Canada Sees First Year-Over-Year Decline in Foreign Worker and Student Numbers Amidst Tightened Immigration Policies

Significant Drop in Temporary Residents

Canada has experienced its first year-over-year decline in the total number of foreign workers and international students in recent years, a shift attributed to the federal government's tightening immigration regulations. Between 2024 and 2025, the country registered a net decrease of 14,954 temporary residents (TRs). This marks a significant reversal from the period between 2023 and 2024, when Canada gained 781,075 non-permanent residents before the bulk of new restrictions were enacted.

The reduction in temporary residents contributed to Canada's largest population drop on record in the third quarter of 2025, with the national population falling by 76,068 people, or 0.2 percent. Population growth also slowed across all census metropolitan areas between July 2024 and July 2025.

International Student Numbers Plummet

The international student population has been particularly affected by the new policies. New study permits issued in 2024 totaled 267,890, representing a 48 percent decrease from 2023 levels and falling nearly 100,000 short of the federal target of 360,000. By the end of 2024, Canada hosted approximately 997,820 international students, a 4 percent decline from the previous year's record of 1.04 million.

Further declines were observed in 2025, with new international student arrivals dropping by 60 percent between January and September compared to the same period in 2024, equating to 150,220 fewer students. The overall international student population fell by 26 percent from August 2024 to August 2025.

Tightening Regulations for Foreign Workers

Temporary foreign worker arrivals have also seen a marked reduction. Between January and September 2025, Canada welcomed 48 percent fewer new temporary workers than in the corresponding period of the previous year, a decrease of 158,660. Current foreign worker admissions in 2025 are more than 100,000 below projections, indicating that the country is on track to meet its 2026 reduction goals ahead of schedule.

Key policy changes impacting foreign workers include:

• A moratorium on low-wage Labour Market Impact Assessments (LMIAs) in regions with an unemployment rate of 6 percent or higher, effective September 26, 2024.
• A reduction in the maximum employment duration for low-wage Temporary Foreign Worker Program (TFWP) permits to one year from two, implemented in September 2024.
• A 10 percent cap on low-wage hires by employers, with certain industry exemptions.

Comprehensive Policy Overhaul

The Canadian government's strategy to reduce temporary resident numbers is multifaceted, targeting both international students and foreign workers. Immigration Minister Marc Miller stated that the purpose of the international student program is primarily 'to study and not to work.'

Significant policy adjustments include:

• Study Permit Caps: A two-year cap on new study permits was introduced in January 2024, aiming for a 35 percent reduction from 2023 levels. The 2025 cap is set at 437,000 permits, representing a 10 percent reduction from 2024.
• Increased Financial Requirements: As of January 1, 2024, study permit applicants must demonstrate access to CA$20,635, double the previous requirement of CA$10,000.
• Post-Graduation Work Permit (PGWP) Reforms: Effective November 1, 2024, new language proficiency requirements (CLB 7 for university graduates, CLB 5 for college graduates) and field-of-study restrictions apply. International graduates of college programs delivered through public-private partnerships are no longer eligible for PGWPs as of May 15, 2024.
• Spousal Open Work Permit (OWP) Restrictions: Stricter rules came into effect on January 21, 2025, limiting OWPs to spouses of international students in master's (16 months or longer) or doctoral programs, or select professional programs. For foreign workers, OWPs are now restricted to spouses of those in TEER 0 or 1 occupations, or specific TEER 2 or 3 occupations in shortage sectors. Dependent children of foreign workers are no longer eligible.

These measures are part of a broader government objective to reduce the temporary resident population to 5 percent of Canada's total population by 2027, addressing concerns about housing shortages, pressure on social services, and aligning immigration with labor market needs.