Canada to Set Temporary Resident Targets, Starting Fall 2024; aka a Big Mistake

Canada is set to adjust its approach to managing the temporary resident population, initiating a strategic reduction to align the temporary resident count with broader national interests.

Canada is set to adjust its approach to managing the temporary resident population, initiating a strategic reduction to align the temporary resident count with broader national interests. Starting in fall 2024, the country will see a calibrated decrease in the number of temporary resident status documents issued, aiming to lower the ratio of temporary residents from the current 6.2% to 5% of the total population. This adjustment, planned in close collaboration with provincial and territorial stakeholders, is anticipated to result in a significant reduction of around 456,000 to 475,000 temporary resident permits, a roughly 19% cut from current figures.

Temporary residents are foreign nationals who are in Canada on a valid status. Holders of work permits, study permits, and visitor records, as well as those who were allowed short-term entry on a stamp or without, but through the border inspection, are all temporary residents.

This recalibration particularly affects the issuance of study permits, with international students currently constituting 42% of Canada’s temporary resident population. The cap on international students is expected to form a substantial portion of the overall reduction. Although further adjustments to the international student cap are under consideration, decisions will hinge on provincial feedback, leaving these figures subject to future clarification.

Essential Insights on Canada’s Temporary Resident Policy Adjustments

  • The expansion of Canada’s Immigration Levels Plan now encompasses temporary resident targets, responding to shifts in the labor market and the balance between labor availability and demand
  • Temporary foreign workers will be capped at 20% of the workforce across most Canadian sectors, with a new mandate for employers to prioritize hiring from within Canada, including asylum seekers and other underrepresented groups, before seeking an LMIA
  • Annual wage reviews for temporary foreign workers will ensure competitive compensation

Immigration Minister Marc Miller emphasized the need for a balanced approach to managing temporary resident volumes, which have surged to 2.5 million, prompting the upcoming policy adjustments.

Impact on Employers and Workers

The forthcoming policy shift signals a more restrictive framework for employing temporary foreign workers, with most sectors seeing a decrease in allowable percentages. Key sectors like healthcare and construction may retain higher limits temporarily, reflecting a nuanced approach to labor needs across industries. Additionally, employers are encouraged to recruit from a domestic pool of candidates, including those with temporary status in Canada, before resorting to foreign hires.

Broader Implications

The adjustments aim to tackle inefficiencies and sustainability issues within Canada’s immigration system, balancing the need for temporary residents against national housing and cost of living challenges. While the impact on specific programs remains to be detailed, the overarching goal is to streamline the temporary resident intake in alignment with economic and social priorities.

For applicants outside Canada, the changes underscore a more selective approach to temporary residency, with specific programs and sectors likely to experience tighter controls.

Affected Programs

A significant portion of the temporary resident population includes international students, temporary foreign workers, asylum seekers, and various categories under the International Mobility Program. The precise distribution of reductions across these groups is pending, with further government discussions expected to outline the specifics.

For those navigating the shifting landscape of Canadian immigration, staying informed and adaptable will be crucial. As the government fine-tunes its policies, prospective temporary residents and employers alike must prepare for a new era of immigration management that balances individual aspirations with national interests.

All Points’ editorial

Canada’s decision to scale back the number of temporary foreign workers by approximately 19% is a knee-jerk reaction to the housing supply crisis, yet it overlooks a critical aspect of the Canadian economy’s backbone: its reliance on these very workers to fill crucial skill gaps. With an ageing population, Canada’s economy is at a juncture where the need for a robust workforce is more pressing than ever. Instead of curtailing the influx of talent that has historically fueled the country’s growth, the government’s strategy should pivot towards a more sustainable solution: partnering with corporations to address the housing shortfall while continuing to welcome the temporary foreign workers who are indispensable to our economic fabric.

Bloomberg News underscores the potential repercussions of this policy shift, suggesting Canada’s economy could contract as a direct consequence. The question then arises: How will this 19% reduction be enforced? What is nefarious about the announcement? They didn’t say how they were going to reduce it by 19%. So, here is the way an open and transparent reduction of temporary foreign workers should go: “We are going to change this X barrier to entry to 1.5 X Barrier to entry”. That way corporations can plan. They can react accordingly. But we get no such signal. The approach, it seems, won’t involve overt policy changes but rather a tightening of the approval process for standard Intra Company Transfers – a move that’s not just counterproductive but also opaque. Such lack of transparency does a disservice to corporations, which depend on clarity and predictability to strategize and thrive. All Points has already started to see questionable rulings by IRCC. We recently saw someone who is clearly a specialist in his field, was uled not to be a specialist. There was no justification for that ruling. That company went through all kinds of effort and planning, just to find out that their person who would have successfully got in 5 months ago, can no longer get in. Hey Ottawa – companies just can’t run like that, and they make take their talent elsewhere if you do not come up with the new definable goal posts.

If the government is just tightening screws, as suggested above, All Points contends that while the Immigration, Refugees and Citizenship Canada (IRCC) may align its application assessments with the government’s directive, it faces a significant hurdle in exerting the same level of control at Ports of Entry, where the Canada Border Services Agency (CBSA) holds sway. This discrepancy further complicates the landscape for companies relying on international talent to meet their operational needs.

This strategy is more than just an administrative headache; it’s a misstep that could hamper Canada’s economic momentum, starving sectors of the essential skills they need to compete on a global stage. “This policy would have a material impact on the economy moving forward,” Royce Mendes, head of macro strategy at Desjardins, said in a report to investors. “The combination of a highly interest-rate sensitive economy and the likelihood of slower population growth are the main reasons we have been more bearish on the medium-term outlook for the Canadian economy.” So that is the best our brain trust has – hurt our economy rather than build homes faster?

Ottawa, step up (it should have stepped up ages ago, but we will take now) and come up with a plan with the provinces and builders to build the called for 5.8 million homes, when you are on target for 3.5 million less than that. We have had politicians hand wringing since early 2023 about the housing crisis. Ottawa did give a GST rebate on home construction, but not all provinces joined in the program from the Provincial Sales tax portion of the tax. To address other housing pressures, the federal government rolled out the Housing Accelerator Fund and allocated $4 billion to it to encourage more home building in cities. But… the Housing Accelerator Fund, which is to incentivize cities to build 100,000 homes, may sound like a lot, but it is not. It actually represents 2.9% of the additional homes required, according to the Canada’s Housing Supply Shortages report. A HUMAN RIGHTS-BASED CALCULATION OF CANADA’S HOUSING SUPPLY SHORTAGES (PDF)

This isn’t playtime. That figure needs to be much higher, which means that Ottawa and the provinces and the cities need to work together far more than they are. Choking the economy is the easy way out. As it is, the Canadian economy is growing at an anemic rate of 0.8%, By contrast the United States is growing at 3.3%. And we are about to reduce one of the winds in our sails – temporary foreign workers. 0.8% is mighty close to contraction. A self-inflicted contraction will hurt Canadians. So, we have two important things to do: a) build houses; b) get more workers to drive our economy. My kids learned to walk and chew gum at the same time quite early in life; I expect the same of my government.

It’s time for a recalibration of priorities, where innovative housing solutions and the continued influx of foreign talent aren’t mutually exclusive but part of a cohesive strategy to bolster the Canadian economy. The message to the government should be unequivocal: Build the necessary infrastructure and maintain the flow of workers who enrich our economy. Anything less is a disservice to the country’s future.

For detailed information and updates, visit the official government website:

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