The Canadian federal government is preparing a new round of reforms for its widely discussed Temporary Foreign Worker Program (TFWP). Speaking to the Liberal caucus in Edmonton on September 10, 2025, Prime Minister Mark Carney stated that moving forward, the TFWP “must have a focused approach that targets specific, strategic sectors, and needs in specific regions,” and confirmed that the government is actively working toward these objectives.

While the Prime Minister did not provide specific details on the nature of the potential changes, his announcement confirms the government's intention to continue recalibrating its foreign labour policy.

The TFWP is Canada's primary program for issuing work permits to foreign nationals. Its key mechanism requires employers to first obtain a Labour Market Impact Assessment (LMIA) before a foreign national can apply for a work permit. This assessment, conducted by Employment and Social Development Canada (ESDC), must demonstrate that hiring a foreign worker will have a neutral or positive effect on the Canadian labour market—ensuring that job opportunities for Canadian citizens and permanent residents are not diminished and may even increase as a result of the hire.

However, the program has long been a subject of debate. Opposition Leader Pierre Poilievre has recently targeted the TFWP with sharp criticism, claiming it has led to fewer job opportunities for Canadians. His Conservative Party of Canada has gone as far as calling for the program's abolition.

In response to political pressure and labour market considerations, the government has already implemented a series of measures over the past year and a half to scale back the TFWP. These include:

• Setting a net new admission target of 82,000 TFWP workers for 2025;
• Establishing a moratorium on processing low-wage LMIA applications in regions with an unemployment rate of 6% or higher;
• Raising the wage threshold for the high-wage stream of the TFWP to 20% above the median regional wage;
• Lowering the cap on the percentage of an employer’s workforce that can be hired through the TFWP; and
• Restricting eligibility for Spousal Open Work Permits (SOWPs) to spouses of TFWP holders in TEER 0 or 1 occupations, or select in-demand TEER 2 or 3 roles, while also requiring the principal applicant to have at least 16 months remaining on their work permit.

The effects of these tightening measures are already evident in official data. According to government figures, overall work permit issuances from January to June 2025 fell by 50% compared to the same period last year. During that time, only 33,722 net new TFWP work permits were issued, significantly below half of the annual target of 82,000.

Analysts believe that Prime Minister Carney's announcement signals that the government will now build upon these recent restrictions with more granular adjustments. Future policies may introduce more differentiated approaches to foreign worker recruitment based on the unique industrial structures and labour shortages of different provinces, aiming to strike a delicate balance between economic development needs and the protection of the domestic labour force. The specific details of the new policy are now being closely watched by all sectors.