Tasha Kheiriddin: Liberals stuck in vicious cycle of rising immigration and housing shortages (2024)

It’s a vicious circle with no end in sight, courtesy of the current Liberal government. Canada needs to build more houses, so it needs more construction workers. The Canada Mortgage and Housing Corporation reports a shortage of construction labour as one of three factors contributing to longer build times, and RBC’s assistant chief economist Robert Hogue predicts that Canada requires over 500,000 additional construction workers to build all the homes needed between now and 2030.

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The government’s solution? Bring in foreign workers to fill the gaps. And not just temporary workers, but potentially permanent ones. Last August, Immigration Minister Marc Miller announced Canada’s first-ever targeted selection program to expedite permanent residency for newcomers with critical trade skills and experience. Boom — in the first three months of 2024, admissions of permanent residents with trade skills like carpentry, plumbing, and electrical work jumped 29 per cent from the quarterly average for the previous year.If that pace continues, around 17,800 skilled construction workers will receive residency in 2024.

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Those workers, of course, need to live somewhere. And as permanent residents or eventually citizens, they will need homes for decades. But guess what? Housing starts aren’t up — they’re down. Way down. In Ontario, they have fallen to 2018 levels. Ontario urban housing starts in April dropped 37 per cent from the same month last year, and TD Economics predicts that housing starts nationally will continue to decline due to elevated construction costs and high interest rates. The same workers brought in to fix the housing shortage will thus contribute to the housing shortage, albeit through no fault of their own.

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And if you’re a residential construction company, what do you do? Try and cut costs. Since you can’t control interest rates and the price of materials, you look to what you can control: labour. The result: unions report that construction companies are sidelining Canadian workers in favour of cut-rate foreign workers, including more and more temporary ones. And they’re getting a helping hand from a change in the law made by — you guessed it — the federal government.

In 2016, the Liberals removed the requirement for companies to consult unions before hiring from abroad. This produced a significant shift in their labour force, according to an analysis by the Globe and Mail of Labour Market Impact Assessments (LMIAs) from 2014 to 2021. From 2014 to 2016, LMIA application forms required employers to indicate if a position was unionized and whether the union had been consulted about hiring a temporary foreign worker (TFW). If no consultation occurred, they had to explain why.

However, starting in 2018, those questions were removed from the forms, producing a surge in TFW recruitment. In 2023, companies were approved to hire approximately 5,300 construction helpers and labourers through the TFW program, an 800 per cent increase from 2019. In 2022, the government increased the permissible hiring limit through the low-wage stream from 10 per cent to 30 per cent of staff, and authorized the hiring of thousands of tradespeople, such as carpenters, welders, and drywall installers.

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Union reps have been raising concerns about this for years, to no avail. In March, Employment Minister Randy Boissonnault announced plans to reduce the number of TFWs — but excluded the construction and health care sectors.

Concerns about the displacement of Canadian construction workers by TFWs have also been raised in the building of the Honda Canada EV and NextStar plants. The union claimed that 180 local millwrights and ironworkers in Windsor were unemployed while foreign workers were being brought in. The federal Conservatives are now demanding transparency on six recent EV deals, worried that TFWs will be used for construction instead of Canadians.

The policy incoherence here is mind-boggling. The Liberals’ high-volume immigration, international student, and foreign worker policies created a massive demand for housing, which they have attempted to fix by bringing in more foreign workers, pushing down wages for domestic labour and thus making life (and housing) more unaffordable for everybody. They need to fix this, starting by respecting union workers and incentivizing Canadians to enter the trades rather than importing cheap labour.

Otherwise, their circle isn’t just vicious — it’s cruel for domestic tradespeople and foreign workers alike, who see that under this government, the Canadian dream increasingly is just a mirage.

Postmedia News

Tasha Kheiriddin is Postmedia’s national politics columnist.

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