Restaurants, retailers sound alarm over foreign worker cuts

By Mata Press Service

The Canadian restaurant and retail sectors are sounding the alarm over recent cuts to the Temporary Foreign Worker (TFW) program, citing potential devastating impacts on their industries already struggling to recover from pandemic-related challenges.

They argue that without access to this crucial labor pool, many businesses will struggle to remain operational, potentially leading to more closures and bankruptcies in an already fragile economic environment.

Some of the changes to the Temporary Foreign Worker Program (TFWP), already announced earlier this year, include limiting employers to hiring no more than 10% of their workforce through the program and limiting work permits for one year instead of two.

Additionally, TFWP applications from areas with unemployment rates above 6% will not be processed, barring exceptions.

The government is currently preparing to introduce a new Immigration Levels Plan in November, which is expected to further significantly reduce the number of temporary workers entering Canada.

The government maintains that the changes aim to lessen Canadian employers' dependence on the Temporary Foreign Worker program for filling job vacancies.

Immigration Minister Marc Miller told a recent Senate hearing that Canadian businesses have become "addicted" to temporary foreign workers.

Restaurants Canada, which serves as the national voice for the food service industry, foresees significant repercussions with the cuts to the TFWP.

The changes will cause more harm than good in those communities that have few other options to address labour shortages, it said.

While TFWs make up only 3% of our workforce, these workers have been vital in keeping many restaurants operational during challenging times, said Kelly Higginson, President & CEO of Restaurants Canada.

For over a year, Restaurants Canada has been advocating for a matching and training program to connect job vacancies in industries like food service (which currently has over 73,000 open positions) with the approximately 1 million unemployed newcomers holding open work permits in Canada.

“This proposal would benefit both businesses and newcomers seeking permanent employment opportunities,” said Higginson.

“We are deeply disappointed that our industry was not consulted in the lead-up to this decision…As a $115 billion industry and one of Canada’s largest private-sector employers, our voice is crucial in such decisions.”

The Retail Council of Canada (RCC) said the sweeping nature of the new changes will create problems for retailers and for Canada’s labour market.

Retailers use this program not to exclude Canadian workers but because in many locations they must do so because of an absence of Canadian candidates, said Diane Brisebois, President & CEO of RCC.

“In fact, most companies use temporary workers to complement their Canadian workforces and in turn that enables them to grow their businesses and the national economy,” she said.

“While we understand the government’s rationale for putting limits on the low wage stream of the TFWP, our concern is with the unintended policy consequences and the tight implementation timelines.

“Our members have raised many practical concerns, and they worry that in the short term this could result in layoffs, an inability to fill crucial operational roles, and potentially, in-store closures, with an overall loss of jobs, including those of Canadian workers.”

The RCC is urging Ottawa to consider targeted amendments to the announced program changes that will help mitigate the impact on retail workforces.

The Canadian Union of Public Employees (CUPE), the country’s largest union, with 750,000 members across the country, said “the series of troubling announcements over the last few months that will have a significant impact on temporary foreign workers, international students and their families.”

“As a union representing many workers under these programs, we join the migrant justice movement in Canada to demand justice and respect for all migrant workers.  We call on the Canadian government to reverse the changes, fix these exploitive programs, and stop blaming migrants for the government’s policy failures,” CUPE said.

Canada's Commissioner for Employers, Nancy Healey has also urged the government to maintain the number of workers admitted to the country under the Temporary Foreign Worker (TFW) program, improve processing times, simplify application processes and requirements, and provide the option of multi-employer work permits.

"Labour shortages persist and will continue in the next decade. More people are set to retire than enter the labour force. Canada's declining fertility rate leaves us with the lowest number of young people to enter the labour force and take on entry-level jobs," Healey said in a letter to cabinet ministers.

Her letter, supported by the Canadian Chamber of Commerce and the Canadian Federation of Independent Business, among others, reflects the concerns of the broader business community.

Sector after sector have raised alarm bells about labour shortages, said Healey pointing out that small businesses are facing a particularly acute problem.

Canada’s Temporary Foreign Worker Program began in 1973 as a way for employers to hire foreign workers for low-skill jobs.

According to public data from Immigration, Refugees and Citizenship Canada, 183,820 temporary foreign worker permits became effective in 2023. That was up from 98,025 in 2019 -- an 88 percent increase.

The top five jobs that saw the greatest number of TFW approvals last year were:

1. General farm workers - 81,500

2. Nursery and greenhouse workers - 15,400

3. Cooks - 12,000

4. Food service supervisors - 10,400

5. Food counter attendants, kitchen helpers and related support occupations - 8,300

 As Canadians express more concern over immigration, new data from the non-profit Angus Reid Institute finds Canadians support a reduced Temporary Foreign Workers program as they express concerns over its effect on the housing and job markets.

A plurality (43%) says the program is fine to continue after the changes implemented by the federal government take effect later this month. A further one in seven (14%) believe the changes were not necessary and the program was okay as it was. A minority of one in five (22%) believe the program should be abolished entirely.