The Pros and Cons of Hiring a Temporary Foreign Worker in Canada
Updated: Feb 22
Canada's Temporary Foreign Worker Program has been controversial ever since its inception in 1973. Some people argue that it is necessary to fill gaps in the workforce, while others believe it takes Canadians' jobs. This blog post will look at the pros and cons of hiring temporary foreign workers in Canada. We will also discuss whether or not the benefits outweigh the cost for the Canadian economy and businesses alike.
The Pros of Hiring Temporary Foreign Workers
Hiring temporary foreign workers has a lot of benefits to both employers and the economy as a whole. Let's take a look at some of the pros:
Address skill shortages and fill labour gaps. With the Canadian workforce shrinkage in population, businesses find it harder to find qualified candidates for open positions. We recently witnessed the effect of immigration on our workforce during the last two years of the pandemic, where immigration was halted. Hiring temporary foreign workers in positions where there is no qualified Canadian to do the job helps keep Canadian businesses running smoothly. Which in turn, helps boost the Canadian economy despite its growing ageing population, expected to be 23 percent of its population by 2030, according to ESDP.
Decrease employee turnover. Incorporating the temporary foreign worker program into your staffing plan can lessen your turnover as TFW usually have a two-year contract with your company. In most cases, temporary foreign workers stay beyond their contact if they are satisfied with their work environment and the employers respect their rights. According to Financial Post, this decrease in turnover can save some companies an average of $22,279 in recruitment fees and lost productivity every year, where some businesses typically save $50,000 or more each year depending on the size of the company. Growing recruitment costs are putting a strain on small businesses. Cost rise when organizations get larger. Smaller companies with fewer than ten employees face the highest expenses (35 percent), while medium-sized firms with 100 to 999 workers have the lowest costs (3 percent).
Stay competitive in a tight labour market. According to Statistics Canada, the job vacancy is at an all-time high of 912,600 in the third quarter of 2021. The Canadian government's temporary foreign worker program is designed to manage short-term labour needs when no qualified Canadians are available to fill the positions. Leveraging global talents thru the temporary foreign worker program can increase your pool of candidates and access to skills that are not available locally. These give companies the best opportunities of finding qualified candidates that can help their company grow and scale effectively. Many Canadian companies and businesses are affected by the lack of available workers; this issue is expected to become even more prevalent as we face what could be one of the most severe labour shortages in Canadian history. This will be especially true for mining, construction, food service industry, tech and health care. The temporary foreign worker program can help fill the shortage of workers in a wide range of industries.
Access new markets. Temporary foreign workers can help businesses learn about new cultures and expand their reach into new markets. When organizations hire temporary foreign workers, they open themselves to new cultural experiences and opportunities. These workers can share their knowledge and experiences with the business, which can help them expand into new markets. An excellent example is hiring a Filipino programmer currently working in Singapore. Singapore dabbed as the silicon valley of Asia where big tech companies like Google, IBM, Microsoft, Stripe and Salesforce have extended their operation used foreign talents extensively to skyrocket its growth. Attracting these specialized foreign skills to Canada can bring expertise, experience and fresh perspective to Canadian companies unavailable locally.
The Cons of Hiring Temporary Foreign Workers
As with most things in life, integrating the temporary foreign working program into your hiring plan has some cons. Let's discuss it below.
Challenges in integrating into a new culture. The temporary foreign worker has a different understanding of workplace culture than their locally trained peers. They may not understand the unwritten rules of communication, or they might misinterpret a gesture or facial expression. They may also be unfamiliar with workplace management hierarchy, leading to tension in the workplace and decreased productivity. It is essential for businesses employing temporary foreign workers or the organizations helping these companies to have a plan in place to help TFW integrate into the workplace and community for this kind of hiring strategy to be successful.
Long and complicated process in verifying competencies, certification and licensing. Depending on the industry and position you will be hiring, the TFW might not be able to get a certification and license right away. Some might need Canadian experience as a requirement to apply for it, and this is especially true for companies planning to hire temporary foreign skilled trade and health care workers. Keeping these in mind can help employers keep their recruitment timelines and expectation in check. Planning and experience are key. If your organization does not have an in-house expert. Connecting to a government body or a reputable licensed foreign worker recruiter might be critical for your organization to use the temporary foreign worker program successfully.
Language barrier. Even if the temporary foreign worker is proficient in English, they will still have difficulties understanding the Canadian accent, pronunciation, and jargon. These go both ways, and local speakers will have difficulty understanding the foreign worker's accent and pronunciation. These might create frustrations for the TFW, employees and customers. Partnering with local colleges or training agencies to provide language training for TFW could go a long way in mitigating this potential obstacle.
Misconstrued perception. The temporary foreign worker program is often misunderstood, and it does not help that some bad apples tend to abuse it. Because of the complexity of the process, many are not aware of all the rules and regulations that the government has put in place before employers can hire temporary foreign workers. The employer hiring temporary foreign workers has to prove that they made every attempt possible to hire Canadians, and the position has to be justified as a temporary one. There are also restrictions on the number of temporary foreign workers a company can hire, to ensure Canadian workforce is prioritized. Employers planning to complement their hiring process with the TFW program might face resentment within their community, thinking the TFWs are stealing jobs from Canadians.
Whether or Not the Benefits Outweigh the Cost and Why
Despite some drawbacks to this system, it remains an essential part of our economy that helps keep Canadians employed. The pros and cons of hiring a temporary foreign worker in Canada can be debated, but one thing is clear: the Canadian workforce would suffer without these workers. If you're considering hiring a temporary foreign worker in Canada, contact us today and let's start planning how you can leverage global talents to strengthen your workforce.