Carney Cuts Foreign Workers as Youth Face Record Joblessness

Carney slashes foreign worker permits as youth unemployment soars

On This Page You Will Find:

• Breaking details on Canada's dramatic foreign worker cuts targeting unemployment
• Exclusive analysis of how new restrictions affect 82,000 workers nationwide
• Conservative plan to permanently eliminate the entire TFW program
• Provincial leaders demanding immediate program cancellation
• Real impact on businesses struggling with critical labor shortages
• What these changes mean for Canadian youth facing 14.5% unemployment

Summary:

Prime Minister Mark Carney has announced sweeping cuts to Canada's Temporary Foreign Worker program as youth unemployment soars to 14.5% - the highest in years. With immigration set to drop from 7% to 5% of the population, new restrictions block low-wage foreign workers in high-unemployment regions while Conservative Leader Pierre Poilievre promises to scrap the program entirely. The changes come as nearly one in five Canadian teens cannot find work, sparking fierce debate between protecting Canadian jobs and filling critical labor shortages that keep businesses operating.

🔑 Key Takeaways:

• Canada will cut foreign workers from 6.5% to under 5% of population by 2026
• New moratorium blocks low-wage foreign workers in regions with 6%+ unemployment
• Youth unemployment has spiked to 14.5%, with teens hit hardest at nearly 20%
• Conservatives plan to permanently eliminate the entire TFW program if elected
• Work permit duration slashed from two years to just one year maximum

Maria Santos watched her coffee shop's morning rush with growing anxiety. Three of her best baristas had returned to the Philippines when their work permits expired, and despite posting job openings for two months, only one Canadian applicant had shown up – then quit after three days. Now, with new federal restrictions blocking her from hiring foreign workers, she's wondering if her small business in Winnipeg can survive.

Santos isn't alone. Across Canada, a dramatic overhaul of the Temporary Foreign Worker program is reshaping how businesses operate, while politicians battle over whether the system should exist at all.

Government Slashes Immigration Targets Amid Unemployment Crisis

Prime Minister Mark Carney has announced the most significant reduction to Canada's foreign worker program in decades, with immigration as a proportion of the population set to plummet from seven to five percent within just a few years.

"The Temporary Foreign Worker program has a role, it has to be focused in terms of its role," Carney stated, signaling a fundamental shift toward what he calls a "focused approach" that targets specific sectors and regions rather than broad labor market needs.

The changes aim to "ease the strain" on housing, infrastructure and social services – concerns that have become political flashpoints as Canadians struggle with affordability and access to basic services.

Sweeping Restrictions Take Effect Immediately

The federal government has implemented a series of dramatic restrictions that will fundamentally change how businesses access foreign workers:

New Employment Caps: Companies can now hire foreign workers for only 10% of their workforce in the low-wage stream, down from previous higher limits.

Shortened Work Terms: Maximum employment duration has been slashed from two years to just one year, forcing more frequent turnover and increased administrative burden.

Regional Unemployment Blocks: A complete moratorium now prevents processing of low-wage Labor Market Impact Assessments (LMIAs) in any region where unemployment exceeds 6%.

Wage Threshold Increases: The high-wage stream threshold has jumped to 20% above median wages, pricing out many positions that previously qualified.

The government has set a target of just 82,000 net new TFWP admissions for 2025 – a figure that Conservative critics say is already being exceeded at a record pace.

Youth Unemployment Reaches Crisis Levels

The policy changes come as Canadian youth face their worst job market in years. Statistics Canada data reveals youth unemployment has remained stubbornly high at 14.5% in August, with the situation deteriorating rapidly over the past three years.

The numbers paint a stark picture: overall youth unemployment has surged from 10% in 2022 to 14% by mid-2025. Most alarming, nearly one in five Canadian teenagers who want to work cannot find employment – a generation of young people watching opportunities slip away.

For policymakers, the connection seems clear: why import workers when Canadian youth are struggling to find their first jobs?

Conservatives Promise Complete Program Elimination

Conservative Leader Pierre Poilievre has gone far beyond the government's restrictions, announcing a plan to permanently scrap the entire Temporary Foreign Worker program if elected.

"Prime Minister Carney has failed to meet his own already excessive immigration targets and now he's on track to issue the highest number of TFW permits ever in a single year," Poilievre declared, framing the issue as government incompetence rather than economic necessity.

Conservative research claims Carney's government issued 105,000 new Temporary Foreign Worker permits in just the first six months of 2025. Despite the promised cap of 82,000 for the entire year, the Conservatives argue the Liberals are on track to issue more TFW permits than any government in Canadian history.

The Conservative position represents a fundamental philosophical shift: rather than reforming the program, eliminate it entirely and force businesses to hire Canadian workers at market wages.

Provincial Leaders Demand Action

The federal restrictions have found support among provincial leaders who see the program as contributing to broader social and economic pressures.

