Small businesses in Canada facing ‘big’ labour shortages

Allison Bamford reports on the factors contributing to the labour shortage in certain sectors, such as the service industry, for Canadian small businesses.

ESTEVAN and STOUGHTON, Sask. – As small Canadian businesses face big labour shortages, certain industries say caps on temporary foreign workers are adding to the staffing stress.

For the last few years, temporary foreign workers (TFWs) have helped Cristina Bohn fill staffing gaps for her Estevan, Sask.-based cleaning business in the southeast corner of the province.

But Bohn, who owns and operates Save the Stress Cleaning, stands to lose both her TFW employees in November when their work permits expire. She has an application in to hire another TFW, but she says that process could take a year.

More than 1.3 million TFW permits are set to expire by the end of the year, according to the Canadian Federation of Independent Business (CFIB).

“For businesses, that means that they will have to replace those workers and retrain somebody,” CFIB Prairies director Brianna Solberg said. “The hit to their productivity will be massive.”

Despite noticeable hiring challenges since the COVID-19 pandemic, Bohn says she has managed to expand her business since first opening in 2017.

“We’ve had 22 per cent growth every year,” she said. “But we need workers … we’re starved for people.”

Bohn has plans to expand her business and open a new laundromat. She says she needs to add 10 more staff members to keep up with demand.

She says she hires almost everyone who shows up for an interview. Hiring Canadians is her priority, but the line of work that she’s in can be hard to attract applicants and retain employees.

“To grow in a service industry, you need that person. You can’t just sell more product. You need to want to go out and do the work,” she said. “The only way for us to grow is to add more people.”

In 2024, the federal government placed a 10 per cent cap on the number of low-wage TFWs a Canadian company can hire. The cap is to ensure that Canadians and permanent residents are considered first for jobs.

Workers hired through the TFW program represent approximately one per cent of Canada’s workforce, according to the federal government.

In April, the cap will increase to 15 per cent for rural employers in eligible areas. The government says these are temporary measures, lasting until March 31, 2027, to help fill gaps in the rural labour market.

“Whether it’s retail, accommodation, trucking, agriculture, or health care, it’s just a matter of fact that we simply don’t have the numbers within our own domestic labour market to fill the roles that we need,” Solberg said, adding she’d like urban employers to also be eligible for the temporary measure.

Harder to hire in small towns: former owner

The Crossroads Inn in Stoughton, Sask., has been hiring TFWs for the last 20 years to help with staffing levels.

The current cap only allows the business to hire one TFW. The increase for rural companies could make the inn eligible for two TFW positions.

“I don’t know how they expect us to survive on that,” said Christine White, former owner of the Crossroads Inn.

“(The hospitality industry) has always suffered with staffing and because this is a small town in rural Saskatchewan, it’s even harder (to hire) than anywhere else.”

White sold the business to her son and daughter-in-law last year. She’s had to come back and help work when they are short-staffed.

She says a higher cap on TFWs would allow their employees to take more time off and keep the business from closing its doors when some employees are unavailable.

Provinces and territories will need to make a request to Ottawa for rural businesses to be eligible for temporary cap increase.

CTV News asked the Saskatchewan government if it plans to make the request. We did not hear back before the publication of this story.

Solberg says there is often a misconception that the TFW program is “cheap foreign labour.”

“Ultimately, these businesses have to actually pay more (for TFWs). They pay a fee to recruit these employees, and they have to do a labour market impact assessment, which costs money, too,” she said.