In a significant development, the Canadian government is set to introduce new regulations that will impact the recruitment of high-wage foreign labor by companies. According to a senior government official familiar with the matter, Employment Minister Randy Boissonnault is expected to announce changes on Tuesday that will require businesses seeking to hire workers from the high-wage category of the temporary foreign worker program to provide compensation that is at least 20% higher than the median wage in each province.
Presently, companies can offer salaries based on the median provincial wage to utilize the program, contingent on completing a labor market impact assessment to demonstrate the difficulty in finding Canadian workers for the roles. The upcoming adjustment in the form of a higher wage floor reflects the government's effort to control population growth, particularly following a surge in non-permanent residents in recent years.
Criticism has been directed at Prime Minister Justin Trudeau's administration due to the influx of newcomers contributing to significant population growth rates, straining public services and intensifying housing shortages. As the labor market experiences a gradual loosening since last year, the necessity for firms to rely on foreign labor is being questioned, especially given the unemployment rates in the country reaching 6.5% overall and 13.5% among younger individuals.
The federal government had previously restricted the use of temporary foreign workers in low-wage roles, capping it at 10% of a company's workforce with exceptions made for sectors facing challenges in recruitment. Analysis shows that truck drivers were the most common profession filled through the high-wage stream of the foreign worker program in the first quarter of this year, accounting for 15% of approved jobs.
For instance, in Ontario, where the median wage for the high-wage temporary worker program currently stands at C$28.39 ($20.57) per hour, the upcoming changes will see this threshold increase to C$34.07. The government official estimated that as many as 34,000 workers could be impacted by these changes, signaling a significant shift in the recruitment landscape for high-wage foreign labor in Canada.