Episode 03: Is Canada Facing a Perfect Storm of Rising Unemployment and a Housing Meltdown?

Send us Fan MailIn this episode, we dive into the big issues facing Canada’s economy and housing market: from temporary foreign workers (TFWs) and rising unemployment rates to the sharp decline in new condo developments. We explore the long-term impact on Canada’s workforce and housing, and how government policies are shaping the future of employment and real estate.Topics Covered:Canada Cutting Back on Temporary Foreign Workers (TFWs):Canada is reducing the number of low-wage TFWs to address high unemployment rates among immigrants and young people.Sectors with 6%+ unemployment won’t be allowed to hire TFWs, except for food security, construction, and healthcare sectors.TFW program changes include limiting TFWs to 1-year contracts and capping employers from hiring more than 10% of their workforce through the program.Unemployment Statistics:Newcomer unemployment at 11.6% and youth unemployment (ages 15-24) at 13.5%—the highest in a decade.A growing crisis highlighted by the UN calling Canada’s TFW program "a breeding ground for modern-day slavery."The Strain on Housing:Not enough housing for the influx of TFWs.Canada holds the highest number of TFWs in the G7, with job fairs overwhelmed by applicants struggling to find work.New Developments Dropping Off a Cliff:In July 2024, only 266 pre-construction condos were sold compared to a 10-year average of 2000 units.Appraisals are falling short, while development fees are rising. Burnaby, for example, increased development fees to $50K per unit after receiving $80M from the federal government for the Housing Accelerator Fund.The Future of Condo Development:Developers may shift to subscription-based models, building rental units instead of condos for sale to capitalize on easy, long-term revenue gains.Key Takeaways:Canada's TFW program is being scaled back to address unemployment, but the housing shortage for these workers remains a serious issue.New condo developments have hit record lows, with developers potentially shifting towards rental projects.Rising development fees and appraisals coming in short are further hindering real estate growth.Resources Mentioned:Arpan Khanna's video on the immigration crisis (MP for Conservatives in Oxford, ON)Watch on X (Twitter) Follow Our Hosts:Alex Pang Alex Shanks