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| Colin R. Singer |
The plan holds permanent resident admissions steady at 380,000 per year for three years but introduces a continued, drastic reduction in temporary resident entries — a change that will reshape how people come to live, work and study in Canada.
Under the plan, temporary admissions will fall from 673,650 in 2025 to 385,000 in 2026, then to 370,000 in both 2027 and 2028. That’s a reduction of almost 45 per cent in one year and a return to pre-pandemic levels of intake. This reduction is a direct response to the shift in public opinion, that immigration levels are too high.
While the government argues this move will restore balance and sustainability, it could also limit short-term labour supply in key industries that rely heavily on foreign workers and students.
Sharp decline in temporary resident admissions
The drop in temporary residents is the headline shift of the new plan. After several years of rapid increases driven by international students and temporary foreign workers, the government has set new caps aimed at reducing pressure on housing, health care and infrastructure. In January 2025, there were just over three million temporary residents in Canada, representing 7.3 per cent of Canada’s total population.
The Government of Canada has set a target to reduce the proportion of temporary residents to five per cent of the total Canadian population by the end of 2026. This is a reduction from the unprecedented growth seen in recent years, where the temporary resident share of the population more than doubled from 3.3 per cent in 2018 to about 7.5 per cent in 2024. The planned levels for the next three years reflect this policy shift.
Projected temporary resident admissions (2026-2028)
The largest reduction will fall on international students, whose new study permit approvals will be halved by 2026. This is by far Canada’s biggest failure in managing its temporary residence programs.
Work permit issuance will also be curtailed through both the Temporary Foreign Worker Program (TFWP) and the International Mobility Program (IMP).
According to Budget 2025, these measures will cost $168.2 million over four years due to lower fee revenues, but Ottawa says they will help “restore control, clarity and consistency” to the system.
Critics, however, warn that sectors such as food production, construction and health care could face intensified labour shortages if caps are not adjusted regionally.
Permanent resident admissions: Stability amid contraction
While temporary migration will shrink, permanent immigration will remain steady at 380,000 admissions annually between 2026 and 2028. This continuity suggests the government aims to focus on integration rather than expansion.
Planned permanent resident admissions (2026-2028) economic share to rise, but total volume unchanged
The economic class share of total immigration will increase from 59 per cent in 2025 to 64 per cent by 2028. Ottawa says this adjustment better aligns with Canada’s workforce priorities and addresses gaps in health care, trades and technology.
At the same time, maintaining stable permanent numbers may reflect concern about absorption capacity — particularly in housing, health care and education systems already under strain.
It is particularly noteworthy that within the economic class, the official 2025 planned forecasted levels do not specify a distinct projected number of individuals for the Canada Start-Up Visa (SUV) program. However, it reports 7,635 admissions through the broader Federal Business Class (which includes the Start-Up Visa and Self-Employed Persons programs) in 2024.
The overall economic class, which includes the Start-Up Visa program along with other economic streams such as Federal Skilled Workers and Provincial Nominee Programs, is projected at approximately 239,800 admissions in 2026, rising slightly to 244,700 in 2027 and 2028.
The Start-Up Visa program admissions are wrapped into this total, but no separate target or projection specifically for the Start-Up Visa has been published in the 2025 report for the 2026-2028 Levels Plan.
They remain included within the overall Federal Business Class and Economic category admissions totals. This signals that similar numbers could be forecasted in 2026-2028, as were admitted in 2024, once the current inventory of approximately 42,900 is reduced, through new planned legislation under Bill C-12.
Regularization and integration measures
To mitigate the effects of tighter entry rules, the government will introduce two new regularization measures:
1. Recognizing protected persons as permanent residents
Over the next two years, Canada will grant permanent residence to eligible protected persons who cannot return to their home countries.
- Fiscal cost: $120.4 million over four years (starting 2026-27)
- Objective: Accelerate integration and reduce backlogs
2. Transitioning work permit holders to permanent status
Up to 33,000 work permit holders with strong ties to Canada will gain permanent residence between 2026 and 2027.
- Fiscal cost: $19.4 million over four years (starting 2026-27)
- Aim: Reward economic contribution and community connection
While these initiatives demonstrate compassion and fairness, they are small in scale relative to the significant reduction in new entrants.
Regional and sectoral implications
The plan recognizes that some parts of Canada — particularly rural and remote communities — depend heavily on temporary foreign workers. To avoid economic disruption, IRCC says it will consider regional and sectoral factors, including:
- Industries affected by tariffs and supply chain pressures
- Agricultural and food-processing sectors dependent on seasonal labour
- Health care and elder care roles facing ongoing shortages
However, the details of how these regional adjustments will be implemented are still to be announced.
Fiscal and population impact
The fiscal impact of the plan is twofold: lower fee revenues from reduced temporary intake and increased administrative costs for regularization measures.
- Net fiscal cost: $168.2 million over four years (starting 2026-27)
- Permanent share of population: Under one per cent per year
- Temporary residents: To fall below five per cent of total population by 2027
These adjustments are designed to slow population growth after Canada’s record surge of 2023-2025, when temporary residents accounted for nearly 7.5 per cent of the population. Supporters argue the reduction is overdue; critics worry it risks cooling economic momentum and worsening labour gaps.
Balancing control and compassion
The 2026-2028 Immigration Levels Plan marks one of the most significant U-turn recalibrations of Canada’s immigration system. It aims to balance economic needs with public capacity and restore predictability after a period of post-pandemic, exceptional growth. The tone is one of restraint rather than expansion — an attempt to consolidate rather than accelerate.
While permanent immigration remains robust and economic pathways are being prioritized, the deep cut in temporary admissions will be felt across universities, agriculture, hospitality and small businesses that have come to rely on foreign talent.
Comparison: 2025 to 2026 permanent and temporary resident targets
Frequently asked questions
1. How many immigrants will Canada accept from 2026 to 2028?
Canada will admit 380,000 permanent residents each year while sharply reducing temporary resident admissions from 673,650 in 2025 to 370,000 by 2027.
2. Why is the government cutting temporary resident numbers so drastically?
Ottawa says the goal is to relieve housing and infrastructure pressure and cater to a growing shift in public sentiment that immigration levels are too high. Critics warn it could worsen labour shortages in sectors reliant on foreign workers.
3. What happens to international students under this plan?
New study permits will fall by nearly half, from over 300,000 in 2025 to 155,000 in 2026. Current students already in Canada are not affected by the cap.
4. Will fewer temporary workers mean fewer paths to permanent residency?
Not necessarily. While new work permits will decline, up to 33,000 existing workers will transition to permanent residence in 2026-2027.
5. How will this plan affect population growth?
The plan is expected to slow population growth to below one per cent annually from permanent immigration and cut the temporary population share to under five per cent by 2027.
Colin R. Singer is immigration counsel and founder of www.immigration.ca. He can be reached at colin@immigration.ca.
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