CHARLEBOIS: Time for Canadians to serve themselves

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The federal government’s recent overhaul of the Temporary Foreign Worker Program (TFWP) for food service has prompted predictable outcry from restaurant operators.

As of January 2025, new caps limit TFWs to just 10% of a food service business’s workforce — down from 20% or more in recent years — and shorten work permits from two years to one. But this policy shift is not punitive. It reflects an overdue economic recalibration.

Put plainly, the TFWP in food service has run its course.

This is a rational policy correction, not regulatory overreach. Youth unemployment in Canada, particularly among those aged 15 to 24, now stands at 14.2% — a sharp indicator that domestic labour is available but being overlooked. That’s roughly one in seven young Canadians looking for work but unable to find it. Meanwhile, the sector continues to rely heavily on imported labour for entry-level roles that, with the right conditions, could and should be filled by Canadians.

The TFWP was designed as a stopgap — an emergency tool for employers unable to find domestic workers. In many industries, such as agriculture and seafood processing, that rationale still holds. But in food service — particularly in urban and suburban markets — it has become something else: A structural labour strategy aimed at suppressing wages, lowering turnover, and sidestepping long-term investments in human capital.

The numbers tell the story. In 2021, according to Statistics Canada, about 140,000 temporary residents — many under the TFWP — were employed in accommodation and food services, accounting for 17% of all temporary foreign workers in Canada. That same year, foreign nationals represented roughly 10% of the overall food service workforce. In certain quick-service chains, the concentration was even higher, effectively displacing Canadian youth from traditional workforce entry points.

Between 2018 and 2023, employer approvals for low-wage food service positions through the TFWP surged more than 4,800%. This is no longer a temporary fix — it is institutional dependency.

The economic cost is subtle but significant: A generation of young Canadians has been pushed to the sidelines. Historically, more than one-quarter of Canadians began their working lives in food service or hospitality. These jobs have long served as a training ground for interpersonal skills, time management, and resilience — essential soft skills for the broader labour market. We’ve now outsourced that social utility to temporary labour.

This is not to dismiss the complexity of the restaurant sector. Since 2020, the number of food service establishments in Canada has dropped from more than 100,000 to about 87,000, reflecting the deep and lasting impact of the pandemic. Margins remain tight. Menu prices are rising.

But consumer behaviour hasn’t collapsed — in fact, it’s evolved. In 2025, according to Canada’s Food Sentiment Index released by Dalhousie University, Canadians are spending 39% of their food budget at restaurants (up from 37% in 2023), and average monthly per capita spending has hit $198 — a record.

The demand is there. Canadians are still showing up, despite rising costs. If operators are required to raise wages to attract local workers, evidence suggests diners will continue to foot the bill.

Still, labour costs are only part of the equation. Governments could provide relief by adjusting fiscal and regulatory pressures. Automation is another worthy option. But relying indefinitely on temporary labour to balance the books is poor economics.

The TFWP still has a role to play in select industries with clear recruitment challenges, but its use in food service — particularly in areas with ample domestic labour — should be phased out. Wage suppression is not a growth strategy. Neither is sidelining Canadian youth from their first real economic opportunity.

This is about building a more resilient, equitable and sustainable food service sector — one that serves Canadians and is staffed by them too.

— Dr. Sylvain Charlebois is the Director of the Agri-Food Analytics Lab at Dalhousie University and co-host of The Food Professor Podcast. He is currently a visiting scholar at McGill University in Montreal.