Oil downturn could weaken Alberta’s case for TFWs

Falling oil prices could make it more difficult for Alberta businesses to defend their use of temporary foreign workers in 2015, one labour expert says.

And even the provincial government — which until now has argued strongly in favour of the TFW program as a short-term solution to Alberta’s labour woes — can be expected to “quietly shift away” from the issue if the value of crude remains depressed.

Jason Foster — the co-ordinator for Athabasca University’s industrial relations program — said the Alberta government could wind up with a public relations problem if it tries during a period of economic uncertainty to go to bat for employers who want TFWs. He said if the low crude prices of today translate into oilpatch layoffs in 2015, the merits of a low-skilled foreign labour stream will become an even tougher political sell.

“This is a political problem for the Prentice government,” Foster said. “I think they’re going to have to tread far more carefully in their rhetoric … I don’t think we’re going to see them — trumpets blaring — roll their forces into Ottawa to change the temporary foreign worker program.”

In June, the federal government announced a series of reforms aimed at reducing the number of low-skilled temporary foreign workers coming into Canada. The reforms were criticized by Alberta business groups who warned of long lines, reduced hours of service and even closures if employers cannot find the staff they need.

The Alberta government sided with the business community, with then Jobs minister Kyle Fawcett warning the changes could have a “lasting and negative” impact on the province. Premier Jim Prentice, during his summer campaign for the Progressive Conservative leadership, pledged repeatedly to work with the federal government to find a solution — something that would recognize the unique labour challenges stemming from Alberta’s red-hot economy.

No one from the provincial government was available to comment this week. But Foster said the province is facing a different economic story in 2015, something that could reframe the TFW debate by heightening public scrutiny of the already controversial program.

“If we start to see significant job losses, we will see tensions rise between Canadians who are out of work and their perceptions of temporary foreign workers who are quote-unquote ‘taking jobs’,” he said.

While one might assume an economic slowdown would translate into fewer TFWs working in Canada, that hasn’t been the case historically. A study published by Foster in 2012 found that from late 2008 to early 2010 — a period of recession and rising unemployment — the TFW program didn’t slow significantly, it simply levelled off. In both 2009 and 2010, new TFW entries nationally numbered around 180,000 — slightly lower than in 2008 but higher than any other year since the program’s inception. The total number of TFWs present in Canada also stabilized at around 280,000, the highest numbers up to that point and at a time when the Canadian economy was still shedding jobs.

The story is similar in Alberta, where the total number of TFWs working in the province was higher during the 2008-2010 downturn than it was in the boom years of 2006 to 2007. Part of that can be attributed to a lag effect — TFWs with valid permits are allowed to remain in Canada for one or two years, even if they have no work.

But Foster said even at the height of recession, it’s apparent employer demand for new TFWs did not dry up completely. And many employers who were already using TFWs sought to renew those contracts, in spite of rising domestic unemployment.

Gil McGowan, president of the Alberta Federation of Labour, said he expects that pattern to continue if the economy slows in 2015. He said employers in the low-wage service sector, particularly, will likely continue to resist efforts to reform the TFW program. That sector saw a significant drop in TFW permits between 2008 and 2009, but rebounded faster than other sectors such as trades and transport.

“For those (food service and accommodation) employers, their opposition to reining in the program was never about labour shortages or skills shortages,” McGowan said. “Their main goal was always to keep the program so they could use it as a tool to drive down wages. That’s a goal for them, whether oil is selling at $100 a barrel or $40 a barrel.”

But Richard Truscott, Alberta spokesperson for the Canadian Federation of Independent Business, said what happens in the oilpatch doesn’t necessarily have an impact on the small business community’s ability to find labour. Someone who loses a six-figure energy industry job isn’t likely to uproot their family and move to a rural Alberta community to work at the local burger joint or coffee shop, he added.

Truscott said the CFIB will continue to advocate for long-term immigration reform, pushing for a path to permanent residency for the TFWs many employers have come to rely on.

“What we’re facing is more of a structural long-term issue than just something that comes and goes with the cycles of the economy,” Truscott said. “We’re really facing a fundamental misalignment in the economy, between the jobs that are available and the Canadians who are willing and able to do them.”

astephenson@calgaryherald.com

Twitter.com/AmandaMsteph

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