Over the course of the past few years, the Liberal government overhauled Canada’s immigration policies and brought in record numbers of newcomers, before recently changing course.
Immigration, Refugees and Citizenship Canada (IRCC) made a substantial change to its immigration policies on Oct. 24 in announcing cuts to its target numbers of new permanent residents over the next three years. The country’s targets will fall from 500,000 new permanent residents in each of the next two years to 395,000 in 2025 and 380,000 in 2026. The target will decline further to 365,000 in 2027.
At a press conference on Oct. 24, Immigration Minister Marc Miller said the “aggressive” volume of immigration had “come with some challenges.”
Attitudes toward immigration in Canada have also soured. A recent Abacus poll indicates that 53 percent of Canadians view immigration negatively, believing that it is making the country worse off. This proportion is up 10 points since November 2023 and 17 points since July 2023.
How did Canada’s immigration policies loosen so rapidly, and what ultimately prompted the federal government to alter its approach?
Increasing Numbers
With developed Western countries like Canada facing falling birth rates, governments have increasingly turned to immigration as a way to maintain economic growth. IRCC’s annual report to Parliament in 2020 said that “in the context of low birth rates and its vital role in growing the working-age population,” immigration was needed to continue driving the country’s economy.When the COVID-19 pandemic hit in early 2020, lockdowns and travel restrictions led to Canada’s immigration rate falling to lows not seen since 1998. While Ottawa had originally planned to welcome 341,000 new permanent residents in 2020 under the 2020–22 Immigration Levels Plan, the same as in 2019, only 184,606 permanent residents were admitted.
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Minister of Immigration, Refugees and Citizenship Marc Miller rises during question period in the House of Commons on Parliament Hill in Ottawa on Oct. 9, 2024. The Canadian Press/Spencer Colby
In October 2020, then-Immigration Minister Marco Mendicino announced that under the 2021–23 Immigration Levels Plan, Canada expected to welcome 1.2 million newcomers over the three years, consisting of over 400,000 each year.
In November 2022, Ottawa announced a further increase, with the country planning to accept 465,000 permanent residents in 2023, 485,000 in 2024, and 500,000 in 2025. Then-Immigration Minister Sean Fraser said the updated targets would allow Canadian businesses to fill worker shortages and set the country on “a path that will contribute to our long-term success.” He said immigration would help “rebalance a worrying demographic trend.”
The number of international students also began rapidly increasing, with study permit holders totalling 621,600 in 2021, 807,260 in 2022, and 1,040,985 in 2023. Ottawa also in October 2022 temporarily lifted the 20-hour-per-week cap on work hours for international students in an effort to address labour shortages.
In addition, the number of work permit holders in Canada increased from slightly over half a million in 2021 to over 1.4 million by the end of the third quarter of 2024.
Overall, Canada’s population increased from 38 million in the July 2020 to an estimated over 41.7 million in October 2024. A July 2024 Statistics Canada report said 96 percent of the population growth in the second quarter of 2024 was almost entirely due to immigration.
Problems Emerge
Around the time Canada began increasing its immigration rates, inflation was also taking off due to the COVID-19 pandemic, disrupted supply chains, increased government spending, and higher energy prices. Inflation rose from 2.2 percent in March 2021 to a peak of 8.1 percent in June 2022, causing the Bank of Canada to subsequently raise interest rates from 0.25 percent in March 2022 to a high of 5 percent in July 2023.Housing prices became more unaffordable during this time, with the average asking rental price rising from $1,769 per month in September 2020 to $2,193 in September 2024, and the average home price increasing from $581,000 to $718,000 over the same period. Prices were exacerbated by rising immigration, as Canada’s housing supply was unable to keep up with demand.
In September 2023, the Canada Mortgage and Housing Corporation (CMHC) said Canada will need to produce approximately 3.5 million additional homes by 2030 in order to meet the demand for housing and restore affordability. A February 2024 CIBC report said the housing gap could be as high as 5 million, as CMHC used a population figure of around 38 million when crafting the estimate, and Canada’s population had since surpassed 41 million.
IRCC warned the federal government back in 2022 that Canada’s population growth had “exceeded the growth in available housing units,” The Canadian Press reported in January 2024 based on documents it obtained through an access-to-information request.
When asked about the report, Deputy Prime Minister Chrystia Freeland said immigrants are a “real driver” of Canada’s economic growth and that they are needed at a time when Canada is facing demographic challenges.
Although Canada’s economy in recent years has avoided a recession—defined as two consecutive quarters of negative GDP growth—some economists have pointed out that’s because of high immigration numbers driving up consumer demand, and that looking at per-capita figures tell a different story.
