the number needed to support Canadians’ high standard of living,” said BCC president and chief executive Goldy Hyder.

Conservative immigration critic Tom Kmiec called the government’s record on immigration one of “failure, mismanagement, and backlogs that last for years.” Mr. Kmiec said those seeking to come to Canada deserve a clear plan, and a process that treats them with respect.

Jenny Kwan, the NDP immigration critic, said that, while her party welcomes the government’s plan, the Liberals have missed the mark on several key immigration streams. Ms. Kwan referenced the government’s failure to meet its commitment to bring Afghans who assisted with Canada’s military and diplomatic missions in Afghanistan, and their families, to Canada. The federal government has promised to bring 40,000 Afghans here.