Businesses concerned as Quebec pauses hiring certain temporary foreign workers

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Businesses say they are worried about Quebec’s decision to reduce the number of foreigners working in low-paid jobs in Montreal and are urging the government to “listen” to the concerns of certain sectors that are struggling to find workers.

Quebec Premier François Legault on Tuesday said applications to hire temporary foreign workers in Montreal for jobs that pay less than $57,000 a year — the region’s median salary — would be suspended for six months starting next month to “protect the French language” and limit the pressure of rising immigration on housing and other public services.

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Certain sectors, such as health, education, construction, agriculture and food processing, are exempted from the pause. But it is likely to worsen the situation for restaurants and retail industries that are already struggling to find people to operate on a daily basis, business groups say.

“Business owners use the temporary foreign workers program to hire workers when they aren’t able to find people (in Canada),” said Francois Vincent, a vice-president and head of the Quebec wing at the Canadian Federation of Independent Business (CFIB), which represents more than 97,000 small businesses.

“We will probably see an increase in labour shortages for small businesses and that’s going to have a domino effect and put pressure on prices … and the economy.”

Quebec made the announcement just days after the federal government said it is looking to refuse job applications made under the low-wage stream of the Temporary Foreign Workers Program (TFWP) across the country due to a rise in the “misuse of the program.”

Employment Minister Randy Boissonnault, in a statement on Tuesday, said he approved Quebec’s proposal and that the federal government would “closely monitor” the change in policy as it makes its “own determination about future changes to the TFWP.”

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Businesses can use the TFWP to hire foreign workers, but they often need to prove that they aren’t able to find a worker for that specific position in Canada. In order to do that, they must receive a federal government document called the Labour Market Impact Assessment (LMIA).

About 71,300 LMIAs were approved by the government in the first quarter, compared to 63,300 during the same period last year. Most applications were for farm workers, cooks, food-counter attendants, truck drivers and construction labourers.

Some groups, however, illegally sell LMIA-approved jobs at extremely high rates to foreigners who are either outside the country or are already in Canada and are looking for ways to boost their immigration score in order to transition to a permanent resident from a temporary one.

One government officer that processes LMIA applications anonymously told the Financial Post last month that there weren’t enough checks and balances in place to properly assess the applications. The federal government, though, said it has increased inspections in this area in recent years.

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Earlier this month, the TFWP was described as a breeding ground for slavery in a United Nations report.

Industry insiders say the demand for LMIAs has increased in recent years because recent changes to Canada’s points-based immigration system for skilled workers have made it tougher for prospective immigrants to qualify.

An LMIA-approved job provides applicants with extra points. As such, LMIAs are reportedly being sold at a higher price than before, ranging from $10,000 to about $70,000 in some cases.

The Canadian Chamber of Commerce, which represents 200,000 businesses, said it supports the government’s intent to address any misuse of the program, but said the program is important to many sectors that are genuinely facing a shortage.

“We urge governments to adequately listen to the concerns of employers, particularly from those sectors of the economy that continue to struggle to find the workers they need to operate on a daily basis,” Diana Palmerin-Velasco, the chamber’s senior director, said.

Overall, the percentage of people who enter Canada under the TFWP is still lower than other streams. There are about 2.8 million non-permanent residents in Canada, and about nine per cent of that group falls under the TFWP program, according to government data.

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About 42 per cent of the total number of non-permanent residents are students and 44 per cent include post-graduate work permit holders, spouses of students, students of exchange programs and others. The remaining five per cent are asylum seekers.

Legault said the pause would reduce the number of temporary foreign workers by 3,500 at the end of six months. He said the number of temporary residents in Quebec almost doubled between 2021 and 2024, to 600,000 people from about 300,000.

“I think we have to show the example,” Legault said when asked at a press conference on Tuesday about whether the six-month pause was just a “symbolic” measure. “Because we are putting a lot of pressure since almost a year ago on Justin Trudeau to reduce … the temporary immigrants controlled by the federal government.”

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