The Relationship Between Unemployment Rates and Immigration in Canada

With unemployment rising in Canada, we wanted to share some information about the direct impacts the unemployment rate can have on newer residents in Canada.  

Key Takeaways 

• If the unemployment rate in your area is above 6% and you aren’t working in an in-demand profession, employers can’t hire you through an LMIA—no matter how qualified you are or how much they want to. 

• With fewer employers hiring, and even fewer willing to support immigration paperwork, landing a job that leads to PR is more challenging in a high-unemployment economy. 

• In some provinces, temporary residents must work a minimum number of hours to access public healthcare. Losing your job could also mean losing your health coverage. 

Unemployment Rate Impact on Temporary Resident in Canada 

LMIA-Access Tied To Local Unemployment Rates  

An Labour Market Impact Assessment (LMIA) is a document that shows an employer in Canada needs to hire a foreign worker because no Canadian worker is available to do the job. But in 2024, Service Canada began linking LMIA eligibility to local unemployment rates. If unemployment in a region rises above 6%, employers in that region cannot receive a positive LMIA—unless the job falls into a very limited number of exceptions. 

The exceptions apply to certain employees working in in-demand industries, like healthcare, food manufacturing, agriculture, and construction. There are also some administrative exceptions, such as for those LMIAs only obtained to support a permanent residence application or for positions that are temporary (like travelling carnivals). 

Regions with Higher Unemployment in Canada 

Here’s the government data on unemployment rates for LMIA-processing purposes: 

That means if you’re living in or moving to one of these high-unemployment regions, you may be shut out of LMIA-based work permits—even if an employer wants to hire you. Remember that there may also be additional restrictions in Quebec, since the province has its own immigration processing restrictions in place.  

Unemployment & Access To Healthcare in Canada (Temporary Residents) 

Access to healthcare is also a consideration for some temporary residents in Canada. While access to the publicly-funded healthcare in Canada as a temporary resident varies across the provinces and territories and depends on which type of temporary resident status you have, unemployment can mean you can’t access Canada‘s publicly-funded healthcare. This can mean that access to healthcare becomes quite expensive, even for routine things like contraception, or minor incidents, like needing two stitches after slipping on an icy pathway.  

The key to overcoming this hurdle is to have adequate coverage that actually meets your needs (not just costs the least). We’d suggest checking out BestQuote for a comparison of quotes across a range of providers, or Cigna Global if you’re looking to buy a comprehensive policy before you come to Canada. Cigna Global best suits people who plan to stay in Canada for 4 months or longer.  

Check out our healthcare resources to learn more about provincial and territorial healthcare on temporary status – or just reach out directly to the health authority where you live.  

Want to Apply for PR? High Unemployment Can Slow That Down Too 

If you’re planning to apply for permanent residence (PR) through a Provincial Nominee Program (PNP), a full-time job offer is often a key requirement. But guess what? When unemployment rises, employers are less likely to hire. Fewer roles mean fewer opportunities to get a full-time job offer, which reduces your access to many of Canada’s PNPs.  

To add to this, asking your potential employer to not only hire you but also to support your immigration application can be an obstacle to you finding work in the first place.  

More People Are Competing for the Same Jobs 

This may seem obvious, but it’s worth stating: more people are competing for the same jobs. So whether you’re a permanent resident or a temporary resident in Canada (or even a Canadian citizen, higher unemployment means higher competition. This has quite a few broad impacts on your job opportunities and quality of life in Canada.  

The first impact is that, even if you’re not relying on an LMIA, the rising unemployment rate still makes it harder to find work. Why? Because you’re now competing with more people—many of whom already have Canadian experience, networks, or language skills. 

This hits newcomers especially hard. Data shows that newcomers face higher unemployment rates than others in Canada. You might be up against people with local references or degrees that employers immediately recognize, while you’re still building your network and trying to “get your foot in the door.” 

The second is that increased competition can put downwards pressure on wages and reduce the ‘perks’ available to potential employees. It’s essentially a ‘sellers market’, with employers having more people to choose from.  

How To Stand Out in a Crowded Labour Market 

Here are our best tips for finding work in Canada despite the crowded labour market:  

Consider opportunities in lower competition regions 

Not everywhere in Canada is experiencing high unemployment. Places like Victoria (3.4%) and Halifax (4.8%) may have better opportunities and fewer restrictions. While these may not be your ‘dream’ location, you can always move there to gain experience, weather the storm, and if you want to move elsewhere later you can. (Though, you might be surprised with the quality of life in Canada’s smaller cities.) 

Keep your resume and LinkedIn profile updated 

Moving2Canada founder Ruairi is vocal about how the ‘spray and pray’ approach doesn’t work in Canada’s labour market. This means that if you have an ineffective resume that you just send to hundreds of job ads, you aren’t likely to succeed.  

Instead, he advocates for quality over quantity. Submitting thoughtful, tailored, and targeted resumes to positions you’re a good fit for at companies that you’d be valuable at is a better approach.  

But, this can be a huge undertaking. So, we recommend doing two things here:  

1. Carefully review our resume resources; and 
2. If you aren’t having luck, consider using a professional resume writing service like our partner, DocDoctor. You could have a Canada-based writer review your resume, LinkedIn and cover letter and get feedback and suggestions. Or you could even have it professionally written to help you stand out.  

Get serious about networking

Here’s our networking checklist: 

• Set clear networking goals. 

• Practice your elevator pitch until it feels natural. 

• Attend local meetups or online networking events. 

• Be proactive—don’t wait for someone to approach you. 

• Follow up with contacts after events (within 48 hours). 

• Stay active on LinkedIn, and engage with posts regularly. 

• Schedule coffee meetings or follow-up calls to deepen relationships. 

Get more information about our framework for networking in Canada. 

Finally, If you’re feeling the pressure right now, you’re not alone. Many newcomers are in the same position—trying to hold onto jobs, extend their stay, and keep moving forward in a system that feels like it’s always shifting. 

High unemployment makes it harder to build the life you imagined here. But understanding how the system works—and where the roadblocks are—can help you make informed decisions and take action early. 

Whether it’s finding work in another region, shifting your focus to an in-demand field, or planning a different PR strategy, there are many different ways through this. Don’t give up. Just get strategic.