By Mata Press Service

For the first time in decades, Canada could see its population growth grind to a halt.

A new analysis from the federal Parliamentary Budget Officer (PBO) suggests the country’s population may effectively flatline in 2026 as Ottawa moves to rein in the number of temporary residents while keeping permanent immigration levels relatively steady.

The report examines the federal government’s 2026–2028 Immigration Levels Plan and concludes that the shift in policy will temporarily slow Canada’s rapid population expansion before growth resumes at a more modest pace.

For a country that has long relied on immigration to drive labour force expansion and economic growth, the findings signal a notable demographic turning point.

Population growth pause

According to the Parliamentary Budget Officer’s projections, Canada’s population growth is expected to drop to zero in 2026, largely due to federal measures designed to reduce the number of people in the country on temporary permits.

Growth is forecast to recover gradually after that, reaching about 0.3 percent in 2027, before stabilizing around 0.8 percent annually in the years that follow.

Even then, the pace will remain slower than Canada’s historical average population growth of roughly 1.1 percent per year.

The projected slowdown stands in stark contrast to the rapid expansion Canada experienced in recent years, when the country posted some of the fastest population growth rates among developed nations.

That surge was driven largely by record immigration levels and a dramatic rise in temporary residents such as international students and foreign workers.

Canada’s population growth has been closely tied to immigration policy for decades, but the scale of the recent increase caught many communities off guard.

The number of non-permanent residents — a category that includes international students, temporary foreign workers and asylum seekers — grew sharply in recent years.

By 2024, they accounted for about 7.6 percent of Canada’s total population, a historically high level.

The rapid influx sparked intense debate across the country, particularly around housing shortages, strained infrastructure and pressure on health care and social services.

Federal officials have since acknowledged that the pace of growth created challenges for housing supply and urban infrastructure, especially in large metropolitan areas such as Toronto and Vancouver.

The government’s response has been to recalibrate immigration policy by tightening controls on temporary migration while maintaining a steady flow of permanent newcomers.

A central objective of Ottawa’s strategy is to reduce the share of non-permanent residents in the population.

The federal government has set a target of bringing the proportion of temporary residents down to below five percent of the population by the end of 2027.

Policy changes affecting international student permits, temporary foreign worker programs and other immigration streams are expected to play a major role in achieving that goal.

The Parliamentary Budget Officer’s analysis suggests the government is on track to meet that target if current policies remain in place.

As the number of temporary residents declines, the overall pace of population growth will also slow in the short term.

Despite the tightening around temporary residents, Canada will continue to admit large numbers of permanent immigrants.

Under the federal 2026–2028 Immigration Levels Plan, Ottawa intends to welcome about 380,000 new permanent residents annually over the three-year period.

While that represents a modest reduction from some recent record targets, it remains high by international standards.

The government says maintaining strong permanent immigration levels is essential to address labour shortages and offset Canada’s aging population.

A significant portion of these permanent residents will come from people who are already living in Canada under temporary permits.

Federal programs are increasingly designed to transition international students and temporary workers into permanent residents once they have established themselves in the country.

One initiative outlined in the plan is expected to convert 148,000 non-permanent residents into permanent residents in 2026 and 2027.

Because these individuals are already living in Canada, the move changes immigration statistics but does not add to the country’s overall population.

The PBO report suggests Canada is entering a period of demographic recalibration.

After several years of unusually rapid population growth driven largely by temporary migration, federal policy is now shifting toward a more controlled and predictable pace.

The government’s approach reflects an attempt to strike a balance between two competing pressures.

On one hand, Canada needs immigrants to sustain economic growth and support the labour market as the population ages.

On the other hand, infrastructure, housing supply and public services in many cities have struggled to keep up with the recent pace of population expansion.

Slowing the growth of temporary residents is seen as one way to ease those pressures while still maintaining immigration as a cornerstone of Canada’s long-term demographic strategy.

Beyond the immediate policy adjustments, some experts say Canada is approaching a much larger demographic shift.

Dan Hiebert, a University of British Columbia geography professor who studies human migration, says the country is moving toward a future where immigration will become the sole source of population growth.

“Natural increase in Canada is going to hit zero really soon. Maybe 2029, maybe 2030, give or take, right? And at that point, all population growth is going to be immigration-related, like 100 per cent,” he told Canadian Press.

“It means that wherever the government of Canada, and in particular Immigration, Refugees and Citizenship Canada, wherever it sets that immigration number at, that’s the amount the population is going to grow. So that’s historically unprecedented.”

Natural increase refers to the difference between births and deaths within a country.

Canada’s birth rate has been declining for years, while the population continues to age. As a result, the number of deaths is expected to eventually equal or exceed the number of births within the next decade.

When that happens, immigration will become the only factor driving Canada’s population growth.

Hiebert says the reality that immigration will soon determine the entire pace of population growth means Canada may need to rethink how it plans immigration policy.

Currently, the federal government sets immigration targets through a three-year Immigration Levels Plan, which outlines the number of newcomers expected each year.

But if immigration becomes the sole driver of population growth, the decisions made in those plans will have even greater long-term consequences.

“So, we’re racing toward the future without actually thinking of where we’re racing toward,” Hiebert said.

“We don’t know what the finish line looks like. We just know what this little leg of the race is looking like.”