Filling the labour gaps

Why relying on immigration as a quick fix for the skilled labour shortage may end up hurting immigrants and employers alike
Chris Bolin

Canadian employers will soon have to pay a $275 processing fee for every new staff member they want to bring in under the federal Temporary Foreign Worker Program. It sounds like a fairly token amount, and it’s meant to cover administrative costs, but the fee is really designed to discourage firms from being too eager to use the program as a ready source of cheap labour at a time when more than a million Canadians are looking for work.

It’s Ottawa’s latest effort to respond to the public outcry that erupted last spring when the Royal Bank of Canada outsourced some IT jobs to a foreign company, which then brought in temporary foreign workers to help move the jobs offshore. The controversy led to further questions about the program—namely, why it admitted 213,516 temporary foreign workers last year, more than three times as many as a decade ago. Even so, Ottawa has made no secret it views foreign workers—whether here on a temporary basis or permanently—as a key weapon to fight a looming labour shortage brought on by retiring baby boomers, as well as a growing skills gap that’s predicted to result in more than one million vacant positions by 2021.

In recent years, Canada’s immigration policy has put a bigger focus on bringing in people with specific occupational skills—everything from petroleum engineers to financial analysts—and has offered a greater role for provinces and employers in determining who gets admitted. More changes are on the way. By next year, Ottawa has promised to adopt a so-called “expression of interest” immigration model that will function as a sort of online dating service, matching would-be immigrants with firms looking to hire. Employers and provinces would be allowed to pick from a pool of applicants based on local labour-market needs. Selected applicants would then be approved through the immigration system.

While it sounds like an elegant solution to a pressing problem, it’s a controversial one among experts, who argue that relying on immigrants to fill vacant jobs isn’t nearly as straightforward as it seems. Indeed, it’s a policy Ottawa has tried in the past with little success. Immigrants, just like natural-born Canadians, are free to do what they want once they’re here, meaning there’s no guarantee they’ll stick with the jobs they were brought in to fill. Moreover, critics warn there could be a host of unintended consequences if immigration is treated as a way to create a job pool instead of the nation-building exercise many think it should be. “We can’t use the Temporary Foreign Worker Program like an immigration program,” says Jenna Hennebry, the director of the International Migration Research Centre at Wilfrid Laurier University. “And I don’t know that we can use the immigration program like an employment agency either.”

There were 82,765 economic-class immigrants granted permanent-resident status last year, another 27,541 family-class immigrants and 11,540 refugees. Though the exact mix fluctuates from year to year, there’s been a discernible shift in favour of economic-class immigrants since the late 1990s, largely at the expense of those immigrants being let in so they can be reunited with their families. But the numbers tell only part of the story. Within the economic-class category, Ottawa has become much more selective in the way it vets applications. Since January, it has placed a much higher focus on language proficiency, a key indicator of how well new immigrants will fare in the job market, and on professional skills that are equivalent to those sought in Canada. “We have traditionally been a country that just passively accepts applications,” Prime Minister Stephen Harper told Global News last December. “We are now trying to shape those immigration applications and process them in a way that will serve the labour-force holes that are emerging.”

It’s not the first time Ottawa has looked overseas to try to fill jobs. Up until the late 1980s, Canada’s policy for economic immigrants had been similarly occupation-focused. But it was later abandoned in favour of an approach that focused on more general attributes like education and overall experience. One reason for the shift, according to a paper co-authored last year by Ana Ferrer, an associate economics professor at the University of Waterloo, was that it was nearly impossible to get reliable labour-market data to determine where workers were actually in high demand. Just because employers claim they can’t find qualified workers doesn’t mean they don’t exist. The jobs themselves may be undesirable, pay too little or offer too few benefits. It’s a task that hasn’t gotten any easier given the decision two years ago to scrap the mandatory, long-form census. “I’m a bit worried about creating a system to respond to our labour market when we don’t have a system to identify real, acute shortages,” Hennebry says. She adds that Canada’s relatively high unemployment rate coupled with a growing number of job vacancies suggests a problem other than too few workers. “What we have are jobs that aren’t attractive to Canadians for a variety of reasons—everything from wages to health and safety.”

Not to mention proximity. It has always been difficult to direct immigrants to the parts of the country where they are needed most—many gravitate to Montreal, Toronto or Vancouver. The Provincial Nominee Program was created in 1998 to address this by letting provinces nominate potential candidates. But studies have shown a wide variation in the ability of provinces to retain new Canadians after just a few years, with Alberta and B.C. enjoying the most success and Atlantic Canada faring the worst.

A more troubling trend has been a three-decades-long decline in the performance of immigrants in the economy relative to natural-born Canadians. While new immigrants were twice as likely to be university graduates in 2006, they were also 2½ times more likely to be working in low-skilled positions like sales clerks or truck drivers, according to the study Ferrer co-wrote. Two of the oft-cited culprits for this trend are greater numbers of immigrants coming from parts of the world where French and English aren’t spoken, and the challenge of persuading employers to recognize foreign credentials. “I see all these medical doctors from China who have Ph.D.s and master’s degrees in medicine,” says Jean Wang, a career practitioner at the non-profit Centre for Newcomers in Calgary. “They come here thinking they are going to be a doctor. But that’s not true.”

Ottawa’s new “expression of interest” approach is supposed to overcome these failings. Because provinces and employers will only be picking those highly skilled economic immigrants they actually want to hire, it’s argued most will arrive here with good jobs waiting for them, speeding the integration process.

Those who work with new immigrants, however, say their poorer performance in Canada in recent decades is due to more than a lack of job opportunities. Amy Casipullai, the senior coordinator of policy and communications at the Ontario Council of Agencies Serving Immigrants, says many suffer because they are “racialized” and aren’t easily accepted into communities or the workplace. “The problem is that most government investment in employment programs is all focused on how to build a better immigrant rather than addressing some of these systemic issues,” she says, adding that well-adjusted new immigrants are far more likely to be successful economically. Others note that while the government is focused on using immigration to fill vacant jobs, federal budget cuts have simultaneously gutted many of the programs that are supposed to help these people settle into Canadian life.

The challenge, then, is balancing Canada’s appetite for qualified workers with the needs of immigrants themselves. Access to a good, high-paying job is important, but the key to solving the skills gap may be making sure new Canadians thrive in those positions. If not, the country’s labour woes will be that much worse.