Jason Kenney is Minister of Employment and Social Development and Minister for Multiculturalism
There has been a lot of controversy surrounding the Temporary Foreign Worker Program (TFWP) lately, provoked in part by commendable media reports highlighting abuses of the program. Our government will fundamentally overhaul the TFWP to tackle such abuses, and to prevent the program from distorting Canada’s labour market. Our goal will be to mend the program, not end it. But before we do so, it is important to understand the facts, and dispel some myths.
According to a commonly held view, the program is mainly about allowing employers to hire large numbers of people from abroad to fill low-skilled positions at below Canadian wage rates, often leading to the exploitation of vulnerable, indentured foreign workers. This betrays a complete misunderstanding of the TFWP.
First off, what we call the TFWP is, in fact, a wide array of different programs developed over time, the only common aspect of which is the authorization of foreign nationals to work in Canada. Most “temporary foreign workers” do not actually come at the request of employers to fill specific jobs, but rather as part of reciprocal agreements that we have with other countries that in turn allow millions of Canadians to pursue opportunities abroad. Of the 221,000 foreign workers who entered Canada last year, only 55,000 came to fill low-skilled jobs at the request of employers, and 62 per cent of those were farm workers.
This is underscored by the fact that most of the top source countries for the TFWP are wealthy, advanced economies. The United States, United Kingdom, France and Australia are amongst the top five source countries for foreign workers in Canada, while Germany and Ireland are also in the top ten.
Contrary to the myth, a typical temporary foreign worker is in fact an American lawyer working on a transaction here thanks to a NAFTA visa, a French scientist doing advanced research at a Canadian university on a research work permit, or a young Aussie on her gap year working at a ski hill, as part of a reciprocal Youth Mobility Program.
Secondly, the TFWP does not allow foreign workers to be paid less than Canadians working in similar jobs. Employers who seek to bring in workers from abroad must first certify that they have tried to hire Canadians at the prevailing median wage rate for the job in that area (which is by definition above the starting wage rate), and that no qualified Canadians have applied. If foreign workers are approved and enter Canada, they have exactly the same protections as Canadians under provincial and federal laws.
Thirdly, the number of foreign workers in Canada has been massively exaggerated. According to a recent poll, Canadians believe that 12 per cent of our labour force is made up of TFWs, when the real number is 2 per cent. Many believe that most temporary foreign workers are low-skilled service industry employees. For example, NDP Leader Thomas Mulcair said the TFWP “morphed into having everybody in your McDonald's or your Tim Horton's coming from another country.” But in fact, only 0.21 per cent of Canada’s work force is made up of temporary foreign workers in such low-skilled jobs, and only 2 per cent of Canada’s 1.1 million restaurant workers are temporary foreign workers. This is why Statistics Canada has said that the program’s impact on unemployment is “negligible."
Setting these facts straight is not to diminish very real problems that exist in the program, but rather to put those problems in context. Indeed, we are concerned with growing evidence that some businesses have abused the program by resorting to foreign workers without making adequate efforts to hire Canadians, allowing what is supposed to be a last resort to become a business model in some cases. Such practices have apparently resulted in distortions of the labour market in certain sectors and regions.
Several recent studies have come to this conclusion, suggesting that over-reliance on the program’s general low-skilled stream has prevented wages from rising in some low-paid occupations in parts of Western Canada, and may have reduced labour mobility. For example, overall median wages in Alberta have gone up by an average of 31 per cent since 2006, but wages in the province’s food services sector, a heavy user of the program, increased by only 8 per cent. This kind of distortion is unacceptable.
Former Bank of Canada governor Mark Carney put it well last year when he said “(We) don’t want an over-reliance on temporary foreign workers for lower-skilled jobs, which prevent the wage adjustment mechanism from making sure that Canadians are paid higher wages, but also so that firms improve their productivity as necessary… The intent of the government’s review is to ensure that this is used for transition, for those higher-skilled gaps that exist and can hold our economy back.”
That’s precisely why we have spent two years consulting on a bold package of reforms to ensure that Canadian workers come first, that employers respond to labour shortages through higher wages, while allowing the program to continue as a last and limited resort.