IRPP: Temporary Foreign Workers Program – To Cap or Not to Cap?

TFW PICAn interesting article on the Huffington Post Canada website caught my attention this morning, as I have written a number of articles on the subject of the Temporary Foreign Workers Program. Naturally, I immediately decided to share this information with my readers!

A new report from the Institute for Research on Public Policy (IRPP) speaks to how Canada could, and perhaps should, place a cap on the number of temporary foreign workers it permits into the country, before the program grows too large, and threatens Canadians’ livelihoods.

The report, authored by Christopher Worswick, a Carleton University Labour Economics Professor, finds “the growth within the number of temporary foreign workers numbers may be a cause for concern. Its timing, coinciding with a period of weakness within the Canadian economy, is very worrisome.

As you know, Canada’s temporary foreign workers (TFW) program became a hot-button issue earlier this year once it emerged that laid-off IT employees at RBC were asked to train temporary foreign workers hired to replace them.

The controversial move by RBC set off a debate on the real value of the TFW program, with some labour groups calling for an elimination of the program all together. Business groups also chimed in, arguing that they need the program to fill jobs Canadians won’t do.

The IRPP report says a TFW program of some type is indeed useful, since in some sectors of the economy, employers would need to raise wages considerably to attract workers, or shut down altogether, without having some degree of access to foreign labour.

However, a cap on the total number of foreign workers in Canada would facilitate ensuring that employers are actually using the program where labour shortages really do exist, and not merely to drive down wages, the report said.

Mr. Worswick is not alone in his concern regarding the rapid rise in the number of TFWs in Canada in recent years. A report from the Conference Board of Canada found that the numbers had more than doubled to some 360,000 today, just during the past 7 years. While Mr. Worswick’s own research pegs the number of TFWs at 213,000 (as of 2012); his numbers are also indicative of a near doubling since 2005.

“There are current and growing concerns that temporary foreign workers might take jobs from young Canadians just getting into the labour market, as well as those of lower-skilled Canadians,” the report says.

As you may recall, shortly after learning of the RBC controversy, the Harper government did tighten rules on employers exploiting TFWs. It also eliminated the “15% rule” that allowed employers to pay TFWs 15% below the median wage for the work in question, provided they had paid Canadian employees that rate as well.

Additionally, the government eliminated a “fast-track” TFW program, instituted a fee for companies applying for a TFW permit, and reinforced their own ability to revoke TFW permits if the program is abused.

However, Employment Minister Jason Kenney has suggested the fast-track program might come back, although supposedly this would only apply for high-paying, high-skilled jobs.

The IRPP report praised the Harper government’s changes, calling them steps in the right direction, however, added that policymakers should be looking at further reforms – chief among them being placing a cap on the whole range of TFWs admitted into Canada.

Research Resource: The Huffington Post Canada

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One thought on “IRPP: Temporary Foreign Workers Program – To Cap or Not to Cap?

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