Today, the Government of Canada revealed that it will cease processing LMIAs for the Low-Wage Stream in metropolitan areas where the unemployment rate is 6% or above.
In addition, the Canadian government introduced several major changes to the Temporary Foreign Worker (TFW) Program. These changes are designed to reduce dependency on foreign workers and emphasize the importance of Canadian talent.
This decision addresses the growing misuse of the program and reflects the evolving labour market conditions, including the increasing unemployment rate.
Major Changes Starting September 26, 2024
Starting September 26, 2024, the Government of Canada will introduce the following changes to the TFW Program:
- LMIA Refusals in High-Unemployment Areas: The government will no longer process LMIAs in the Low-Wage stream for census metropolitan areas with an unemployment rate of 6% or higher. Exceptions will be made for critical sectors related to food security—such as primary agriculture, food processing, and fish processing—as well as for construction and healthcare roles.
- 10% Cap on Foreign Workers: Employers will be restricted to hiring a maximum of 10% of their total workforce through the TFW Program, down from the 20% cap established in March 2024. Exceptions will apply to the same critical sectors.
- Shortened Employment Duration: The maximum employment duration for workers hired under the Low-Wage stream will be reduced to one year, down from the previous two-year limit.
Government’s Emphasis on Canadian Workers
Randy Boissonnault, Minister of Employment, Workforce Development, and Official Languages, highlighted the importance of focusing on the domestic workforce.
“The Temporary Foreign Worker Program was intended to address labor shortages when qualified Canadians were unavailable for certain roles. Currently, there are more Canadians who are qualified for these positions. The changes we are implementing today will prioritize Canadian workers and ensure the program aligns with our economic needs,” stated Minister Boissonnault.
The government is urging Canadian employers to tap into underutilized domestic talent, including youth, newcomers, and individuals with disabilities.
Additionally, employers are encouraged to invest in retraining and upskilling their existing employees to better meet the demands of the changing economic environment.
Oversight and Future Modifications
The Government of Canada is dedicated to continuously monitoring labor market conditions and will adjust the TFW Program as needed.
A thorough review of the program will be carried out within the next 90 days, which may result in modifications to the high-wage stream, sectoral exceptions, and the processing of current LMIA applications.
Increasing Unemployment and Policy Changes
These changes are part of a broader initiative by the Canadian government to reverse pandemic-era policies that were put in place to address an exceptional labor shortage.
As the labor market in Canada has eased, with the unemployment rate rising to 6.4% in June 2024, the government has started reducing the validity period of LMIAs from 18 months to 6 months and decreasing the cap on temporary foreign workers from 30% to 20%.
Additionally, on August 20, 2024, the Government of Canada approved Quebec’s proposal for a temporary freeze on new TFW approvals in the low-wage stream for Montreal.
Effective September 3, 2024, the processing of LMIA applications will be paused for six months for job offers in Montreal that offer wages below $27.47 per hour, which is Quebec’s current median hourly wage.
The Government of Canada’s recent measures demonstrate a firm commitment to ensuring the proper use of the TFW Program and prioritizing Canadian workers in the job market.
As the labor market continues to evolve, additional adjustments to the program are anticipated to better align with the country’s economic requirements.
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