The demographic landscape of Canada is undergoing a historic transformation, with South Asian populations poised to become the most significant driver of the nation’s labour force growth over the next two decades. As we approach 2026, new data reveals that the South Asian community in Canada has not only quadrupled in size since 1996 but is also projected to constitute up to 12.5% of the total Canadian population by 2041. This shift is reshaping the economic fabric of the country, influencing everything from federal immigration category selection to urban planning and labour market strategies. For policymakers and prospective immigrants alike, understanding these trends is crucial for navigating the future of work in Canada.
A Historic Demographic Shift
The growth of the South Asian population in Canada is nothing short of remarkable. According to the latest “Portrait of the South Asian populations in Canada” released by Statistics Canada, the community has grown from approximately 669,000 individuals in 1996 to nearly 2.6 million in 2021. This represents a surge from 2.4% to 7.1% of the total Canadian population in just 25 years.
Looking forward, the trajectory remains steep. Official population projections indicate that by 2041, the South Asian population could range between 4.7 million and 6.5 million people. This demographic expansion is driven largely by sustained immigration, which is expected to remain the primary source of Canada’s population growth through 2026 and beyond. As the indigenous-born workforce ages, Canada is increasingly relying on this youthful, highly educated immigrant cohort to fill critical gaps in the labour market.
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Diversity of Origins: Beyond a Single Identity
While frequently grouped under a single label, the South Asian population in Canada is characterized by immense diversity in origin, culture, and language. The 2021 Census data highlights that while India remains the primary country of birth (accounting for 44% of South Asians in Canada), there are significant populations from Pakistan (9%), Sri Lanka (5%), and Bangladesh (3%).
Moreover, the community is not limited to those arriving directly from South Asia. A notable portion of South Asians immigrate to Canada from other regions, including the Caribbean (such as Guyana and Trinidad and Tobago), Africa (Tanzania, Kenya, Uganda), and the Middle East. Additionally, the second-generation cohort is expanding rapidly; in 2021, nearly 29% of South Asians were born in Canada. This growing segment of Canadian-born South Asians is bridging cultural divides and is expected to play a pivotal leadership role in the political and corporate sectors by 2026.
The Dominance of Economic Immigration Categories
The driving force behind this population boom is Canada’s economic immigration system. Historically, South Asians have utilized economic pathways more than any other admission category. Data from Statistics Canada confirms that among South Asian immigrants who arrived between 1980 and 2021, more than half were admitted under the economic category. This trend has accelerated in recent years; for those arriving between 2011 and 2021, approximately two-thirds entered via economic streams.
This reliance on economic immigration is particularly pronounced for immigrants from India, Pakistan, and Bangladesh. In contrast, immigrants from Sri Lanka have historically arrived through a mix of refugee protection, family sponsorship, and economic categories. As Canada refines its Express Entry system for 2026, placing greater emphasis on category-based selection (such as STEM and healthcare occupations), South Asian applicants are well-positioned to continue dominating these invitations due to their strong alignment with Canada’s labour market needs.
Education Levels and Labour Market Outcomes
One of the most defining characteristics of the South Asian workforce in Canada is its high level of educational attainment. In 2021, approximately 58% of South Asians aged 25 to 54 held a bachelor’s degree or higher. This is significantly higher than the 32% observed in the non-racialized, non-Indigenous population.
Despite these impressive credentials, challenges in labour market integration persist. While South Asian men aged 25 to 54 boast employment rates comparable to the national average, there is a distinct gap for South Asian women, whose employment rates were approximately 10 percentage points lower than their non-racialized counterparts. Furthermore, the issue of “underemployment”—where highly skilled immigrants work in jobs that do not require their level of education—remains a critical focus for the government. Addressing the recognition of foreign credentials will be a top priority for provincial and federal governments heading into 2026 to ensure this talent pool is fully utilized.
Family Structure and Housing Implications
The social structure of South Asian households differs significantly from the Canadian average, with direct implications for housing and urban development. Statistics Canada reports that about 20% of South Asians live in multigenerational households, compared to just 7% of the overall population.
This preference for multigenerational living—often driven by cultural values of caring for elders and pooling resources—creates specific demands for the housing market. There is a growing need for larger residential units, “in-law suites,” and community planning that accommodates larger family units. As cities like Toronto, Vancouver, and Calgary continue to expand, urban planners must account for these demographics to ensure adequate housing supply for 2026 and future decades.
Policy Implications for 2026 and Beyond
The data presents a clear mandate for future policy. With South Asians projected to form the largest immigrant workforce group, the Government of Canada is expected to continue tailoring its settlement services and anti-racism strategies to support this community. The Disaggregated Data Action Plan is already in motion to better understand the nuances within this group, ensuring that support is directed where it is needed most—particularly in closing the employment gap for women and ensuring equitable access to management positions.
For employers, the message is equally clear: diversity, equity, and inclusion strategies are not just social goals but economic imperatives. Successfully integrating and advancing South Asian talent will be a key determinant of competitive advantage in the Canadian economy of the 2040s.
Official Government Sources
For further reading and verification of the statistics presented in this article, please refer to the following official government reports:
- Portrait of the South Asian populations in Canada: Diversity and socioeconomic outcomes https://www150.statcan.gc.ca/n1/pub/89-657-x/89-657-x2025007-eng.htm
- Canada in 2041: Population projections for racialized groups https://www150.statcan.gc.ca/n1/daily-quotidien/220908/dq220908a-eng.htm
Frequently Asked Questions (FAQs)
Why is the South Asian population in Canada growing so fast?
The rapid growth is primarily driven by sustained economic immigration. Canada’s immigration targets have increased over the years to combat an aging domestic workforce, and South Asian countries—particularly India—are the leading source of skilled immigrants who qualify under the economic category.
What are the main countries of origin for South Asian Canadians?
While India is the largest source country, accounting for 44% of the population, significant numbers also come from Pakistan, Sri Lanka, and Bangladesh. There are also large communities of South Asians who immigrated from the Caribbean, East Africa, and the Middle East.
How does the education level of South Asians compare to the general population?
South Asians are highly educated. Approximately 58% of core-aged South Asians hold a university degree, compared to 32% of the non-racialized population. This high level of education makes them a crucial asset for Canada’s knowledge-based economy in 2026.
Are South Asian women employed at the same rate as men?
No, there is currently a gender gap. While South Asian men have employment rates similar to the national average, South Asian women have an employment rate about 10% lower. The government is looking into targeted support to help reduce barriers for these women entering the workforce.
What is the projection for the South Asian population by 2041?
Statistics Canada projects that the South Asian population could reach between 4.7 million and 6.5 million by 2041, potentially making up 12.5% of Canada’s total population.
What does “category” refer to in this context?
In this article, “category” refers to the classification of immigrants, such as the “economic category” (skilled workers), “family category” (sponsorship), or specific selection categories within the Express Entry system.
