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Finlayson Op-Ed: Temporary Foreign Workers: Facts and Fiction (Vancouver Sun)

Canada has a long tradition of attracting immigrants to become permanent residents.  Immigration in many ways built the country and did much to stimulate economic growth in the post-war era.  The context for international migration, however, is changing.  Greater international mobility, instant access to information from around the world, and growing cross-border flows of goods, services and knowledge have all made international migration a possibility for a rising share of the world’s population.  The result is an increase in the volume and types of movement of people between jurisdictions.  Today, this includes substantial numbers of “temporary” migrants who come to relatively affluent countries like Canada for work or education.

While Canadian immigration policy remains focused on permanent settlement, recent years have seen a noticeable jump in “temporary foreign workers” (TFWs).  At the end of 2011, the stock of TFWs in Canada stood at 300,000, up from 141,000 in 2005.  This trend reflects several factors: 1) the country’s aging population, 2) the existence of skill shortages in some occupations, 3) more general labour shortages in certain regions, 4) surges in labour demand occasioned by major project development in resource-related industries – particularly in Western Canada, and 5) a significant increase in intra-company transfers, research and other educational training and youth exchange programs. 

The presence of TFWs has sparked public debate. Having relaxed the rules to ease the entry of foreign workers a few years ago, by the spring of 2013 the federal government reversed course in the face of a handful of cases where critics asserted that TFWs were gaining employment at the expense of Canadians.   In April, the government toughened the rules for employers wanting to bring in non-permanent foreign personnel, with further changes in the TFW program expected later. 

This raises an interesting question: who is actually entering Canada under the TFW program?  A close look at the data suggests that the fears surrounding the program are exaggerated.    

Recall that by 2011, 300,000 TFWs were in the country.  Of these, 36,000 were here according to the provisions of international trade agreements to which Canada is a party.  This includes 22,000 individuals working in Canada under rules established by the North American Free Trade Agreement to facilitate labour mobility and the entry of business visitors and intra-company transferees.    

Some 65,000 foreign workers are in Canada as part of reciprocal employment arrangements with other countries, which by definition do not have any net impact on the labour market.  Here, the largest component is exchanges for young adults who can obtain one- or two-year visas to work in another country.  Britain and Australia are among the countries with which Canada has long maintained such reciprocity agreements.   These exchange programs provide young Canadians with opportunities to travel and gain cultural and work experience abroad.  In return, we offer similar opportunities to young people from other countries.     

Some 36,000 foreigners classified as TFWs are actually highly-qualified researchers working in advanced education and training as well as post-graduate students permitted to spend time in Canada (this group has seen the largest increase since 2005 owing to an explicit policy shift to make better use of their education and training).  These individuals make important contributions to Canadian research in health care and other areas of advanced technology.  Because the foreigners in this category  are entitled to be accompanied by their spouses while in Canada, this pushes up the number of TFWs by another 26,000.

Add it all up, and as of 2011 some 196,000 TFWs were deemed to be workers with “Canadian interests” or else entered via international trade and reciprocal exchange agreements. Just 104,000 of the TFWs  here were based on applications from Canadian employers seeking a positive “labour market opinion” (LMO) from the federal government.  This includes temporary foreign workers employed by mining and energy companies, restaurant and foodservice establishments, the construction sector, and tourism operators.  Also within the LMO group are 25,000 TFWs  under a program for “live-in caregivers” who look after children or provide assistance to disabled and elderly Canadians.  Another 24,000 TFWs are temporary agricultural workers that farmers depend on to harvest their crops and undertake other seasonal work.  In both instances, these are jobs that few Canadians want to take.

While it is legitimate to ask to what extent public policy should allow Canadian industries to become dependent on pools of TFWs to run their operations, the data indicate that temporary foreign workers do help employers address labour shortfalls and that, overall, they are making a useful contribution to the economy.  TFWs represent only a small portion of the broader labour market which consists of almost 18 million employed individuals.  This is especially given  that only one-third of TFWs are in Canada as a result of employers having obtained positive labour market opinions, and that half of these are  agricultural workers or live-in caregivers.

The reality is that future economic growth and steady increases in retirements will require Canada and many other developed countries to look to foreign sources of labour supply.  This will include both permanent immigrants as well as workers who come to Canada on a temporary basis.