This is a very difficult topic to tackle.. tells you a lot about why CBSA/ CIC etc are not on top of it.
The reason for people being in Canada illegally varies. some do it because they are avoiding a possible legal prosecution for crimes in their home countries, some do it because they have no choice and its better to work illegally in Canada than starve to death i their home country. But mostly people in these situation are just victims of circumstances and want a better life for them and their families. Mind you, being an illegal is not a better life but it may very well be better than the life they would have in their own country. so lets not judge those who we don't know anything about.
as for working illegally under the table, the person hiring such workers is actually more at fault than those working. The employer is probably getting away with not paying taxes etc himself and paying much less to the worker. I have heard of cases where employers exploit these kinds of workers by making them work for some time and not paying them and threatening to report them. so there's more exploitation towards illegal workers.
also, perhaps its good to clarify the fact that a person with no legal status in Canada is not entitled to free medical or other social services as some of you blindly believe. Even visitors with legal status have no entitlement (except for some cases).
On the reporting part, i wouldn't be surprised if people who think about or do report illegals have a hidden agenda and being a model citizen is probably not on the top of their to-do list. It could be out of jealousy or other personal matter. I bet you those who do the reporting are immigrants themselves because i have seen this mentality, especially among those from India but it may very well be present in other nationalities too, they don't like seeing others from their neck of the woods succeed in life. some even go as far as focusing more on how to get others down rather than making their lives better. I know too many of these kinds of stories where people would report to CIC about incidents being fake (even though they are genuine) just to make some people go through misery.
Remember what Russell Peters said, we don't hate people from other countries, we hate each other (by we, he referred to indians).