Immigration has been the driving force behind Canada’s labour supply for many years, but the immigration landscape has changed in recent years. It is shifting towards a two-step process that prioritizes individuals who first arrive as temporary residents before transitioning to permanent residency (PR).
This shift is partly due to the country’s evolving labour market needs and the desire to ensure that newcomers integrate successfully into the economy and society.
While this process offers several advantages, it also raises critical concerns about worker rights and the sustainability of the labour market in the long term.
On This Page You Will Find:
- Overview of Canada’s Two-Step Immigration Process: A breakdown of transitioning from temporary to permanent residency.
- Key Immigration Pathways: Detailed exploration of programs like Express Entry, PNP, and Canadian Experience Class.
- Labour Market Impact: How the two-step process meets workforce demands and supports regional economies.
- Challenges and Risks: Examination of exploitation concerns, domestic workforce impacts, and vulnerability in crises.
- Trends and Statistics: Insights into the growth of temporary foreign workers and their economic contributions.
- Policy Implications: Strategies for balancing immigrant integration with long-term workforce development.
During the 2010s, over four-fifths of the growth in Canada’s labour force came from immigration. By 2020, 67 percent of economic immigrants had Canadian work experience, up from 12 percent in 2000, driven by provincial programs and the Canadian Experience Class. While higher-skilled Temporary Foreign Workers (TFWs) have more pathways to permanent residency, lower-skilled TFWs transition at higher rates.
The Two-Step Immigration Process
The two-step immigration process involves two distinct phases:
Step 1: Temporary Status
In the first step, individuals come to Canada with a temporary status, allowing them to live, work, or study in the country. The main pathways for temporary status include:
- Work Permits through programs like:
- Temporary Foreign Worker Program (TFWP): Designed to address labour shortages in specific industries, such as agriculture or construction.
- International Mobility Program (IMP): Focuses on attracting skilled workers who can contribute to Canada’s economy, such as those on Post-Graduation Work Permits (PGWP).
- Study Permits for international students, who often work part-time during their studies and full-time during breaks.
- Visitor Visas, although these are less common for individuals aiming to transition to permanent residency.
Step 2: Permanent Residency (PR)
After gaining Canadian work experience, completing their studies, or fulfilling other requirements, temporary residents can apply for PR through various programs:
- Express Entry: Uses points to rank candidates based on age, education, work experience, and language skills.
- Provincial Nominee Program (PNP): Allows provinces and territories to nominate individuals with the skills and experience needed in their region.
- Canadian Experience Class (CEC): Targets temporary workers and international graduates with Canadian work experience.
- Family Sponsorship: Enables Canadian citizens and permanent residents to sponsor close family members.
This pathway is particularly advantageous for Canada because individuals with Canadian experience tend to integrate more successfully into the labour market and society than those who immigrate directly from abroad.
The Shift to a Two-Step Process
Several factors have influenced Canada’s move towards a two-step immigration system:
Labour Market Integration
Immigrants with temporary status often have higher initial employment rates and earnings than those who immigrate directly. Their Canadian work experience, education, and social networks make it easier for them to find jobs and adapt to the local culture.
Better Skill Matching
Employers can directly assess temporary foreign workers’ skills, work ethic, and cultural fit before offering them permanent positions. This improves the match between immigrant skills and labour market demands, benefiting both employers and employees.
Regional Economic Development
Temporary foreign workers often fill labour shortages in smaller communities and rural areas, contributing to economic growth and population stability outside major metropolitan centres like Toronto, Vancouver, and Montreal.
Critical Industry Support
Canada continues to prioritize specific industries that need skilled workers, such as high-end IT professionals and healthcare workers, such as family physicians and registered nurses, through targeted immigration streams. Due to their importance to the economy and public welfare, these critical occupations are often fast-tracked for permanent residency.