B.C. Premier David Eby has called for the complete end of Canada's temporary foreign worker program, stating bluntly: "The temporary foreign worker program is not working. It should be cancelled or significantly reformed."

Eby's reasoning reflects concerns shared by many provincial leaders: "We can't have an immigration system that fills up our homeless shelters and our food banks. We can't have an immigration system that outpaces our ability to build schools and housing. And we can't have an immigration program that results in high youth unemployment."

The premier's comments highlight how immigration policy intersects with housing affordability, social services capacity, and employment opportunities – issues that directly affect voters' daily lives.

Government Defends Record Amid Criticism

Immigration Minister Lena Diab's office has pushed back against Conservative claims, arguing that the data tells a different story than critics suggest.

According to government figures, only 33,722 net new TFWP work permits were actually issued between January and June 2025 – representing about 40% of the total number expected for the year. The government emphasizes that overall work permit issuances have fallen by 50% compared to the same period last year.

"Overall, 125,903 fewer new temporary workers arrived between January and June 2025 compared to January to June 2024," the Immigration Minister's office stated, arguing that the restrictions are already having their intended effect.

The discrepancy between Conservative claims of 105,000 new permits and government figures of 33,722 highlights how immigration statistics can be interpreted differently depending on what categories and time periods are included.

Business Community Fights Back

While politicians debate elimination or restriction, business leaders warn that scrapping the program entirely would devastate industries that depend on foreign workers to operate.

Dan Kelly, president and CEO of the Canadian Federation for Independent Business, called Conservative plans to permanently eliminate the program "ridiculous," arguing that politicians "know better" than to ignore regional labor market realities.

"If you're trying to hire someone in rural Saskatchewan to come to work in your quick service restaurant, it's unlikely that the unemployed kid from Toronto is going to move cross country," Kelly explained, highlighting the geographic mismatch between where jobs exist and where unemployed Canadians live.

His comments reflect a broader business community concern: even with high youth unemployment in major cities, many rural and specialized positions remain unfilled because Canadian workers either lack required skills or won't relocate for available jobs.

The Regional Reality Behind the Numbers

The unemployment threshold creating the most immediate impact is the 6% regional trigger that blocks low-wage foreign worker applications. This policy recognizes that labor markets vary dramatically across Canada – what works in Toronto's tight job market may not apply to rural Alberta or remote British Columbia.

However, the policy also creates new challenges. A restaurant in Vancouver might be unable to hire foreign workers due to regional unemployment rates, even if no local candidates apply for kitchen positions that require specific cultural cooking knowledge or language skills for ethnic cuisine.

Similarly, seasonal industries like agriculture, tourism, and fisheries often depend on workers willing to accept temporary, physically demanding positions that many Canadian workers avoid regardless of unemployment rates.

What Comes Next for Employers and Workers

For businesses currently employing foreign workers, the one-year maximum employment period creates immediate planning challenges. Companies that previously invested in training workers for two-year terms now face doubled recruitment and training costs, along with more frequent disruptions to operations.

The 10% workforce cap particularly affects smaller businesses in industries like food service, agriculture, and hospitality, where foreign workers often represent a larger percentage of staff due to local hiring challenges.

For foreign workers already in Canada, the shortened terms mean more frequent visa applications, increased uncertainty about long-term planning, and reduced time to establish roots in Canadian communities.

The Political Stakes

The Temporary Foreign Worker debate has become a proxy for broader questions about Canada's economic future, immigration levels, and social cohesion. With a federal election potentially on the horizon, each party's position reflects different visions of how Canada should balance economic needs with social stability.

The Conservative promise to eliminate the program entirely appeals to voters concerned about job competition and rapid demographic change. The Liberal approach of targeted restrictions attempts to address those concerns while maintaining business flexibility. The NDP and other parties face pressure to choose between supporting workers (both Canadian and foreign) and addressing voter anxieties about immigration levels.

Beyond the Headlines

While political rhetoric focuses on broad numbers and policy positions, the real impact plays out in thousands of individual situations: the Filipino caregiver whose family plans depend on a two-year work term now cut to one year, the Saskatchewan farmer who can't find local workers for harvest season, the Toronto teenager competing with experienced foreign workers for entry-level positions.

The challenge for policymakers is creating systems that address legitimate concerns about youth unemployment and social capacity while recognizing economic realities that make some foreign worker programs necessary.

As Canada navigates these competing pressures, the Temporary Foreign Worker program has become a test case for whether the country can maintain its economic competitiveness while ensuring opportunities for its own citizens – particularly young people entering the job market for the first time.

The debate reflects deeper questions about what kind of economy Canada wants to build and who should benefit from the prosperity it creates. With youth unemployment at crisis levels and businesses struggling to fill essential positions, finding the right balance has never been more critical – or more politically charged.