Social Policy in Ontario

It spiked. Between January and June, 125,000 temporary foreign workers were admitted into the country; a 5-per-cent increase over the same period last year.

It wasn’t because businesses went on a hiring spree; Canadian job applicants were being turned away in droves. It wasn’t because the economy was growing; it has been anemic all year. And it certainly wasn’t because Canadians want more low-cost foreign labour pouring into the country.

Chris Alexander, who became minister of citizenship and immigration in July, did his best to explain the embarrassing surprise.

He urged Canadians to be patient, pointing out that the government’s restrictions didn’t kick into effect until July. “I’m not going to predict where we’ll be on the temporary foreign workers by the end of 2013, but almost certainly in a different place,” Alexander told a Globe and Mail reporter.

He is a reasonable minister and he’s making a fair request. But the reforms on which Alexander is hanging his hopes are so modest — and the pool of low-paid foreign workers is so huge — that it’s hard to envisage a sharp fall-off in the next two months.

Moreover, the rookie minister inherited some heavy baggage. His predecessor Jason Kenney threw open the floodgates to foreign workers, making it easy for employers to recruit abroad. The ready availability of low-cost foreign labour changed the dynamics of Canada’s job market in ways that can’t be quickly reversed.

It wasn’t until a couple of egregious abuses of the program made headlines — a Chinese-controlled mining company in British Columbia tried to bring in 200 temporary foreign workers, insisting it couldn’t find a single qualified Canadian and a major bank tried to lay off 45 information technology workers and outsource their jobs — that Kenney pledged to tighten up the rules. He said Ottawa would:

• Cancel a provision of the program that allowed employers to hire foreign workers at 15 per cent below the market.

• Charge a $275 per worker fee for using the program.

• Require employers to submit a firm plan to replace their temporary foreign workers with Canadian workers over time.

• Demand proof that companies are not using the program to outsource Canadian jobs.

There is nothing wrong with these changes. They are all sensible and overdue. But they are unlikely to choke off the inflow (which now exceeds 200,000 workers a year) or deter employers from recruiting in countries where Canadian wages look very attractive.

Economist Christopher Worswick of Carleton University just completed ananalysis of Ottawa’s policy changes for the Institute for Research on Public Policy. His conclusion: “They are a good start, but further reform is necessary to prevent excessive reliance on the program by Canadian employers. A cap on the number of temporary foreign workers permitted to enter Canada each year should be implemented to ensure the program does not grow too large while additional reforms are considered.”

He believes the wage structure for entry-level jobs is so badly skewed that it will take years to straighten it out. Firms that can’t get workers at the going rate normally have two choices; pay higher wages or invest in labour-saving technology. Ottawa gave them a cheaper option: Hire abroad.

Many employers have become so dependent on migrant workers that they would have trouble surviving if market forces were allowed to prevail.

This poses a delicate challenge for Alexander. If he chokes off the inflow of temporary foreign workers to give jobless Canadians a break, he risks being blamed for jeopardizing the viability of farms, restaurants, retirement homes, retail operations and small businesses. But if he does too little, he risks angering jobless Canadians; young people shut out of the workforce; their frustrated parents; immigrants who came to this country intending to stay and contribute; and voters troubled by the hollowing out of the labour market.

The minister can temporize for a few more months, hoping Kenney’s changes will produce the right results. But he’d better have a credible backup plan. His government will be judged on its ability to create jobs for Canadians.

< http://www.thestar.com/opinion/2013/11/05/no_letup_in_influx_of_foreign_workers_goar.html >