Canada’s Temporary Foreign Worker Program is changing fast: What employers and migrants need to know

The Canadian government is making significant changes to its Temporary Foreign Worker Program (TFWP), the primary route for employers to hire foreign nationals. These revisions come amid ongoing efforts to better align the program with specific economic needs and regional labour market conditions.

Over the last year, the program has undergone several adjustments, and further changes are in development to refine its scope and application.The TFWP currently requires employers to obtain a labour market impact assessment (LMIA) before a foreign worker can be granted a work permit. This process has been tightened with new restrictions aimed at reducing the program’s overall use, especially in areas where local unemployment is high.

These measures are part of a government initiative to focus the program on strategic sectors and regions with genuine labour shortages.Focused approach to sectors and regionsPrime Minister Mark Carney, speaking to the Liberal caucus in Edmonton on September 10, emphasised that the program “must have a focused approach that targets specific, strategic sectors, and needs in specific regions,” as reported by CIC News.

Although further details were not disclosed, the government’s intention to concentrate on areas with critical workforce demands is clear.Recent policy changes include setting a target of 82,000 net new TFWP admissions for 2025, reflecting a controlled approach to foreign worker intake. Additionally, a moratorium on low-wage LMIA processing has been introduced in regions with unemployment rates above 6%. This restricts employers in affected areas from hiring temporary foreign workers in lower-wage roles.Stricter wage thresholds and workforce capsThe government has also increased the wage threshold for high-wage positions, raising it to 20% above the regional median wage. This adjustment aims to ensure that foreign workers do not undercut local wages and that jobs are filled in genuine shortage areas.Employers are now subject to lower caps on the proportion of their workforce that may be employed through the TFWP.

These limits vary by industry and region but are designed to encourage companies to prioritise Canadian workers.Changes to spousal open work permitsNew restrictions also apply to spousal open work permits (SOWPs). These permits, which allow spouses of foreign workers to work in Canada, are now limited to spouses of workers in TEER 0 or 1 occupations and selected in-demand TEER 2 and 3 jobs. Additionally, the principal TFWP holder must have at least 16 months remaining on their work permit for the spouse to qualify.Declining work permit issuancesData from Immigration, Refugees and Citizenship Canada (IRCC) and Employment and Social Development Canada (ESDC) reveals a sharp decline in overall work permit issuances. Between January and June 2025, the number of permits issued dropped by 50% compared to the same period the previous year. In that timeframe, only 33,722 net new TFWP permits were granted.Opposition criticism and political responseThe TFWP has faced criticism from the opposition. Pierre Poilievre, leader of the Conservative Party, has argued that the program limits job opportunities for Canadians and has called for its abolition, as reported by national media.These recent reforms reflect a broader strategy by the Canadian government to refine the Temporary Foreign Worker Program in response to labour market dynamics, regional disparities, and political pressures. Employers and migrants are advised to closely monitor these changes to understand their implications fully.