Canada is reshaping its immigration system by placing a cap on temporary residents. The government’s goal is to reduce their share of the national population to five percent by the end of 2026. This shift responds to growing concerns about housing shortages, labour market pressures, and demand on public services. While the new approach tightens rules for study permits, post-graduation work permits, and temporary foreign worker approvals, it also expands pathways to permanent residency for skilled workers and students already in the country.

What the Numbers Reveal

Recent data show that simply reducing new permits does not instantly shrink the number of non-permanent residents. For example:

• In 2024, new study permits fell by 24%, yet the year-end stock declined only 4%.
• Work permit issuances dropped by 4%, but their year-end stock rose 19%.

This means that renewals, extensions, and transitions to permanent residency play just as big a role as new permits in shaping overall population levels.

How Residency Status Evolves

Tracking permit holders from 2018 to 2022 shows clear trends:

• 64% to 79% percent of permit holders kept valid status after one year.
• By the third year, that share fell to 36% to 38%.
• Study permit holders had the highest retention rates, often through continued studies or the Post-Graduation Work Permit Program.
• Holders of International Mobility Program (IMP) permits were the most likely to transition into permanent residency, with nearly half achieving PR within three years.

Why This Matters for Policy?

The study highlights that the dynamics of residency status among temporary residents in Canada are complex. It’s not just about who enters, but also about who stays, who transitions to permanent residency, and who exits the system. As the government balances population growth with housing and labour needs, these findings stress the importance of designing policies that align both short-term permit rules and long-term immigration pathways.

Understanding the dynamics of residency status among temporary residents in Canada is crucial at a time of major policy change. With caps on new entries and growing emphasis on permanent residency, future outcomes will depend on how well programs are structured to support both newcomers and Canada’s broader economic and social goals.

At ImmigCanada, we help international students, workers, and families identify the right programs to transition from temporary status to permanent residency. If you’re planning your pathway or exploring your options, our experts can guide you every step of the way. Contact ImmigCanada today to take the next step toward your Canadian future.