The Canadian Education Boom Goes Bust!

A lack of federal and provincial funding for colleges, combined with federal restrictions on new international students, has created a perfect storm for higher education. This week, that storm made a direct hit on one of Toronto’s most prominent institutions.

George Brown Polytechnic has officially initiated a “mass termination” process, as mandated by provincial labor rules when an employer plans to lay off 50 or more staff within four weeks. According to a government-mandated “Form 1” notice dated March 4, the college is laying off 51 employees, consisting of 22 hourly workers and 29 salaried employees.

The figures behind this decision are alarming. Full-time enrollment at George Brown has fallen by 29%, from 22,000 in the winter 2025 term to 15,889. The impact is most evident at the St. James campus, where several hospitality and culinary arts programs were suspended last fall. Currently, that campus is operating at just over half the capacity it had this time last year.

In a statement, a spokesperson for George Brown described the layoffs as a “last resort, taken only after exploring all other cost-saving measures and conducting a comprehensive review of program delivery, workload, and operational requirements.”

Why Is Ontario’s Bailout to Local Colleges Not Enough?

Despite the Ontario government’s commitment to invest $6.4 billion into the sector and lift the tuition fee freeze that institutions have long criticized, the outlook remains grim. Experts point to George Brown President Gervan Fearon’s warning to his staff in a February 2026 email, in which he stated he did not “see these changes” (referring to the government measures) as a solution to the broader financial challenges facing the sector.

Piecemeal public funding is seen as a short-term fix rather than a long-term solution.

Internal slides from a recent faculty meeting at George Brown identified four primary factors driving the current crisis:

A severe drop in international enrollment
A decrease in domestic enrollment across all institutions
Multi-year tuition freezes and low government grants
Rising labor costs

Another college feeling the effects of this crisis is Humber Polytechnic. Earlier this week, Humber also moved forward with layoffs after voluntary exit packages failed to close a projected fiscal gap for 2026-27. This comes despite colleges across Ontario having already canceled or suspended more than 600 programs as cost-cutting measures.

Union leaders, some with decades of experience at these institutions, say they have never witnessed “mass termination” notices of this magnitude. Jeff Brown, lead steward for George Brown faculty, told a local media outlet, “What we’ve seen at George Brown over the past few months is a clear shift in the justification the college is providing for faculty and staff layoffs.” He noted that while previous cuts targeted specific closed programs, management is now indicating a need for “cuts across the board.”

What Brought Us Here?

The lack of funding is not a new challenge for Canadian colleges; they have been dealing with it for decades, particularly since around 1970. Historically, Ontario has been the province most affected by these financial constraints. However, it is commendable that they adapted by tapping into a new market: international students.

This trend gained momentum around 2014-15. By the end of 2015, Canada was hosting 58,125 international students. This influx provided a significant boost to cash-strapped academic institutions nationwide. By the 2023-24 academic year, this number had surged to approximately 288,798 (holding both study and work permits, while those with only study permits were substantially higher), with nearly 60% coming from India (Statistics Canada).

What Did the Rewards Look Like?

In the 2023-24 academic year, international students contributed approximately $37.3 billion to the Canadian economy. This figure includes their spending on tuition, accommodation, and other expenses, all of which have a substantial impact on the country’s GDP and job market. This amount was projected to grow to $43 billion in the 2024-25 academic year. However, before that could occur, Canada imposed an enrolment cap in 2024.

Capping International Students:

In 2024, Canada experienced a 4% decline in international student numbers compared to 2023. However, the impact was particularly severe in 2025. Between January and November 2025, Canada saw 334,845 fewer new international student arrivals compared to the same period in 2024, representing a 60% decline in international student inflows and the revenue they generated.

This was a major setback.

For many years, “we’ve been able to pretend we’ve got a world-class university system, not because of our central and provincial governments, but because of our international students who have kept us afloat,” said consultant Alex Usher, president of Higher Education Strategy Associates. With fewer international students, colleges may have to tell Canadian students and their parents, “Maybe it’s time for you to pay,” or urge the government to increase funding for universities and colleges.

This seems like a reasonable proposition.

With a significant revenue source like international students suddenly curtailed by federal policy, colleges across Canada are now facing a precarious situation. “Labor costs can represent 70 to 75 percent of an institution’s expenses. Consequently, budget cuts often lead to job losses and staff reductions, with younger or contract employees typically being the first to be let go, along with salary freezes and hiring moratoriums,” Usher noted.

Economists predict that the sector is entering “a very, very unpleasant few years,” during which students may soon find themselves paying more for less. “Institutions will need to either find ways to reduce their operational costs or secure increased public funding. This funding could come from both the central and provincial governments or be sourced from higher domestic tuition fees,” they argue.

*All numbers reported above have been gleaned from Statistics Canada and media reports on Ontario colleges.

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