Risks and Challenges
While the two-step immigration process has many advantages, it also presents risks and challenges:
1. Worker Exploitation
Temporary foreign workers may face poor working conditions, including low wages, excessive hours, and unsafe environments. Since their immigration status is often tied to their employer, they may hesitate to report abuses for fear of losing their job and, consequently, their chance at permanent residency.
2. Impact of Domestic Workers
A large influx of temporary foreign workers could displace domestic workers, particularly in low-wage sectors like agriculture, hospitality, and retail. This influx may also put downward pressure on wages, affecting the livelihoods of Canadian workers.
3. Reduced Investment in Domestic Workforce Development
Relying on temporary foreign workers may reduce incentives for employers and governments to invest in education and training programs for domestic workers. Over time, this could weaken the local labour market’s ability to meet future skill demands.
4. Vulnerability During Crises
The COVID-19 pandemic highlighted the vulnerability of industries that rely heavily on temporary foreign workers. For example, disruptions in the flow of seasonal agricultural workers led to labour shortages and potential threats to Canada’s food supply chain.
Comparing Canada’s System to the US
Unlike the US, where employers are predominant in selecting economic immigrants, Canada maintains greater government control over the second step of the immigration process. This distinction helps mitigate some risks associated with employer-driven selection, such as labour exploitation and short-term hiring practices.
Trends and Statistics
The number of temporary foreign workers in Canada has grown significantly over the past decade:
- From 2011 to 2021, temporary foreign workers increased from 356,000 to 845,000.
- Study permit holders accounted for a substantial portion of this growth, with many transitioning to work permits through the Post-Graduation Work Permit (PGWP) program.
- In 2021, temporary foreign workers comprised 4.1 percent of all paid workers in Canada, up from 1.9 percent in 2011.
Despite their growing presence in the labour market, many temporary foreign workers earn less than the median annual income of Canadian workers. In 2021:
- Approximately 75 percent of temporary foreign workers earned less than $42,000 annually.
- About 50 percent of those holding only study permits earned $6,000 or less, reflecting their weak attachment to the labour market.
Canada’s two-step immigration process has become critical for meeting the country’s labour market needs, supporting economic growth, and ensuring newcomers integrate successfully. However, to sustain this system, Canada must balance the benefits of attracting temporary foreign workers with the need to protect their rights, invest in domestic workforce development, and address long-term labour market demands.
Careful management and policy adjustments will ensure that the two-step process continues to benefit both immigrants and Canadian society.
FAQ: Canada’s Two-Step Immigration Process
What is Canada’s two-step immigration process?
The two-step process involves individuals first entering Canada on temporary visas, such as work or study permits, before transitioning to permanent residency (PR). This approach allows newcomers to gain Canadian experience, making integration into the workforce and society easier. Programs like Express Entry, Provincial Nominee Program (PNP), and Canadian Experience Class (CEC) facilitate this transition.
Why has Canada adopted the two-step immigration process?
The two-step system addresses labour shortages while improving immigrant integration. Temporary residents bring skills and experience, often filling roles in critical industries like healthcare and IT. This model also allows employers to assess candidates directly, ensuring better skill matches, and supports population growth in smaller communities and rural areas.
What challenges do temporary foreign workers face in Canada?
Temporary foreign workers often encounter poor working conditions, low wages, and job insecurity. Tied work permits can prevent workers from reporting abuse for fear of losing their residency prospects. Additionally, economic reliance on temporary workers risks reducing investment in domestic workforce training.
How does Canada’s two-step process compare to the U.S. system?
Canada’s government plays a more active role in selecting immigrants during the PR stage, while the U.S. system is employer-driven. Canada’s model reduces risks like labour exploitation and short-term hiring practices, ensuring long-term economic and social benefits for immigrants and communities.
What role do temporary foreign workers play in Canada’s economy?
Temporary foreign workers fill crucial gaps in industries like agriculture, construction, and healthcare. They accounted for 4.1% of all paid workers in 2021. Many transition to PR, contributing to economic stability and growth, but they also face challenges like lower median incomes compared to Canadian workers.