A construction worker makes his way through a work site in Ottawa on June 27, 2024. The Canadian Press/Sean Kilpatrick
Canada’s economy saw zero growth in the fourth quarter of 2023 and just 0.4 percent in the first quarter of 2024. A July 2024 Royal Bank of Canada (RBC) report said Canada avoided a recession in early 2024 because of high immigration numbers. The RBC report said Canada’s “surging population growth” increased consumption and prevented an outright decline in GDP, while noting that unemployment was rising at a rate that “historically only happens in recessions.” Meanwhile, GDP per capita declined in six of the past seven quarters to 3.1 percent below 2019 levels, RBC said.
In August and September 2024, Canada’s immigration system once again came under scrutiny with MPs raising concerns about security screening processes after two separate instances where police thwarted terrorist attacks by individuals who had been permitted entry into the country. In July, RCMP arrested a father and son for being in the “advanced stages of planning a serious, violent attack in Toronto.” The father was arrested weeks after receiving Canadian citizenship in May. The son was granted refugee status in July 2022.
Then in September, a Pakistani national living in Toronto was arrested for allegedly plotting to carry out a mass shooting targeting Jews in New York City. Immigration Minister Miller said at the time that the man entered Canada on a student visa in June 2023.
The Reversal
Throughout 2023 and 2024, several elected officials began criticizing Canada’s immigration rates. Ontario Premier Doug Ford in August 2023 blamed Ottawa’s policies for his province’s housing crisis. Conservative Leader Pierre Poilievre, who had put housing affordability at the centre of his economic message but had previously been hesitant to discuss its links to high immigration, changed his tune in the summer of 2023.In August 2023, Poilievre promised to have a “common sense” immigration policy built around the number of vacancies in the private sector, the number of charities that can sponsor refugees, and family reunification. He also said he would be open to limiting the number of international students entering Canada based on “the availability of spaces at universities and homes for those students.”
He went further in December 2023 by saying it was “very simple math” that increasing the number of newcomers without ensuring adequate housing would drive up housing prices. By August 2024, Poilievre was calling for Canada to have smaller immigration-driven population growth, saying it was negatively impacting housing, health care, and employment.
In Quebec, in January Premier François Legault said the province was nearing its “breaking point” due to an influx of asylum-seekers. In a letter to Prime Minister Justin Trudeau, he asked Trudeau to tighten policies around granting visas and to grant Quebec full powers over immigration. Trudeau rejected Legault’s request in March.
While immigration may have once been a controversial issue usually avoided by politicians in Canada, polling indicate that the views of these lawmakers are increasingly in line with those of the majority of Canadians. A December 2023 Nanos poll indicated that 61 percent of Canadians wanted the country to accept fewer immigrants, compared to 53 percent who said so in September 2023 and 34 percent who said so in March 2023. Only 5 percent of respondents in the December poll said they wanted Canada to accept more immigrants, compared to 17 percent in 2020.
Quebec Premier Francois Legault at a news conference in Montreal on Aug. 20, 2024. The Canadian Press/Ryan Remiorz
In January 2024, Housing Minister Sean Fraser and Immigration Minister Miller released a joint statement saying Ottawa was working to stabilize the number of people entering Canada as housing pressures mount. That same month, Miller announced a two-year intake cap on the number of international student permit applications, bringing the number down from the approximately 560,000 student visas issued in 2023 to roughly 360,000 approved study permits for 2024.
The cost-of-living requirement for international students also doubled beginning Jan. 1, 2024, rising from $10,000 to $20,635, to better reflect the “accurate cost of living in Canada,” Miller said in December 2023.
Recently, in September, Ottawa announced it would further limit the number of international students entering Canada in 2025 by reducing the target number of new study permits issued, from 485,000 to 437,000.
In June, IRCC said it would be implementing new regulations to address “unethical behaviour” by universities and colleges that it said was abusing Canada’s foreign student program. In February, Miller had accused some colleges of suspicious practices in accepting large numbers of foreign students, including a portion who promptly claimed refugee protection in Canada.
In March, Ottawa announced a plan to reduce the number of temporary residents from 6.5 percent of Canada’s population to 5 percent over the next three years. “Temporary residents” include international students (42 percent) and temporary workers under the Temporary Foreign Workers Program (9 percent) and those under the International Mobility Program (44 percent).
Miller said in early October that Canada had become “addicted to temporary workers“ and that businesses have ”leveraged that opportunity” and should bear some responsibility. This followed Trudeau’s comment in August that “it’s not fair to Canadians struggling to find a good job, and it’s not fair to those temporary foreign workers, some of whom are being mistreated and exploited.”
Then on Oct. 24, the federal government announced the reduction in the number of permanent residents to be admitted into Canada over the next three years. Ottawa said the resulting 0.2 percent population decrease in both 2025 and 2026 is expected to reduce the housing supply gap by around 670,000 units by the end of 2027.
At the press conference, the prime minister said that while Canadians are “justifiably proud” of their immigration system, the federal government has a responsibility to ensure “that pride, that faith in immigration, is not undermined.”
“We are acting today because in the tumultuous times, as we emerged from the pandemic, between addressing labour needs and maintaining population growth, we didn’t get the balance quite right,” he said.
