The number of temporary residents in Canada has declined for the first time in three years, after a series of policy changes introduced by Ottawa last year to reduce immigration levels.
New data from Statistics Canada published Wednesday show that there were roughly 30,000 fewer temporary residents in the country as of Jan. 1, compared with Oct. 1, 2024. The total stood at just over three million people, or 7.3 per cent of the population, down from 7.4 per cent the previous quarter.
The decrease in the number of temporary residents is causing overall population growth to slow. In the fourth quarter of 2024, the population grew by 0.2 per cent to roughly 41.5 million people, the slowest rate of growth since late 2020, when many border restrictions were in place because of the pandemic.
The country is in the early stages of a demographic slowdown. After years of soaring growth, which stoked concerns that Canada was growing too quickly to absorb newcomers, the federal government is trying to freeze the population over the next two years by drastically reducing the number of visas issued to temporary residents, such as international students, and cutting the permanent resident intake.
Ottawa’s goal is to lower the share of temporary residents in the country to 5 per cent of the total population by the end of 2026. The target was first announced in March, 2024.
Still, many economists and demographers think the federal government will struggle to hit the mark.
“There’s very good reason to be skeptical that this 5-per-cent target will be met by Jan. 1, 2027,” said Mikal Skuterud, an economist at the University of Waterloo. “There was a political incentive to announce such a target at the time but meeting it will be very difficult, even with the reforms that were announced last year.”
Over all, the Canadian population rose by around 744,000 people in 2024. At 1.8 per cent, the growth rate was higher than in any year between 1972 and 2021. Still, that marked a deceleration from the rapid growth of 2.5 per cent and 3.1 per cent in 2022 and 2023, respectively, largely because of a massive increase in the number of temporary residents.
The latest Statistics Canada data show that while the number of people holding student permits declined by approximately 33,000 in the fourth quarter, that reduction was softened by the rise in the number of refugee claimants (25,774). This is the 12th consecutive quarter that asylum claims have increased, bringing the total number of claimants in Canada to 457,285 people, a record high.
Achieving the 5-per-cent target is less realistic now than a year ago, according to Prof. Skuterud. He estimates that, in order to meet the target, the number of temporary residents will have to decline by almost 32 per cent over two years, or a decrease of roughly one million.
Further, Prof. Skuterud’s calculations show that the total Canadian population will have to decline by 0.4 per cent over the next two years for the temporary-resident goal to be met.
While Ottawa has tried to cap new foreign entries, it is also banking on existing temporary residents leaving voluntarily after their work or study permits expire. For example, more than 200,000 postgraduate work-permit holders could see their visas expire by the end of 2025. “I’m not sure how many will actually leave, so you could have a slow increase in the undocumented population,” Prof. Skuterud added.
The Statscan data also showed that Ottawa granted permanent resident status to around 484,000 immigrants in 2024, the highest number in any year since 1972. The government has reduced its permanent-resident intake targets for the next three years by 20 per cent.
Statscan noted that population growth was strongest in Alberta, while both Ontario and B.C. – provinces with a larger share of international students – saw a slowing in population growth last quarter.
The impact of a population growth slowdown is being felt on the ground in weaker consumer spending and loosening rental markets, Robert Kavcic, senior economist at Bank of Montreal, wrote in a Wednesday note. “It’s also early days on this trend with further normalization ahead,” he added.