Pierre Poilievre is back with a bang.
The opposition leader seized the national conversation last week by announcing a Conservative government would abolish Canada’s Temporary Foreign Worker Program.
The pushback was swift. Prime Minister Mark Carney came out in support of the program, stating employers say it is badly needed.
However, public opinion appears to be coalescing around Poilievre’s position. An Abacus poll taken after Poilievre’s statements shows some 44 per cent favour abolishing the program, and just 30 per cent still support it.
If Poilievre keeps at his message, you can expect more and more Canadians to come around to his view, for the simple reason that all the winning arguments are on his side.Â
While businesses today make it sound like they cannot function without temporary foreign workers, the reality is Canada has prospered without the TFW program for most of its history.
When first launched in 1966, the program exclusively existed to bring in seasonal agricultural workers. In 1973, it was expanded to permit the hiring of high-skilled foreign labour, and then in 1992, to permit families to bring in live-in caregivers. It wasn’t until 2002 that the program was changed to allow companies to bring in low-skilled workers at large.
Even then at its smaller size, the program was sufficiently controversial that then Bank of Canada governor Carney and then Liberal opposition leader Justin Trudeau argued against it.
However, during the pandemic years, the Trudeau government dramatically expanded TFW admissions at the urging of companies.
Whatever role it may have played in the past, current conditions make it blindingly clear this program now undermines the government’s stated goals of boosting employment, workers’ incomes and productivity.
The surge in low-skilled labour is showing up in the elevated youth unemployment rate, which has reached a 15-year high excluding the pandemic years. We already have a crisis of faith in the system among young people; governments suppressing their employment prospects does not help.
While temporary foreign workers might constitute a small percentage of the labour force, their numbers are concentrated in low-wage positions — distorting that specific part of the market. As well, prices are set on the margin, meaning even small changes in supply and demand can have a dramatic effect on the price. In this case, a small change in the supply of labour could have a material effect on wages.
Then there’s the affordability crisis, which remains a pressing issue for low and middle-income Canadians. Recent polls indicate cost-of-living has returned to being the number one voter concern, ahead of the Trump administration.
Eliminating the low-wage worker stream would also help mitigate this crisis. Many companies that have been able to avoid raising wages due to cheap foreign labour would need to now offer more, putting more money into the pockets of Canadian workers.
Companies have complained that workers are not willing to move to remote Canadian locations. The throngs of Newfoundlanders who moved to Fort McMurray, Alta. — one of the most inhospitable locations in the country — during the oil boom puts a lie to this notion.
Finally, there is Canada’s productivity crisis. Recent Statistics Canada data show productivity actually declined in the most recent quarter, which comes on the heels of years of declining productivity growth. Economists have attributed flagging productivity growth to factors such as low capital and technology investment.
Here, too, eliminating the TFW program could prompt necessary change. Companies confronted with the options of dramatically raising wages, closing shop or making capital investments might finally start to make investments — not because policymakers keep telling them they should, but because they must to survive.
So those are the reasons for getting rid of low-wage temporary foreign workers. On the other side of the ledger, it is hard to conjure up even a single compelling argument for allowing the low-wage TFW program to remain in place.
Governments, after all, exist to serve their citizens — not companies, not foreigners. The arguments one could make — and one hears some academics, industry groups and pundits making — for keeping the status quo are about serving the latter two, at the expense of the former.
For better or worse, Carney has shrewdly adopted many of Poilievre’s popular policy proposals. Adopting this one would be for the better.
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