Ottawa needs to “stem the tide” of new arrivals and ensure more non-permanent residents depart Canada to meet its population goals, a new study suggests.
Although the arrival of new non-permanent residents (NPRs) has dipped, the existing influx of NPRs into the country will prevent Ottawa from achieving its objective of lowering temporary resident numbers to less than 5 percent of the Canadian population, a new report from financial services firm Desjardins found.
The federal government announced plans last March to reduce the share of non-permanent residents to 5 percent of the population over three years as Canada grapples with a housing shortage. The new targets established for temporary residents were 445,901 for 2025 and 445,662 for 2026.
The changes, Ottawa said, would result in a marginal population decline of 0.2 percent in both 2025 and 2026.
While report authors and Desjardins economic analyst LJ Valencia and deputy chief economist Randall Bartlett said Canada has made progress in slowing population growth, the number of non-permanent residents continues to pose a challenge in meeting the overall targets.
Canada’s revised targets have slowed the influx of non-permanent residents, but they are not stringent enough to meet the 5 percent reduction goal, the report said. Instead, NPRs made up approximately 7.5 percent of the population by the end of 2024.
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Desjardins estimated the number of new temporary resident permit holders decreased by 25 percent compared to the previous year in the last quarter of 2024. However, the overall total increased by nearly 40,000, resulting in approximately 100,000 more than the estimates provided by either Desjardins or the federal government.
“Despite slight revisions in the short-term, our long-term population projection suggests that the government will require more aggressive reductions in NPR numbers to reach its ambitious target by the end of 2026,” the authors said.
Permanent Resident Numbers
The report also identified the rate of permanent resident (PR) admissions as an issue.
Immigration, Refugees and Citizenship Canada data used in the study showed there has been no decline in permanent resident admissions, despite Ottawa reducing its target for PR admissions last fall.
Annual permanent resident admissions likely increased by approximately 16,500 in 2024, assuming the number of new permanent residents in December 2024 is the same as it was the previous month, the report authors wrote.
The impact of external pressures on the government’s goals is still uncertain, Desjardins added, noting that corporate Canada has voiced apprehensions about labour shortages and could pressure the government to moderate some of its policies to ensure industry job vacancies are filled.
“We remain skeptical that the Government of Canada will be able to reach its target for admissions of newcomers, particularly NPRs,” the authors said. “The federal government has struggled to meet some policy objectives in the past, and the prospect of meeting its new immigration targets is especially daunting given the administrative challenges associated with executing such a significant policy shift.”
Any tariffs imposed by U.S. President Donald Trump could potentially affect Canada’s capacity to achieve its targets, the study said. If tariffs cause Canada to slip into a recession, it could slow demand for temporary labour.
“If that were to occur, Canada could become a less desirable destination for immigrants,” the authors said. “While this would be an unintended consequence of an undesirable outcome for the Canadian economy, it could help the federal government reach its population targets more quickly.”
