Canada wastes skilled immigrant talent

Canada is leaving critical talent on the sidelines; at a cost it can no longer afford.

The Institute for Canadian Citizenship (ICC), a national charity focused on helping immigrants succeed and fully participate in Canadian life, has released a new report calling for urgent reform to how foreign credentials are recognized. Titled “Ready to Contribute: How a Fair Licensing Act Can Put Immigrants’ Talents to Full Use for Canada,” the report outlines how systemic barriers are preventing hundreds of thousands of skilled newcomers from working in their trained professions.

At a time when 6.5 million Canadians lack access to a family doctor, the findings land with particular urgency. It proposes a timely novel approach to ending the pervasive Foreign Qualification Recognition (FQR) barriers that keep hundreds of thousands of qualified immigrants from practicing their professions, costing Canada as much as $50 billion in lost economic potential every year.

The report argues that outdated and inconsistent licensing systems are actively harmful. Highly trained doctors, nurses, and other professionals are often forced into survival jobs while their credentials go unrecognized, even as the country faces severe labour shortages in essential sectors.

Daniel Bernhard, CEO of the ICC, puts it bluntly, “Keeping qualified immigrant talent on the sidelines while Emergency Departments routinely close due to staffing shortages is an epic triumph of self-defeat.” He adds that despite decades of awareness, the problem has only worsened, calling for a brand-new approach designed to succeed where past efforts have failed.

The numbers underscore the scale of the issue. Nearly 640,000 immigrant degree-holders in Canada are considered overqualified for the jobs they hold. That number would drop to approximately 270,000 if immigrants experienced the same employment outcomes as Canadian-born workers.

In healthcare, the gap is especially stark. Only 41% of internationally trained physicians and 37% of internationally trained nurses are employed in their respective fields. Closing this gap could add an estimated 16,000 doctors and 27,000 nurses and related professionals to Canada’s workforce.

Beyond the human cost, the economic implications are significant. The report estimates that FQR-related barriers drain up to $50 billion annually from Canada’s economy while further weakening already sluggish labour productivity.

Claudette Hepburn, CEO of Windmill Microlending, emphasizes the importance of the report’s findings, noting that it clearly outlines both the problem facing skilled immigrants who seek Canadian accreditation and the need for a solution.

That solution, according to the ICC, is a federal Fair Licensing Act (modelled in spirit after the Canada Health Act) that would standardize and enforce credential recognition across provinces and professions.

Key recommendations include:

• A Fair Licensing Act that incentivizes provinces to remove barriers and penalizes those that do not
• A Canada Fair Licensing Transfer tied to measurable performance outcomes
• Adjustments to Provincial Nominee Program allocations to reinforce compliance
• A dedicated division within Employment and Social Development Canada to produce an annual report to Parliament
• A Fair Licensing Act Secretariat to coordinate federal-provincial collaboration

Photo Courtesy of Nappy

The ICC argues that only a coordinated, national approach can resolve what has been a fragmented and long-standing issue. Notably, concerns about foreign credential recognition date back to at least 1966, yet overqualification rates among immigrants have continued to rise.

Since its founding in 2010, the ICC has positioned itself as a key advocate for newcomer inclusion. Its Canoo app provides free access to cultural institutions, resources, and settlement tools to help immigrants, and their families integrate into Canadian society.

Integration, the report suggests, must include opportunity. Until Canada finds a way to align its immigration strategy with its labour market realities, it risks undermining both.