In a significant move aimed at reshaping the landscape of Canada’s labour market, the Canadian government has announced plans to reduce the number of Temporary Foreign Workers (TFWs) by 65,000 on 26th August 2024.
This decision, which has far-reaching implications for employers and workers alike, is part of a broader strategy to address labour shortages while ensuring that Canadian citizens and permanent residents have greater access to available jobs.
Details of the New Measures
The announced measures include a phased reduction in the number of Temporary Foreign Workers allowed into Canada, with the goal of cutting 65,000 positions over the next few years.
The reduction will be implemented through tighter regulations on TFWP applications and a more rigorous assessment process to ensure that employers are making genuine efforts to recruit Canadians before turning to foreign labour.
The new measures will end low-wage temporary foreign workers in regions with unemployment rates of 6% or higher, reduce the percentage of employers’ workforces that can consist of low-wage temporary foreign workers to 10%, and limit the duration of these permits to one year instead of two, with exemptions for certain sectors such as agriculture, food processing, construction, and healthcare.
The Canadian government granted Quebec’s request to put the TFWP in Montreal on temporary hold on August 20. This action attempts to allay worries in the area about how the program would affect the local labour market.
Additionally, the government is set to introduce stricter penalties for employers who do not comply with the new rules. This includes increased fines and the possibility of being barred from accessing the TFWP in the future. The emphasis will be on ensuring that the use of temporary foreign labour is truly a last resort.
Context and Background
For a considerable amount of time, Canada has depended on the Temporary Foreign Worker Program (TFWP) to bridge gaps in the labour market, especially in sectors like construction, hospitality, and agriculture where there is a severe lack of local labour. But worries regarding the use of temporary labour and its effects on the Canadian labour force have been mounting.
In response to these worries, the government recently made a decision that indicates a change in emphasis towards giving employment opportunities to Canadian citizens and permanent residents top priority. The government hopes to strengthen the domestic workforce by encouraging employers to invest more in hiring and training domestic workers by lowering the number of TFWs.
Low-wage temporary foreign workers (TEFs) will now be limited to one-year contracts, down from two years, and Prime Minister Justin Trudeau stressed that Canadian companies need to focus on investing in training and technology, rather than relying more on cheap foreign labour. “This is unfair to Canadians who are struggling to find good jobs, and it’s also unfair to temporary foreign workers, some of whom are being abused and exploited,” he said.
Conservative MP Melissa Lantsman, the party’s deputy leader, criticized the government’s decision to cut TFWs as a reversal of policies introduced by former immigration minister Sean Fraser. Lantsman argued that Fraser’s policies damaged the immigration system and are now responsible for the housing crisis.
Mike Moffatt, senior policy director at the Smart Prosperity Institute, welcomed Ottawa’s decision to reduce the number of TFWs in the low-wage workforce, calling it a “great first step,” but said more needs to be done. He also suggested adjusting the higher-wage portion of the program to allow TFWs to fill more of the entry-level administrative jobs that Canadian workers can fill.
Nevertheless, the decision of the TFW program to strengthen the TFW program has been criticized by a group to protect immigration rights. Sayed Hassan, an executive director of the Change of immigration alliance said,it is not caused by immigrants or immigrants with high unemployment, low -wages, and immigrants, but is caused by the operation of employers and political failure. I insisted. “Migrants build communities, and they deserve equal rights and respect, not scapegoating,” he stressed, adding that high unemployment among immigrants is often due to “racism and discrimination” rather than the presence of foreign workers.
Impact on employers and employees
For employers, especially in sectors that rely heavily on TFW, this policy change could pose challenges. They will have to adapt to the new rules by increasing recruitment in Canada and possibly raising wages to attract domestic workers. This can lead to higher operating costs, especially in sectors where profit margins are already low.
However, the measure could lead to improved employment prospects for Canadians and permanent residents, especially in areas and sectors of the economy where foreign workers have historically held sway. The long-term benefits of the government’s focus on upskilling and educating the national workforce could include a more flexible and resilient labour market.
What to Expect
According to Trudeau, the government is also examining the immigration pathways for permanent residents.”We’re keeping an eye on a number of avenues to make sure Canada continues to be a welcoming country for immigration and responsibly integrates newcomers,” he said.
The government plans to unveil a more detailed immigration strategy later this fall. The decision comes in response to Trudeau’s declining approval ratings ahead of the next election, which has left many Canadians concerned about the number of immigrants entering their country.
