Canada’s unemployment rate update triggers changes to temporary foreign worker program 

These changes, announced in January, 2025, will impact the processing of Labour Market Impact Assessment (LMIA) applications under the low-wage stream.

Employers and foreign workers must be aware of these new thresholds, as the unemployment rate in a region plays a key role in whether an LMIA application can be processed.

According to Immigration News Canada (INC), the changes to the TFWP affect LMIA processing. Since September 26th, 2024, LMIA applications have been paused in regions where the unemployment rate is 6% or higher, or if the wage offered is below the regional threshold.

The recent update of unemployment rates has impacted which regions are eligible for foreign workers, with the new rates determining whether or not employers can apply for foreign workers under the Temporary Foreign Worker Program (TFWP).

As a result of the latest data, seven CMAs have dropped below the 6% unemployment threshold, making them eligible for the low-wage LMIA stream. These include:

Employers in these regions can now proceed with LMIA applications for foreign workers, as their unemployment rates are now within the acceptable range for low-wage positions.

Conversely, some regions have seen their unemployment rates rise above the 6% mark, making them temporarily ineligible for LMIA applications.

Employers in these regions will need to consider alternatives for hiring workers until the situation changes.

In addition to the updated CMA unemployment rates, several key changes were made to the TFWP in 2024. For example, the refusal of LMIA applications now applies to CMAs with unemployment rates of 6% or higher. However, exceptions are in place for certain critical sectors, including agriculture, food processing, fish processing, construction, and healthcare.

Moreover, the limit on foreign workers has been reduced from 20% to 10% of the workforce in most sectors. Critical sectors can still hire up to 20% of their workers through the TFWP. These changes are intended to address labor shortages while prioritizing job opportunities for Canadians.

For employers, these updates open new opportunities in regions where the unemployment rate is lower than 6%. At the same time, employers in areas with higher unemployment rates will need to plan accordingly and be aware of the program’s restrictions. Foreign workers will also benefit from these changes, as regions with lower unemployment rates now offer better chances to secure work permits.

With the changing regional conditions, both employers and foreign workers are encouraged to stay informed to navigate the TFWP successfully.