Canada has long relied on international talent to fill labour shortages, and the Temporary Foreign Worker Program (TFWP) has been one of the most widely used pathways for hiring foreign nationals. However, in 2025, the Canadian government is reshaping the program in ways that directly affect both employers and migrants.
From stricter LMIA requirements to changes in wage thresholds, work permit caps, and spousal open work permits, the program is being restructured to better match Canada’s evolving economic priorities. If you’re planning to work in Canada or hire foreign workers, understanding these changes is crucial.
In this guide, we’ll break down:
- Why Canada is reforming the TFWP
- The latest rules around LMIA and regional restrictions
- Wage thresholds and workforce caps employers must follow
- New limitations on spousal open work permits
- Political debate surrounding the program
- What these changes mean for workers and companies
Let’s dive in.
Why Is Canada Restructuring the Temporary Foreign Worker Program?
Canada is facing a balancing act. On one hand, critical labour shortages in industries like agriculture, healthcare, hospitality, and construction require a steady flow of foreign workers. On the other, rising unemployment in certain regions and political pressure have forced the government to tighten control of the program.
Prime Minister Mark Carney, speaking at the Liberal caucus in Edmonton on September 10, 2025, made it clear:
“The program must have a focused approach that targets specific, strategic sectors, and needs in specific regions.”
This shift signals that the TFWP is no longer a blanket solution for employers across Canada. Instead, it will be sector-specific, region-specific, and need-based.
Labour Market Impact Assessment (LMIA): Tighter Rules
At the heart of the TFWP is the Labour Market Impact Assessment (LMIA). Employers must prove that hiring a foreign worker will not negatively impact the Canadian labour market.
In 2025, the LMIA process has become stricter than ever:
- Moratorium on low-wage LMIA processing in regions with unemployment rates above 6%. If local workers are available, employers can no longer bring in foreign staff for lower-wage positions.
- Target admissions set at 82,000 new TFWP workers for 2025. This is a controlled intake designed to limit reliance on foreign labour.
This means employers in high-unemployment regions face more hurdles, while workers seeking low-wage roles may find opportunities shrinking.
Stricter Wage Thresholds
To prevent foreign hires from undercutting Canadian wages, the government has raised the wage threshold for high-wage positions to 20% above the regional median wage.
This policy aims to:
- Protect Canadian workers from being replaced with lower-cost labour.
- Ensure foreign workers are only brought in when truly necessary.
- Push employers to offer competitive pay if they want access to the TFWP.
For example, if the median wage in Ontario is CAD $28 per hour, a high-wage TFWP role must now offer at least CAD $33.60 per hour. This makes foreign hires a costlier but more deliberate investment.
Workforce Caps for Employers
Another major change is the cap on how many foreign workers an employer can hire through the program.
- Employers are allowed only a limited percentage of their workforce to be on TFWP permits.
- Caps vary by industry and region, with stricter rules in sectors like retail, food services, and hospitality.
The goal is to encourage companies to prioritize Canadian hires and avoid becoming overly dependent on foreign labour.
For small and medium-sized businesses in struggling industries, this could mean a serious workforce shortage unless they adapt recruitment strategies.
Spousal Open Work Permit (SOWP) Restrictions
One of the most talked-about reforms is the restriction on spousal open work permits (SOWPs).
Until recently, spouses of foreign workers across most job categories were eligible for an open work permit, allowing them to work anywhere in Canada. Now, eligibility is limited:
- Only spouses of workers in TEER 0 or 1 occupations (management and highly skilled jobs) qualify.
- Some in-demand TEER 2 and 3 jobs (such as trades, healthcare support, or technical roles) are included, but eligibility is selective.
- The principal worker must have at least 16 months left on their work permit for the spouse to qualify.
This change directly impacts families who plan to move together. Many spouses will no longer have the freedom to work in Canada unless the primary applicant holds a high-demand, high-skill job.
Declining Work Permit Issuances
Recent data from IRCC (Immigration, Refugees and Citizenship Canada) and ESDC (Employment and Social Development Canada) shows how these changes are already reshaping the labour market:
- Between January and June 2025, work permit issuances dropped by 50% compared to the same period in 2024.
- Only 33,722 net new TFWP permits were issued in the first half of 2025.
This sharp decline indicates that fewer foreign workers are entering Canada, and employers will need to look at long-term recruitment strategies rather than quick fixes.
Political Debate: Should the TFWP Be Abolished?
The TFWP has always been politically controversial. Opposition leader Pierre Poilievre of the Conservative Party has called for the abolition of the program altogether, arguing that it takes away opportunities from Canadian citizens.
Supporters of the TFWP argue that many industries—such as farming, caregiving, and hospitality—would collapse without foreign workers. Critics say companies use it as a shortcut instead of investing in local hiring and training.
The political heat suggests that more reforms could be coming in 2026 and beyond. Employers and migrants must be ready for further tightening.
What These Changes Mean for Employers
For Canadian employers, the new TFWP rules mean:
- Higher costs due to increased wage thresholds.
- Stricter limits on how many foreign workers can be hired.
- Slower hiring due to more complex LMIA processes.
- Regional disparities where hiring foreign workers may not even be possible in high-unemployment zones.
Employers will need to:
- Explore automation and technology to reduce labour dependence.
- Build stronger pipelines for local recruitment and training.
- Use the TFWP strategically only for critical roles.
What These Changes Mean for Migrants
For migrants hoping to work in Canada, the new reality is:
- Fewer permits available as the government restricts overall numbers.
- Tougher eligibility with stricter wage, skill, and occupation requirements.
- Reduced family opportunities due to spousal permit restrictions.
- Higher competition for limited TFWP spots.
However, Canada remains one of the most attractive destinations globally due to its:
- Strong job market in specific sectors (like healthcare, tech, and construction).
- Pathways from temporary work to permanent residency.
- Quality of life and social benefits for those who qualify.
Migrants will need to carefully research in-demand roles and align their skills with sectors facing genuine shortages.
Final Thoughts
The Temporary Foreign Worker Program has been a lifeline for Canadian industries and an opportunity for thousands of migrants each year. But in 2025, it’s undergoing its most significant transformation in years.
By tightening LMIAs, raising wage thresholds, capping workforce numbers, and restricting spousal permits, the government is signaling that the TFWP will be reserved for high-need sectors and high-skill roles.
For employers, this means adapting hiring strategies and relying less on foreign labour for low-wage positions. For migrants, it means carefully planning your career path to align with Canada’s economic priorities.
As the political debate intensifies, one thing is clear: the TFWP will continue evolving, and staying informed is the best way to navigate its challenges and opportunities.
