Canada Slows Down: Immigration Tightening Shrinks Population Growth

In the first quarter of 2025, Canada’s population grew by just 0.6%. It's the lowest rate in four years. The reason? Immigration rules are getting tighter.

This article breaks down what’s causing the slowdown and how it affects foreign workers, students, and employers in Canada.

Context: A Sharp Drop in Non-Permanent Resident Growth

Canada's demographic engine has been driven for years by immigration, particularly by the arrival of non-permanent residents such as international students, temporary foreign workers, and asylum seekers. However, in early 2025, the federal government introduced stricter rules to address housing pressure, system backlogs, and public concerns regarding immigration levels.

According to Statistics Canada, inflows of non-permanent residents fell from 184,495 in Q4 2024 to 148,289 in Q1 2025. This 20% decline coincided with Canada's overall population growth rate falling to just 0.6%, the lowest since 2021.

The largest cuts were observed in two major categories: study permit approvals and employer-sponsored temporary foreign workers under the LMIA process. Meanwhile, provinces like Quebec also implemented regional moratoriums, such as the ongoing freeze on LMIA applications in construction sectors within urban zones.

This contraction in intake has ripple effects, not only for immigrants but also for the sectors that rely on foreign labour to meet staffing needs.

Key policy changes include caps on international student admissions, stricter work permit approvals under LMIA, and delays in permanent residence processing.

Implications for Temporary Residents and Employers

Key Impacts by Immigration Category

Impact on Immigration Pathways

The slowdown in temporary resident intake is also disrupting long-term immigration goals. Many foreign workers rely on LMIA-based employment to become eligible for Canadian permanent residency through the Canadian Experience Class (CEC) or Provincial Nominee Programs (PNPs).

With fewer job offers being approved under LMIA rules, and longer timelines for PR applications, candidates face growing uncertainty. Express Entry draws have become more selective, often targeting sector-specific skills or francophone applicants. Fewer all-program draws were observed in early 2025, and minimum CRS cut-offs remained elevated.

In addition, international students are seeing tighter restrictions on access to post-graduation work permits (PGWPs), especially those studying at private colleges or outside of public partnerships. These changes may shrink the future pipeline of PR-eligible graduates.

Applicants in lower-priority sectors or with moderate CRS scores are now forced to reassess timelines or seek regional streams with fewer barriers (particularly in French-speaking or rural areas).

Slower work permit approvals are delaying PR eligibility for in-Canada workers. Express Entry draws have become less frequent and lower in volume.

International students who expected to transition to post-graduation work permits may face limits or new requirements under recent IRCC guidelines.

What Immigrants and Employers Can Do

• Audit your LMIA strategy: Ensure roles meet updated requirements
• Consider IMP alternatives: Some streams bypass LMIA entirely
• Target bilingual or regional programs: French-speaking applicants and rural pilots may face fewer restrictions
• Act early: Processing delays mean every month counts in 2025