Canada already on track for much lower foreign-worker intake — projected arrivals fall ~165,000 short of 2025 target
New projections show Canada is likely to admit far fewer foreign workers in 2025 than the target set in the Immigration Levels Plan — a shortfall that already mirrors the government’s lower targets for 2026. Based on arrivals between January and August 2025 and seasonal patterns from 2024, analysts estimate total foreign-worker admissions this year will reach roughly 202,923 — about 164,827 fewer than the 2025 target of 367,750.
The gap is driven mainly by a steep decline in International Mobility Program (IMP) arrivals, reflecting federal policy changes over 2024–2025 that tightened access to study-to-work pathways, spouse work permits and low-barrier mobility streams.
Key figures at a glance
- Projected total foreign workers in 2025 (TFWP + IMP): 202,923
- 2025 target (as published): 367,750
- Projected shortfall vs. 2025 target: −164,827
- Projected shortfall vs. 2026 target (230,000): −27,077
Breakdown by program (projected 2025 totals):
- Temporary Foreign Worker Program (TFWP): 59,679 (vs target 82,000)
- International Mobility Program (IMP): 143,244 (vs target 285,750)
Observed January–August 2025 arrivals (actual):
- TFWP: 43,315
- IMP: 111,200
- Total (Jan–Aug): 154,515
How the projection was made
Analysts adjusted 2025 January–August arrivals for seasonal patterns using the 2024 distribution of arrivals. In 2024, January–August accounted for roughly 72.6% of annual TFWP admissions and 77.6% of IMP admissions. Applying those ratios to the 2025 Jan–Aug totals yields the annualized projections used above.
What policies caused the decline?
A series of federal policy changes introduced across 2024 and 2025 aimed at reducing temporary resident numbers — especially international students and lower-paid temporary workers — have substantially reduced new work permit issuances. Major measures include:
- Moratoriums on low-wage LMIAs in regions with high unemployment.
- Higher wage thresholds for the TFWP high-wage stream.
- Narrowing Post-Graduation Work Permit (PGWP) eligibility (field-of-study limits and language requirements).
- Restrictions on spousal open work permits for many students and workers.
- Stricter guidance for intra-company transfers and other IMP streams.
- Introduction of multi-year targets and tighter enforcement measures.
Collectively, these steps were intended to ease pressure on housing and services and to lower overall temporary resident shares of the population.
Early economic and housing effects
Economists and housing analysts have already detected measurable consequences. A recent TD analysis — cited by several policy observers — estimates that slower temporary resident inflows have reduced the projected increase in purpose-built rental prices between 2025 and 2027 from 5.5% to 3.5% under unchanged interest-rate and supply assumptions. In other words, curtailed temporary arrivals likely subtracted nearly two percentage points from expected rent growth.
On the labour-market side, models suggest lower labour-force inflows helped prevent a sharper rise in unemployment; without the reduction in temporary residents, unemployment could have risen further. That said, many sectors facing chronic labour shortages — health care, agriculture, long-term care, and some trades — report hiring stress and unfilled positions, illustrating a tradeoff between short-term housing relief and persistent staffing gaps.
What this means for 2026 policy
The current pace of arrivals aligns more closely with the federal government’s newly set 2026 target of 230,000 foreign workers. If policy and enforcement remain at present levels, 2026 admissions may not need additional cuts to meet government goals — but provinces and employers will continue to press for targeted exemptions and employer-led channels to fill critical vacancies.
Federal officials have signalled continued emphasis on transitioning temporary residents already in Canada to permanent residence rather than increasing new temporary inflows. As a result, expect future measures to prioritize in-Canada transitions (PNPs, Express Entry allocations and targeted PR pathways) while limiting new temporary permits in lower-priority streams.
Implications and next steps for stakeholders
- Employers: Revisit workforce plans, accelerate domestic recruitment and retention, and engage with provincial nominee streams and targeted federal initiatives to secure talent.
- Jobseekers / temporary residents: Explore provincial nomination routes and in-Canada PR pathways that increasingly favour those with local ties.
- Policy makers: Balance housing and service relief with targeted labour-market exceptions to avoid critical shortages in essential sectors.
- Housing analysts: Monitor rent and vacancy trends closely — effects are already visible in several metropolitan areas.
Bottom line
Canada’s temporary-resident landscape is shifting fast. Policy choices made to ease housing pressure have already cut temporary worker admissions substantially; the effects are visible in slower rent growth and a smaller labour-force influx — but they also raise concerns about staffing shortages in key sectors. As the country transitions from volume-based admissions to more targeted selection, employers, provinces and applicants will need to adapt quickly.
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