Economic and Social Reports, June 2025

There are six new articles available in today's release of Economic and Social Reports.

Canadian travel to the United States on a decline in early 2025

In 2024, Canadian-resident trips to the United States totalled 39 million, representing 75% of all Canadian-resident travel abroad. Recent data show that automobile travel by Canadians to the United States has fallen significantly, recording five consecutive months of year-over-year declines. The article, "Recent changes in Canadian-resident travel to the United States," found that, in May 2025, return trips from the United States by automobile declined 38.1% year over year, dropping further below the 35.2% decline recorded in April. This trend of declines marked the first time since early 2021, when COVID-19 pandemic restrictions were still in place, that Canadian-resident return trips by automobile from the United States declined.

Same-day travel to the United States by automobile also dropped abruptly at the start of 2025, after holding consistently positive throughout 2024. Same-day returns fell by 40.3% year over year in May 2025, marking a fourth consecutive month of steep decline. Meanwhile, overnight travel decreased by 34.3%.

These recent findings suggest a notable change in travel plans: Canadian residents are less likely to visit the United States than overseas destinations. However, it is too early to know if this trend will persist.

Intellectual property may delay business closures

While most business closures can be the direct result of small and medium-sized enterprises' failure to compete in a private market, when firms' exits involve intellectual property (IP), this may play a double role. The study, "Intellectual property in the context of firms' exit strategies: The role of patents," explores how IP can be a valuable asset to attract investors and secure financing, but it can also be a very attractive asset for established businesses to acquire, accelerating exit from the market through mergers and acquisitions.

The study found that, from 2002 to 2012, firms that patent are more likely to be larger, to perform research and development, to export their products and be active seven years after entry relative to businesses that do not patent. Furthermore, having a patent is likely to delay exit by increasing the probability for a business to be active seven years after entry by 4.5%. However, the effect of patents on mergers and acquisitions was found to be positive but not significant.

This study is the first of its kind to provide insights on both survival and trigger effects associated with patents to increase the likelihood of a new business surviving or exiting the market. By considering patents' survival effect, this study shows that innovation combined with a strategic use of patents can set the path for Canadian businesses to grow and prosper.

Immigrants who acquired citizenship by 2023 have higher employment rate and earnings than immigrants who have yet to acquire citizenship

Immigrants who obtain citizenship in their new country often gain enhanced legal status, expanded rights, increased political and civic engagement and a stronger sense of belonging. However, research remains limited on whether citizenship itself leads to improved labour market outcomes. The study, "Citizenship and the economic outcomes of immigrants in Canada," explores whether Canadian citizenship is associated with better economic outcomes and if acquiring citizenship directly improves labour market performance.

Among immigrants who were admitted from 2003 to 2012 and aged 25 to 54 years at admission, those who acquired citizenship (were naturalized) by 2023 had a considerably higher employment rate and earnings than non-naturalized immigrants. For instance, five years after admission, naturalized immigrant men earned 31% more annually than their non-naturalized counterparts.

Naturalized immigrants had better economic outcomes than non-naturalized immigrants even before acquiring citizenship. Their economic trajectories changed little in the years immediately before and after naturalization, suggesting that unmeasured characteristics, such as motivation and skills, may drive both naturalization and economic success. These findings imply that the significance of Canadian citizenship might encompass more than just economic benefits and highlight the importance of fostering social inclusion, civic participation and a sense of belonging as meaningful aspects of the naturalization process.

Availability and affordability potential barriers to participating in child care for children with long-term conditions or disabilities

The Canada-wide early learning and child care system aims to provide families with affordable, inclusive and high quality early learning and child care programs and services. Children with disabilities are a highly diverse group with additional support needs; however, little is known about their inclusion in child care programs. The study, "Children with long-term conditions or disabilities: Why some are not in non-parental child care," explores the potential barriers to participating in non-parental child care among children aged 0 to 5 years with long-term conditions or disabilities.

A shortage of places or waitlists (34%) was the most frequently reported reason for not using child care among non-users whose parents looked for child care for their children with long-term conditions or disabilities. Child care availability in the community was the most frequently reported difficulty among both users (66%) and non-users whose parents looked for child care (61%). However, finding affordable child care (54%) and subsidized child care (43%) emerged as distinct difficulties among non-users whose parents looked for child care. Compared with child care users, non-users appeared to be at a socioeconomic disadvantage (e.g., low-income families or parents with lower educational attainment).

Overall, in 2023, availability and affordability remained potential barriers to participating in child care among non-users whose parents looked for child care. Future research may focus on whether parents of children with more severe long-term conditions or disabilities are more likely than those of children with less severe long-term conditions or disabilities not to look for child care.

Data comparability issues in estimating immigrant citizenship rates in Canada and the United States

Recent studies have documented a significant decline in citizenship rates among recent immigrants in Canada. Comparisons with other countries can shed light on how factors such as increased international migration fluidity and socioeconomic development in some source countries influence immigrants obtaining citizenship (naturalization). The study, "Estimating immigrant citizenship rates in Canada and the United States: Data sources and comparability issues," explores the feasibility of using two US data sources to reliably compare naturalization levels and trends with those in Canada.

The article demonstrates that the two key US data sources—the American Community Survey (ACS) and lawful permanent resident (LPR) data—produce markedly different citizenship rates and trends due to substantial differences in their base populations. The ACS includes permanent residents, legal temporary residents and undocumented migrants who are not eligible for naturalization, while the LPR data cover all individuals granted permanent residency, regardless of whether they currently reside in the United States. As a result, citizenship rates derived from these US sources are not directly comparable with Canadian estimates, which are based on eligible permanent residents observed in the Census of Population or the Longitudinal Immigration Database.

Therefore, caution is warranted when comparing immigrant citizenship levels and trends between Canada and the United States using these commonly used data sources.

The economic impact of wildfires

Given the changing climate, wildfire risk will likely continue to increase into the future; therefore, it is critical to understand the extent to which economic activity is at risk from wildfires. Using experimental estimates of gross domestic product (GDP) by square kilometre in Canada, early estimates of the proportion of GDP at risk from the 2025 wildfire season have been published today in the release, ''Early estimates of the potential economic disruption from the 2025 wildfire season.'' More information on this innovative methodology can be found in the study, "Estimates of gross domestic product in wildfire-affected areas during the 2023 and 2024 wildfire seasons."