Worker headcounts overestimate labour contributions

According to Statistics Canada’s (StatsCan) March 2024 Economic and Social Reports, a simple headcount of Temporary Foreign Worker Program participants may be misleading when determining labour contributions.

The report, which delves into the labour force engagement of temporary residents with paid employment in 2019, reveals that despite being an important supply of labour, many temporary workers work part-time.

The report estimates that in 2019, 27.5 per cent of temporary residents who had paid employment were “weakly attached” to the labour market. This figure is more than twice the share of all Canadian-born and immigrant workers, which stands at 13.0 per cent.

The report defines “weak” labour market attachment based on annual earnings being equal to or less than $7,500, which would be comparable to working five hours per week at the Canadian average wage. For many temporary residents working in low-wage jobs, this could mean working for 500 hours per year at $15 per hour.

According to StatsCan, the industry that uses the Temporary Foreign Worker Program (TFWP) the most in Canada is the agriculture, forestry, fishing, and hunting sector. In 2019, TFWs accounted for 18 per cent of the workforce in these sectors.

The report argues that while the number of work permit holders is valuable information, it is not a good indicator of the amount of labour being provided.