Recent Shifts in Canadian Immigration: A Strategic Maneuver?

Understanding Low-Wage LMIAs

A Labour Market Impact Assessment (LMIA) is a document that Canadian employers need to obtain before hiring a foreign worker. It serves as proof that there is a need for a foreign worker to fill the job and that no Canadian worker is available to do the job. LMIAs are categorized into high-wage or low-wage, depending on whether the offered wage is above or below the provincial/territorial median hourly wage. This announcement brought about three new regulations on LMIAS:

1. Discontinuation on processing Low-wage LMIAS in major cities: The government will refuse to process LMIAs in the Low-Wage stream for census metropolitan areas where the unemployment rate is 6% or higher.

2. Limitation to 10% on Temporary Foreign Workers: Employers are restricted to having a maximum of 10% of their workforce composed of employees hired via the Temporary Foreign Worker Program (TFWP). Exemptions to this rule will be applicable to the essential sectors previously noted.

3. Shortened Work Period for Low-Wage Workers: Workers secured through the Low-Wage stream of the TFWP will now be allowed to work for a maximum of one year, a decrease from the earlier limit of two years.

To give you and idea of what low-wage means, The provincial/territorial median hourly wage in Ontario is $28.39/hour. Wages under $28.39 are considered low wage for LMIA applications.

The discontinuation of low-wage LMIAs represents a significant shift. This policy change restricts employers’ ability to hire foreign workers for positions that pay less than the median wage, which could potentially reduce the number of temporary foreign workers entering Canada for lower-paying jobs. This move may be interpreted as an effort to ensure that Canadians have first access to these positions, but it also reduces the pool of available labor for industries that traditionally rely on low-wage foreign workers.

It is important to note that the discontinuation of low-wage LMIAs did have a number of exempted industries: Health care (including home support workers), construction, jobs in critial food security (agriculture) and food processing, and construction.

Halting Work Permit Applications for Visitors

The second notable change is the cessation of a temporary public policy that allowed visitors already in Canada to apply for an employer-specific work permit without having to leave the country. This policy was introduced as a temporary measure during the COVID-19 pandemic to provide flexibility in the face of travel restrictions and labor market needs. Its unexpected termination means that visitors, such as tourists or those on business trips, must now apply for work permits before arriving in Canada or leave Canada to apply from abroad.

The Bigger Picture: Reducing Temporary Resident Numbers?

These policy changes could be part of a larger strategy to reduce the number of temporary residents in Canada. By tightening the rules around LMIAs and work permits, the government may be aiming to decrease the influx of temporary foreign workers and visitors with work intentions. This approach might be influenced by several factors, including the upcoming election and the public sentiment regarding housing prices. The official reasoning given by the minister was that the unemployment rate in many of Canada’s major cities has gone up, and Canadians and permanent residents are finding difficulty in landing a job. The current unemployment rate in Toronto is 7.7%.

With an election on the horizon, political parties often refine their platforms to resonate with voters’ concerns. Housing affordability has become a hot-button issue in Canada, with some voices in the public debate suggesting that temporary residents, such as international students and foreign workers, contribute to the housing crunch. By implementing policies that appear to address these concerns, the government could be positioning itself favorably with constituents who are feeling the pinch of high housing costs.

Conclusion: A Calculated Approach?

In conclusion, the recent changes to Canadian immigration policies may reflect a calculated approach by the government to address economic and social issues while aligning with public sentiment and electoral strategies. The cessation of low-wage LMIAs and the reversal of the temporary work permit policy for visitors could be seen as measures to prioritize the Canadian labor market and housing for Canadians. Whether these changes will have the desired effect on immigration numbers and public perception remains to be seen, but they undoubtedly mark a significant pivot in Canada’s approach to managing its immigration intake. We’re all holding our breath to see what’s in store for the annual National Levels plan, usually released every year in November, projecting IRCC’s immigration plan for the next few years.

In your opinion, what are the potential benefits and drawbacks of requiring individuals to apply for work permits before arriving in Canada?

What are your thoughts on the balance between protecting Canadian jobs and fulfilling labor market needs with temporary foreign workers?