Canada has suspended the processing of Labour Market Impact Assessments (LMIAs) under the Low-Wage stream of the Temporary Foreign Worker Program (TFWP) for regions with unemployment rates of 6% or higher.
This means that employers in these areas will no longer be able to hire foreign workers for low-wage jobs, and they will have to prioritise local workers instead. The suspension was announced by Employment and Social Development Canada (ESDC) on August 26 and applies specifically to Census Metropolitan Areas (CMAs) with high unemployment rates. CMAs are defined as areas with a population of at least 100,000, with 50,000 or more residing in the core.
But which regions could be impacted the most by this decision?
Some of the largest CMAs in Canada, including Windsor, Edmonton, and Toronto, have the highest unemployment rates, making them likely candidates for this suspension, according to Statistics Canada. Here are the CMAs with unemployment rates of 6% or higher as of August:
Windsor: 9.2%
Edmonton: 8.6%
Toronto: 8.0%
Oshawa: 7.8%
Calgary: 7.6%
Kitchener-Cambridge-Waterloo: 7.6%
St. Catharines-Niagara: 7.5%
London: 7.5%
Hamilton: 7.4%
Montréal: 7.3%
St. John’s: 7.2%
Ottawa-Gatineau (Ontario part): 7.1%
Trois-Rivières: 6.5%
Kingston: 6.6%
Regina: 6.8%
Saint John: 6.8%
Abbotsford-Mission: 6.7%
Greater Sudbury: 6.2%
Vancouver: 6.2%
Barrie: 6.2%
In contrast, regions like Victoria and Québec, with unemployment rates of 3.3% and 4.0%, respectively, will not be affected by this suspension.
Note: While many government agencies rely on Statistics Canada, this data alone cannot definitively determine which areas will be affected by ESDC’s latest announcement.
Why has Canada suspended this programme in certain areas?
The Temporary Foreign Worker Program (TFWP) suspension comes in response to rising unemployment rates in certain CMAs. The Canadian government is keen on encouraging local employment, especially in regions where the job market is struggling. This is why the LMIA process for low-wage jobs has been halted in areas with unemployment rates of 6% or higher.
The TFWP allows employers to hire foreign workers when local workers are not available. However, by suspending this programme in high-unemployment regions, the government is pushing employers to prioritise hiring Canadian citizens and permanent residents before considering temporary foreign workers. It’s a move aimed at reducing joblessness in the affected areas by ensuring that local workers are given priority for available positions.
What prompted Canada to reduce its reliance on foreign workers?
Canada’s decision to limit temporary foreign workers in certain regions comes amid growing concerns about the country’s labour market and the potential overuse of foreign workers in industries where local talent could fill positions. In March, Employment Minister Randy Boissonnault and Immigration Minister Marc Miller spoke about the inclusion of temporary resident levels in Canada’s Immigration Levels Plan. “We need to ensure that Canadian employers are not overly relying on temporary foreign workers, especially in regions where local talent can fill these jobs. The Temporary Foreign Worker Programme is important, but it’s critical that it doesn’t result in wage suppression or reduced opportunities for Canadians,” he said.
How does this policy affect Indian workers?
The impact on Indian workers, who represent a large proportion of foreign workers in Canada, could be considerable. As of July 2024, 52,455 Indian citizens were holding valid work permits under the Temporary Foreign Worker Programme, IRCC informed Business Standard. Out of these, 29,455 were in higher-skilled roles such as management, professional, and technical positions. The remaining 22,000 permits were likely held by workers in lower-skilled jobs.
While the LMIA suspension applies to low-wage jobs, the higher-skilled positions occupied by many Indian workers are unlikely to be affected by this particular policy. However, it could still limit opportunities for those seeking entry-level or low-wage positions in Canada’s labour market.
What are CMAs?
Census Metropolitan Areas (CMAs) are regions formed by one or more municipalities around a core population centre, with at least 100,000 residents. These areas are economically and socially integrated through commuting patterns and other factors. The CMA classification is important because it helps determine which regions are subject to the LMIA suspension under the TFWP.
Unlike Census Agglomerations, which can lose their status if population thresholds drop, CMAs retain their designation even if their population decreases. For example, Toronto and Mississauga are separate cities but are both part of the Toronto CMA. This classification helps the government identify regions where unemployment is high and where foreign workers might be taking jobs that could otherwise go to local residents.
The move to suspend the LMIA process for low-wage jobs in these areas is part of a larger effort to stabilise Canada’s labour market and address rising unemployment. The programme is expected to remain in place for as long as the unemployment rate stays above 6% in the affected CMAs.
First Published: Sep 11 2024 | 8:13 AM IST
