The federal government will reduce immigration targets for both permanent and temporary residents over the next two years to alleviate pressures on housing, infrastructure, social services and unemployment, Immigration Minister Marc Miller announced Thursday.
Under the 2025–2027 Immigration Levels Plan, permanent resident admissions will decrease from the previously planned 500,000 to 395,000 in 2025, further reducing to 380,000 in 2026 and setting a target of 365,000 in 2027.
“For the first time, the levels plan includes controlled targets for temporary residents, specifically international students and foreign workers, as well as for permanent residents,” Miller said.
The plan aims to reduce temporary resident volumes to five per cent of Canada’s population by the end of 2026. Measures include a cap on international students and tightened eligibility requirements for temporary foreign workers.
“While it’s clear our economy needs newcomers, we see the pressures facing our country, and we must adapt our policies accordingly,” Miller said. “These changes will make immigration work for our country so that everyone has access to the quality jobs, homes and supports they need to thrive.”
Population decline forecast
The reductions are expected to result in a marginal population decline of 0.2 per cent in both 2025 and 2026 before returning to population growth of 0.8 per cent in 2027, according to the government.
Despite the decrease in overall numbers, the plan focuses on transitioning more temporary residents already in Canada to permanent status. More than 40 per cent of anticipated permanent resident admissions in 2025 will be from those who are already in Canada as students and workers.
“These residents are skilled, educated and integrated into Canadian society,” Miller said. “They will continue to support the workforce and economy without placing additional demands on our social services because they are already established, with housing and employment.”
Economic immigration
The plan emphasizes economic immigration, with permanent resident admissions in the economic class reaching 61.7 per cent of total admissions by 2027, focusing on key labour market sectors such as health care and trades.
For employers and HR professionals, the shift may impact workforce planning and talent acquisition strategies, particularly in industries reliant on international talent. The government asserts that transitioning existing temporary residents to permanent status will help meet labour market needs without adding pressure to housing and social services.
The plan also aims to strengthen Francophone communities outside Quebec, with Francophone immigration targets representing 8.5 per cent in 2025, 9.5 per cent in 2026 and 10 per cent in 2027 of overall permanent resident admissions.
The government has implemented several measures to manage temporary resident volumes, including reforms to the International Student Program, tightening eligibility requirements for post-graduation work permits and limiting work permits for spouses of temporary residents.
“These changes will help provinces, territories and stakeholders align their capacities and allow the population to grow at a sustainable pace as we encourage institutions to do their part in better welcoming newcomers,” Miller said.
Canada’s population reached 41 million in April 2024, with immigration accounting for almost 98 per cent of this growth in 2023, 60 per cent of which was due to temporary residents.
According to the government, reducing the volume of immigrants will help alleviate pressure in the housing market, with the housing supply gap expected to decrease by approximately 670,000 units by the end of 2027.
