Trudeau tightens the TFWP in response to immigration challenges and high youth unemployment
In response to growing immigration challenges and high youth unemployment rates, the Trudeau government is finally tightening its Temporary Foreign Worker Program (TFWP).
Beginning September 26, the government will halt the processing of Labour Market Impact Assessments for the Low-Wage stream of the TFWP in certain census metropolitan areas. This suspension will affect cities with an unemployment rate of six6 percent or higher, though the specific locations have not yet been disclosed.
Exceptions will be made for sectors vital to food security, such as primary agriculture, food processing, and fish processing. Still, the food service industry will not be exempt from these changes.
The TFWP, established in 1973 under Pierre Trudeau, was initially designed to address labour shortages by allowing employers to hire foreign nationals when qualified Canadians or permanent residents were unavailable. Over time, the program expanded to include a “low-skilled workers” category, introduced in 2002 under Jean Chrétien’s Liberal government. This category has since become the backbone of the temporary foreign workforce in Canada. However, many sectors have become overly dependent on this program to fill low-wage positions, leading to systemic abuses that the government should have addressed long ago.
Businesses will now be encouraged to invest in productivity improvements. Still, monitoring how these changes will impact the entire food supply chain, including the food service sector, is crucial. The road ahead will not be without challenges.
Restaurants Canada, a key industry group, has already expressed concern. The organization notes that while only three percent of food service employees are hired through the TFWP, the program is essential for restaurant operators who struggle to find Canadian workers for specific roles. The new limitations, which cap the use of temporary foreign workers at 10 percent across all industries and shorten the maximum employment duration from two years to one year, could significantly disrupt the food service sector.
Despite these concerns, Ottawa’s decision is the right one, though long overdue. It’s significant that this move comes from a government previously criticized for its open-door immigration policies. Not long ago, any effort to tighten immigration was labelled as xenophobic and un-Canadian.
However, Canada’s current approach to immigration has not delivered the economic benefits many had hoped for. While our population continues to grow, GDP per capita remains stagnant, leading some economists to describe this as a “Per Capita Recession,” which occurs when a country’s Gross Domestic Product (GDP) per capita – essentially the economic output per person – declines, even if the overall GDP of the country is growing. This often results in a lower standard of living for the average citizen.
This disconnect underscores the need for a more strategic immigration policy that carefully balances the influx of new citizens with the country’s ability to provide sufficient housing and a strong labour market.
The inconsistency and political rhetoric surrounding these issues are frustrating. The same government that once expanded immigration recklessly is now abruptly scaling back the TFWP. Adding to the confusion, people like Mike Moffatt from the Smart Prosperity Institute – a left-leaning think tank heavily funded by Ottawa – have shifted from promoting increased immigration to now supporting restrictions. This flip-flopping creates more uncertainty for businesses and workers alike, further eroding trust in the government’s ability to manage these critical issues effectively.
Temporary foreign workers are people, and the companies that hire them need predictability and stability – something that’s been lacking in recent years. While cheap labour keeps costs down, it also leads to economic complacency and inefficiency. Ottawa’s recent changes to the TFWP address a problem of their own making, and they deserve some credit for that.
But the broader challenge remains: ensuring that Canada’s immigration and labour policies work in tandem to support sustainable economic growth. The food supply chain seems spared for now, but the full impact of these changes will become clear over time.
Dr. Sylvain Charlebois, a Canadian professor and researcher specializing in food distribution and policy, is a senior director of the Agri-Food Analytics Lab at Dalhousie University and Co-Host of The Food Professor Podcast. He is frequently cited in the media for his insights on food prices, agricultural trends, and the global food supply chain.
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