Can Canada Trim Its Reliance on Foreign Labor?

To boil down the economy of labor for his university students, Mikal Skuterud often poses them a basic question: Would they prefer to graduate when jobs are scarce or when workers are scarce?

Agriculture in Canada has long relied on temporary foreign workers.Credit…Fabrizio Costantini for The New York Times

They mostly vote for a time of worker scarcity. Workers can benefit in a vast job pool through employers’ competition to attract them — with better wages, for example — though this dynamic varies across industries, said Professor Skuterud, a labor economist at the University of Waterloo in Ontario who specializes in immigration.

“Labor economists tend to see labor shortages not as a first-order economic problem that governments need to solve,” he said.

Instead, he said, they see them as “a blessing” for workers and job seekers.

In Canada, the government is on a mission to plug those labor gaps with foreigners, having set a goal of attracting 1.45 million immigrants between 2023 and 2025. Officials, in announcing the plan two years ago, framed it as imperative for Canada’s future prosperity and its ability to fund public services.

Canada’s immigration policy historically emphasized highly skilled workers. Its geographic isolation from countries facing emigration crises allows it to be selective about future newcomers.