Canada is set to make significant changes to its immigration and temporary residency programs, particularly focusing on international students, in response to the challenges of rapid population growth, labor market needs, and public pressure over the country’s strained resources. Among the key changes, the government will reduce the annual cap on study permits by another 10% in 2025 and place new restrictions on work permits for international graduates. These measures are intended to ensure that Canada’s immigration system remains sustainable and continues to meet the demands of the evolving labor market while also addressing housing and public service challenges.
The announcement follows a by-election loss for the Liberal government in Quebec, which put further pressure on the party to respond to public concerns around immigration and its impact on Canada’s resources. The federal government revealed plans to lower the intake of study permit applications from 485,000 in 2024 to 437,000 in 2025. The cap will remain at this level for 2026 as well, providing a clear indication that the current government is committed to controlling the influx of international students in an effort to manage the population growth more effectively.
Additionally, changes will be introduced to the Post-Graduation Work Permit (PGWP) program, a pathway that allows international students to gain Canadian work experience after completing their studies. This program will be aligned more closely with labor market needs, targeting specific sectors that require skilled workers and cutting back on areas that are oversaturated or less in demand.
Managing Population Growth and Economic Needs
The changes to the study permit system come at a time when Canada’s population has surged past 41 million. Much of this growth has been attributed to immigration, particularly from temporary residents, including international students. While international students bring economic benefits and cultural diversity, their growing numbers have led to increased pressure on the country’s housing market and public resources such as healthcare. Critics have pointed out that the government was too slow to adjust immigration levels in line with these pressures, exacerbating the affordable housing crisis and the strain on public services.
The Liberal government has faced growing calls to address these issues, which have become a major topic of public debate. Prime Minister Justin Trudeau’s approval rating has been affected by this discourse, with concerns that the influx of international students and temporary workers has contributed to higher housing costs and greater competition for resources. As a result, the government has been forced to rethink its immigration policies to balance the benefits of welcoming newcomers with the need to preserve the quality of life for Canadian citizens.
To this end, Immigration Minister Marc Miller emphasized the importance of maintaining the integrity and sustainability of the immigration system. He stated that while Canada remains open to immigrants, it is necessary to ensure that those coming to the country are set up for success. This means adjusting the temporary residence programs, including study permits and work permits, to better align with Canada’s economic needs and the capacity of its public services.
The government’s new policy targets reducing the proportion of temporary residents in Canada’s total population. Currently, temporary residents, including international students and foreign workers, make up 6.1% of the population. The goal is to reduce this to 5% over the next three years, which will involve scaling back the number of new permits issued and tightening eligibility requirements for certain programs.
Reductions in Study Permits
A key part of the government’s strategy is the reduction of study permits. In 2024, the government had already imposed a cap on new study permits, aiming for a 35% decrease in new permits compared to the previous year. This was part of an effort to slow the influx of international students, which had been increasing at a rapid pace over the past several years. However, data from the first half of 2024 suggests that the decrease in study permits could be even more significant, with projections indicating a 50% reduction for capped post-secondary programs and a 24% reduction for graduate-level programs.
Building on these earlier measures, the government announced that the cap on study permits will remain in place for the next two years, with an additional 10% reduction planned for 2025. This will bring the total number of study permits issued down to 437,000 in 2025 and 2026, compared to the 485,000 projected for 2024. The intention is to create a more controlled and sustainable system that prioritizes the needs of the Canadian labor market while managing the growth of temporary residents.
Changes to Work Permits for Graduates and Their Spouses
Another major component of the government’s plan is the reform of the Post-Graduation Work Permit (PGWP) program. This program has been a critical pathway for international students to gain work experience in Canada after completing their studies, and many use it as a stepping stone toward permanent residency. However, the government has decided to limit eligibility for the PGWP, particularly for graduates of certain programs.
Starting in October 2024, international students graduating from college certificate or diploma programs will no longer automatically qualify for the PGWP. Instead, their eligibility will be tied to the specific labor market needs of the province or territory in which they are studying. In other words, only graduates whose work aligns with areas of high labor market demand will be eligible for the PGWP. This change reflects the government’s focus on ensuring that the immigration system is directly serving the country’s economic needs by prioritizing sectors where there are labor shortages.
The eligibility for work permits will also be restricted for the spouses of international students and foreign workers. Currently, spouses of international students at the graduate level have the right to obtain an open work permit, which allows them to work in any field while their partner is studying. However, under the new rules, only spouses of students enrolled in graduate programs that are at least 16 months long will be eligible for this permit. Additionally, the government will restrict work permits for the spouses of foreign workers to those who are employed in management or professional occupations, or in sectors experiencing labor shortages.
These changes are intended to reduce the number of temporary residents in Canada while still allowing the immigration system to respond to genuine labor market needs. The government believes that by focusing on specific sectors and professions, it can strike a balance between welcoming newcomers and ensuring that Canadian workers have access to job opportunities.
Language Proficiency Requirements for PGWP
In addition to these restrictions, the government is introducing a new language proficiency requirement for the PGWP program. Beginning November 1, 2024, all applicants for the PGWP will need to demonstrate a minimum level of proficiency in either English or French. For university graduates, the required proficiency level will be Canadian Language Benchmark (CLB) 7, while for college graduates, it will be CLB 5.
This requirement is designed to help international graduates transition more smoothly into the Canadian labor market and increase their chances of permanent residency. The government believes that language skills are critical for success in the workforce, and by requiring PGWP applicants to meet minimum proficiency levels, it hopes to improve their ability to integrate into Canadian society and contribute to the economy. Moreover, this measure will ensure that international graduates are better prepared to adapt to changing economic conditions, particularly in sectors where language proficiency is essential.
The Canadian government is also introducing new language proficiency requirements as part of the changes to the Post-Graduation Work Permit (PGWP) program. Starting November 1, 2024, all applicants will need to demonstrate a minimum level of language proficiency in either French or English to qualify for the PGWP. This measure aims to improve the ability of international graduates to transition to permanent residency and better adapt to the evolving economic conditions in Canada.
For university graduates, the required language level will be Canadian Language Benchmark (CLB) 7, while for college graduates, the minimum will be CLB 5. This shift reflects the government’s goal of ensuring that those entering the Canadian workforce through the PGWP program possess adequate language skills to meet labor market demands and integrate more effectively into Canadian society.
The introduction of this requirement is part of a broader strategy to align immigration policies with the country’s labor needs, ensuring that international students who remain in Canada post-graduation have the language proficiency necessary to succeed in the job market and contribute to the economy.
Canada’s new measures on immigration, particularly the cap on study permits and changes to the PGWP program, reflect the government’s efforts to manage the country’s growing population while addressing the needs of the labor market. The introduction of language proficiency requirements and restrictions on work permits for international graduates and their spouses are part of a broader strategy to align immigration policies with economic priorities. By reducing the number of temporary residents and focusing on areas of labor market demand, the government aims to create a more sustainable and well-managed immigration system that supports both newcomers and Canadian workers.
