Experts have warned that Alberta, which accounts for 26% of the country’s employment growth, may face a shortage of up to 96,000 workers by 2023 due to the changes introduced in the Temporary Foreign Workers Program in June 2014.
Alberta’s unemployment rate stands at just 4.7% and it even has 100,000 workers from other provinces. With the new changes, the province stands to lose thousands of foreign-born prospective Canadians who have been working across various industries in the province. Alberta’s provincial minister of jobs, skills, training and labor, Ric McIver, has been advocating to increase the annual immigrant quota of the province, which reached its cap of 5,500 in November last year. Additionally, there is a backlog of 10,000 applications nominated by employers for permanent residency, leading to a pause on temporary workers being nominated by their employers.
Under the revised rules employers must cap their total foreign worker force at 10% of the company’s work force, with a $100,000 fine imposed on employers who fail to follow the new rules. This has shocked many of Alberta’s businesses that heavily relied on foreign workers and are now struggling to cope. About 15,000 foreign workers now face deportation despite abiding by the rules and having immaculate employment records. Most affected are low-skilled workers in the food service industry who would not stand much of a chance to qualify under the new federal Express Entry system.
The list of trades that will be severely affected by labor shortage in Alberta includes food service chefs along with crane operators and various engineering professionals. The fact that the food chefs will no longer be allowed to stay on may affect the food industry unduly hard.
It is estimated that the economic impact of the closing down of one restaurant business amounted to a loss of $336,000 to an Alberta rural community as a result of the loss of rent, sale of insurance, gas, and day-to-day amenities to the employees of the business. It is estimated that the total economic loss of denying immigration to 15,000 workers in Alberta may be up to $89 million.
Experts also warn that the new rules will impose a huge social-economic cost to Albertan economy, and both employers and workers are in dire need of a viable solution to the crisis they face. Even though the government has provided some reprieve in the form of a one-year bridging program for some temporary foreign workers, it is likely to only help professionals and not the lower skilled workers.
After years of praising the Temporary Foreign Worker program, Employment Minister Jason Kenney has suddenly slammed the door in the face of the program’s biggest user: the hospitality industry.
Statistics show that the Temporary Foreign Worker program has been gradually spiralling out of control. Despite initially being introduced as a ‘last resort’ program, one in five net new paid jobs created in Canada between 2007 and 2012 was filled by a migrant worker. Furthermore, the period between 2005 and 2012 saw a 140 per cent increase in the migrant employment rate. Even the business-friendly C.D. Howe Institute confirmed that the program has pushed up unemployment.
The statistical evidence has been around for years. The hospitality sector alone had 45,000 guest workers on the roll by 2012, with migrants making up 40 per cent of net new positions since 2009. A more convincing explanation for Mr. Kenney’s sudden change of heart was the damage the issue was doing to the government’s political base.
Economic conservatives, represented predominantly by the small business lobby, supported the TFW program as an effective way to reduce labour costs. Despite the availability of plenty of unemployed Canadians to fill positions, foreign migrants are continually hired since they usually lack the full legal protections available to Canadians and would do the work at a lower wage.
Mr. Kenney’s actions seem quite subjective: There is only a political, not economic, rationale for limiting the moratorium to the restaurant industry. Even as he announced the action, Mr. Kenney energetically defended the broader TFW program.
The solution to Mr. Kenney’s TFW dilemma lies in increasing permanent immigration and giving these workers the same rights Canadian citizens are afforded. However, this method would hardly prove popular among either of the two constituencies concerned: business lobbyists seeking cheap labour and social conservatives who want less immigration.
Source: The Globe And Mail