Who Gets Hurt When Canada Cuts International Student Numbers?
If you want to see the “dynamo effect” in action, look no further than the federal government’s decision to reduce the number of international students allowed into Canada.
Context: Ottawa has recently announced plans to issue even fewer international student visas in 2026, citing a need to reduce Canada’s temporary population. The Immigration Department will issue up to 408,000 study permits in 2026, down from 437,000 in 2025 and 485,000 in 2024.
On the surface, this decision appears sensible: a country facing an overabundance of temporary residents opts to limit their numbers, ostensibly for the benefit of Canadian citizens.
However, this view oversimplifies the situation. Well-intentioned decisions can yield unintended consequences, particularly in the context of existing market anomalies. While cutting the number of international students may offer Canada a short-term solution, the long-term costs for both the country and its domestic student population could be significant.
The GEBS Report: According to The Global Enrollment Benchmark Survey, 82% of universities in Canada reported a decline in undergraduate enrollments, and 71% reported fewer postgraduate enrollments. On average, Canadian universities have seen a 36% drop in bachelor’s degree enrollments and a 35% drop in postgraduate enrollments, the steepest declines among regions.
A striking 90% of universities cited “restrictive government policies” as the main reason international students are increasingly choosing not to study in Canada. In contrast, only 15% attributed the decrease in enrollment rates to the rising cost of living and tuition.
As the survey notes, “The ongoing IRCC policy changes—particularly the national cap on study permits, new proof-of-funds requirements, and shifting Postgraduate Work Permit (PGWP) eligibility—have created major uncertainty” among Canadian colleges.
Effects:
– Projected revenue losses of nearly $1 billion.
– Serious consequences for local Canadian students, as universities may be unable to provide additional services or courses due to funding shortfalls, thereby reducing the quality of education. For example, seven popular hospitality programs—such as food and nutrition management, event planning, and hotel operations management—may no longer exist.
– With fewer international students, who typically pay significantly higher tuition fees, universities will lose essential revenue streams.
– Expected job losses, program suspensions, and staff layoffs.
– Sixty per cent of colleges are preparing for budget cuts in 2026.
– Fifty per cent of institutions plan to reduce staffing next year.
– A record number of domestic students are anticipated in 2026, but there is no corresponding funding increase.
– International students are vital contributors to post-secondary research; losing them threatens Canada’s ambitions as a knowledge-based economy.
– Damage to Canada’s reputation as a reliable study destination.
As we approach 2026, we sincerely hope that our government is better prepared to address the fallout from this decision than it was when it welcomed students into the country.
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