Temporary Foreign Worker Program changes in Canada
Canada Hints at Major Shifts Ahead for Temporary Foreign Worker Program
The Government of Canada is contemplating historic overhauls of the Temporary Foreign Worker Program (TFWP), the linchpin of the country’s immigration strategy for the labor market.
The program needs to be revamped such that it can respond more directly to regional and sectoral demands, Liberal caucus members were informed by Prime Minister Mark Carney on Tuesday in Edmonton.
New Financial Thresholds by Family Size
The adjustment is a 31.94% increase for individual applicants. For example, one must now have at least $10,507 in available funds, a rise from the previous $7,963. Settlement fund balances fluctuate with family size:
| Family Size | Required Funds (as of July 29, 2025) | Previous Requirement |
|---|---|---|
| 1 | $10,507 | $7,963 |
| 2 | $13,080 | $9,692 |
| 3 | $16,080 | $12,069 |
| 4 | $19,524 | $15,056 |
| 5 | $22,143 | $17,145 |
| 6 | $24,975 | $19,015 |
| 7 | $27,806 | $20,884 |
| Each additional member | $2,831 | $1,869 |
Closing Labour Gaps via Targeting
Carney emphasized future growth would move beyond universal coverage and actually ensure the program would prioritize the focus on “strategic industries” and industries with severe worker shortages. Though no information was released, ministers did confirm there are ongoing policy considerations and intentions for development that will more readily respond to regional labor demands.
The comments by the Prime Minister were made at a point when healthcare, agriculture, construction, and technology sectors were publicising their use of short-term foreign workers to plug the perennial gap in the workforce.
How the Program Functions Today
The Temporary Foreign Worker Program currently requires Canadian businesses to secure a Labour Market Impact Assessment (LMIA) before hiring foreign nationals. The Labour Market Impact Assessment, carried out by Employment and Social Development Canada, analyzes if it would adversely impact the opportunities for Canadians or permanent residents if a foreign worker were hired.
The employers are required to establish either that there is no qualified Canadian for the position or that the recruitment of foreign talent would help the national labour market. It is only through a favourable or neutral outcome of the LMIA that an overseas worker can apply for a work permit for Canada.
Political Background of the TFWP
The program has been politically criticized over the last few months. Rightwing politician Pierre Poilievre has argued that it reduces Canadian prospects and sustains stagnant wages. His party took it one step further and pressed for the termination of the TFWP because it framed it as a barrier to domestic employment.
Meanwhile, companies in more than one province claim the program is needed because otherwise many industries could not afford to stay competitive amidst recurring labor shortages and demographic issues like an ageing workforce.
Latest Government News
- Annual cap : Capping net new admissions for TFWPs for the year 2025 at 82,000.
- Regional restrictions: Suspension of the processing of short-term LMIA applications for the duration the unemployment rate exceeds 6%.
- Increased wage limits: Compelling the high-wage stream employers to pay at least 20% higher wages than the regional median wages.
- Fewer caps on the employer: Fewer limits on the proportion of the company's workforce that can consist of foreign guest workers.
- Spousal work permit limitations: Filling vacant work permits for spouses only for those associated with higher-skilled occupations and ensuring the lead worker holds a permit for at least 16 more months.
The Fall in Numbers
Government statistics reveal the effect of the changes. In the first half of the year 2025, the number of new work permits under the TFWP decreased by roughly half from the first half of the year 2024. In the first six months of the year, only 33,722 net new work permits were issued, further underscoring the program’s decline.
Current choices for English testing
Until the Torchmark-owned TOEFL Essentials is completely available, applicants can choose from the following IRCC-approved language tests:
Abilities in these tests are measured under the Canadian Language Benchmarks (CLB), which have a consistent level of English ability across immigration programs.
Metro Areas Now Ineligible for Low-Wage LMIA Applications
| Family Size | Minimum Required Funds (Annual) |
|---|---|
| 1 person (student only) | CAD $22,895 |
| 2 people | CAD $28,502 |
| 3 people | CAD $35,040 |
| 4 people | CAD $42,543 |
| 5 people | CAD $48,252 |
| 6 people | CAD $54,420 |
| 7 people | CAD $60,589 |
| Additional family member | CAD $6,170 |
These figures represent a significant increase from the earlier requirement of CAD $20,635 for a single applicant, which had been in effect since January 1, 2024.
Conclusion
Although the Prime Minister avoided providing timelines, immigration commentators believe the next round of changes will further restrict eligibility and focus the program on high-priority jobs. These changes are likely to be very carefully followed by both industry executives and interest groups focused upon preserving Canadian jobs for Canadians.
As the nation struggles to strike a balance of growth needed for the economy and indigenous employment interests, the controversy surrounding the Temporary Foreign Worker Program is going to be a constant for the nation’s immigration and worker policy.
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