The 5% temporary resident cap (2025–2026)
Overview
In 2024, the Canadian government announced a plan to reduce the proportion of temporary residents — including international students, temporary foreign workers, and other permit holders — from approximately 6.5% of Canada's population to 5% by the end of 2026. This represented a significant policy shift away from the rapid expansion of temporary migration pathways that had occurred in the preceding years. The key measures include a cap on new study permit approvals, restrictions on the Post-Graduation Work Permit (PGWP), a review of LMIA-exempt work permit categories, and reductions in low-wage LMIA positions in some regions and sectors.
The reduction plan was introduced amid public concern about housing affordability, strain on public services, and the perception that temporary migration programs had grown faster than Canada's capacity to absorb them. The government framed the changes as restoring integrity to immigration pathways rather than reducing permanent immigration targets.
Note: immigration policy in Canada changes frequently. This page reflects the position as at May 2026. Current caps and limits should be verified on the IRCC website.
Legal basis
- IRPA s 10.1 — Ministerial Instructions mechanism used to set caps on Express Entry and study permit approvals
- Immigration Levels Plan 2025–2027 — the multi-year plan tabled by the Minister of Immigration, Refugees and Citizenship that sets targets for permanent and temporary residents
- IRCC Ministerial Instructions — study permit cap 2024 — set a national cap on new study permit approvals; allocated allocations by province
- IRCC Ministerial Instructions — PGWP 2024 — introduced the field-of-study requirement for college PGWP eligibility
How it works
Context: the temporary resident population
Between 2019 and 2024, Canada's temporary resident population grew significantly, driven by increases in international student enrolment, expansion of LMIA-exempt work permit categories, and humanitarian pathways. By mid-2024, temporary residents represented approximately 6.5% of Canada's population — approximately 2.4 million people across all categories. The government's stated target was to reduce this to approximately 5% by the end of 2026, implying a reduction of several hundred thousand temporary residents.
Study permit cap
Starting in 2024, IRCC introduced an annual cap on new study permit approvals. The cap:
- Allocates a maximum number of study permits by province/territory, based on population share
- Applies to applications for study permits at designated learning institutions (DLIs) at the post-secondary level
- Was set at approximately 364,000 approved study permits for 2024 (down from a higher number in prior years)
- Does not apply to extensions of existing study permits (continuing students are not affected)
- Does not apply to primary and secondary school students
PGWP field-of-study restriction
The PGWP field-of-study restriction (effective November 2024) requires college graduates to have studied in an IRCC-designated field in order to qualify for a PGWP. University graduates (bachelor's degree and above) are not subject to the restriction. The designated fields correspond to labour shortage areas: healthcare, STEM, trades, agriculture, and transport. See the PGWP eligibility concept page for the full field list.
LMIA low-wage restrictions
Starting in 2024, ESDC imposed temporary moratoria on LMIA approvals for low-wage positions in certain metropolitan areas with high unemployment rates (including Toronto, Vancouver, and Montreal Census Metropolitan Areas) in sectors not identified as essential (such as food service and retail). The specific sectors, regions, and periods subject to the moratorium have been updated over time.
IMP and open work permit review
The International Mobility Program (IMP) was subject to a review of LMIA-exempt categories. Some open work permit categories were narrowed or made subject to additional conditions. Employer-specific work permits became more commonly required in situations where open work permits had previously been available.
Effect on permanent residence targets
Despite the temporary resident reduction, Canada's permanent residence targets were maintained at approximately 500,000 new permanent residents per year under the Levels Plan 2025–2027, before being revised downward for 2025 and 2026 as part of broader immigration recalibration. The reduction in temporary residents was positioned as improving the conversion ratio — ensuring that temporary pathways lead to genuine permanent residence for those who arrive and contribute, rather than creating a large population on precarious status.