Canada has recorded its most significant population contraction in over half a century, a stark reversal for a nation that has long relied on robust immigration for economic growth. New data reveals the tangible impact of a major policy pivot by the federal government in Ottawa, which has moved aggressively to reduce the influx of non-permanent residents after public sentiment soured.
A Dramatic Policy Reversal
Just a year ago, former Prime Minister Justin Trudeau stood in the House of Commons championing immigration as a cornerstone of Canada's economic success. His successor, Prime Minister Mark Carney, now leads a government that has spent much of this year dismantling key parts of that very system. In November, Carney told students his administration was focused on "getting immigration under control."
The shift followed a period of explosive growth. Two years ago, grappling with severe post-pandemic labour shortages, Canada approved a surge of non-permanent residents, boosting the population by 1.3 million. The government later concluded this rapid expansion strained housing and infrastructure. Immigration Minister Marc Miller described the situation as "overheated" and vowed to instil discipline in the system.
The Numbers Behind the Decline
Statistics Canada's latest estimates show the population fell by 0.2% in the third quarter of this year, dropping to 41.6 million from 41.65 million on 1 July. This marks only the second quarterly decline on record; the first was during the 2020 Covid-19 border restrictions.
The recent drop is largely attributed to a sharp decrease in the number of international students. The federal government has halved the number of study permits issued and cut work permits for migrant labourers, while increasing deportations. These measures are a direct response to what officials deemed an unsustainable pace of growth.
Keith Neuman of the Environics Institute suggests the latest figures represent a necessary correction. "The impact of the policy takes time to come into effect and make a difference. These latest figures confirm what should have been expected," he said.
Immigration Becomes a Partisan Wedge Issue
The policy changes coincide with a profound shift in Canadian public opinion. Polling from the Angus Reid Institute indicates concern over immigration has quadrupled in the last two years. Government polling itself found support for current immigration levels at a 30-year low.
This skepticism has become intensely partisan. Environics reports that federal Conservative party supporters are now the most critical group on immigration, with their views hardening significantly. Neuman notes that while skepticism exists across party lines, "the split between parties has been gradually building... over the last two years, maybe that gap has really widened."
The nature of public concern has also evolved. For decades, debates centred on cultural assimilation. Now, the collision of high immigration volumes with a severe cost-of-living crisis has redirected focus to volume and economic pressure. "Housing was less affordable. Infrastructure was stretched," Neuman explained, highlighting how economic precarity altered the national conversation.
Economic and Social Repercussions
The population decrease presents a mixed economic picture. Economist LJ Valencia of Desjardins Group notes that reducing non-permanent residents could boost real GDP per capita. However, he warns that weaker population growth will also act as a drag on the broader economy, compounding existing challenges like trade uncertainty and high mortgage renewals.
The strain on systems is evident elsewhere. Federal data shows a spike in resettled refugees using homeless shelters in 2023. Processing backlogs are severe, with some immigration wait times estimated at up to a decade—a situation Neuman says clearly indicates a system not "under control."
As Prime Minister Carney prepares a new immigration plan promised in the next budget, aimed at matching intake with capacity, the nation grapples with the consequences of its dramatic boom and pivot. The record population drop is more than a statistic; it is a direct reflection of a profound and contentious recalibration of a fundamental Canadian policy.
