Some employers have complained backlogs have hobbled the immigration system and made it unable to respond nimbly to demand for foreign workers in higher growth sectors such as video-gaming and the oil patch.
Finance Minister Jim Flaherty said on Thursday Canada now plans to return almost all of the 300,000 foreign skilled worker applications that were filed before Feb. 27, 2008, along with their $130 million in fees. Some have been waiting for one decade or more.
Flaherty made the announcement in his annual budget, saying the reforms would make the system faster and more efficient.
"We will ensure it is designed above all to strengthen Canada's economy. As a result, we will be better able to fill gaps in our labour force," Flaherty told the House of Commons in hisbudget speech.
It is an irony national unemployment is running at more than seven per cent while certain industries face labour shortages, but such employers may be looking for people with certain skills not found among most of the unemployed.
But someone who applied in 2001 may not have the skills needed in 2012, and if she was 42 when she applied would now be 53 and have fewer working years.
Canada has traditionally welcomed high numbers of immigrants. The country lets in 250,000 people per year and because of its below-replacement birth rate it will eventually rely on immigrants for any growth in its labour force.
It has a total backlog of one million would-be immigrants, about 460,000 of whom are skilled workers. Also in the backlog are applications by family members of recent immigrants, as well as investors and entrepreneurs.
The government allows 75,000 skilled workers to immigrate each year. In 2008, Ottawa started fast-tracking new applications by skilled workers but it quickly had to put a cap on those in order to be able to work through those still in the queue.
As a result of the measures announced on Thursday, it will be able to raise the number of applications it fast-tracks, with a planned eventual turnaround time of six months.
It had already told those in the backlog that they were welcome to withdraw their applications and reapply under the new rules. But if their skills are now in less demand, their chances of acceptance will also be lower.
The budget also announced somewhat less-developed plans to revamp the rules under which investors can immigrate. Previously, they were required to invest large sums of money with Canadian governments. But the intention now is to require them to invest directly in the economy.
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