Canada Reins in Temporary Workers amid Public Pressure and Growing Strain with U.S.

FAIR Take | September 2024

Canadian Prime Minister, Justin Trudeau, once boasted that Canada’s immigration system was a source of strength. However, as next year’s elections loom, polls show Canadians are souring on mass migration. And with Canada’s unemployment rate at a 30-month high, the Trudeau government has decided to reform Canada’s Temporary Foreign Worker (TFW) Program.

The announcement, made by Trudeau’s government in late August, will reduce the duration of employers may hire low-wage foreign workers from two years to one.  The government will also lower the percentage of low-wage foreign workers Canadian employers may hire by half – from 20 to 10 percent.

The main reason Canada is reining in the TFW program is due to public pressure stemming from years of open-borders policies. Canada’s temporary population alone – which includes temporary workers, asylum-seekers, and foreign students – has ballooned to 2.8 million, rising from 3.5 percent of the country’s total population two years ago to 6.8 percent now. Both temporary and permanent immigration have also contributed to Canada’s highest population growth in decades, with approximately 96 percent of the increase attributable to migration. The surge in migrants has contributed in part to shortages and higher prices for housing. Although Ottawa originally planned to allow 500,000 migrants to enter in both 2025 and 2026, these targets are reportedly being reconsidered. The Trudeau government capped the number of foreign students in January.

Driving public discontent is the increasing competition from low-wage, low-skill migrants which has distorted the Canadian job market. Even the U.N. Special Rapporteur on Contemporary Forms of Slavery commented that low-wage migrants in Canada were working in conditions that were “exploitative.” This has prompted Prime Minister Trudeau to declare that “[I]t’s not fair to Canadians struggling to find a good job, and it’s not fair to those temporary foreign workers, some of whom are being mistreated and exploited.” Trudeau said that Canada should pivot to training Canadians and reducing reliance on low-wage labor.

Canada’s announcement marks a reversal of its 2022 post-pandemic liberalization of the Temporary Foreign Worker program – a response to restauranteurs and other employers who claimed they struggled to find workers. The 2022 policy increased the percentage of foreign temporary workers that employers could hire to 20 percent, or even 30 percent in certain sectors such as food service and accommodation. However, as The Globe and Mail reminds us, these increases were from the original threshold of 10 percent, showing that the current policy announcement is less of a revolution and more of a return to pre-pandemic levels.

In addition to addressing public displeasure with the economic impact of mass immigration, Ottawa is reining in the program to improve relations with the United States. As the Financial Times reports, the U.S. has pressured the Canadian government to stem the flow of foreign workers because some of these workers are illegally entering the United States. Encounters of illegal aliens at the U.S.-Canada land border have risen by almost 600 percent between Fiscal Years (FY) 2021 and 2023, and FY 2024 numbers may match or even exceed FY 2023 encounters (189,402). Some migrants who intend to make the U.S. their ultimate destination see Canada, with easier visa rules and a long, mostly unmanned border with the U.S., as an easier way to enter the U.S.

It’s unclear whether the new immigration policies being implemented by the Trudeau government will have a meaningful impact quickly enough to satisfy our Canadian neighbors to the North—or the U.S. government, which is desperately trying to hide all signs of illegal immigration during election season. What is clear, however, is that both Prime Minister Trudeau and the Biden-Harris Administration understand there is potential political fallout if they ignore the greater will of the people in favor of special interest, open-borders advocates.