Feds considering cap on international students

The federal government will look at capping the number of international students admitted to Canada in the coming months, Immigration Minister Marc Miller told reporters, saying the system “has gotten out of control.” 

Why it matters: The number of people coming to study in Canada from abroad has surged, climbing to around 900,000 last year, and worsening a housing shortage that’s driven rents up by 22% over the past two years.

  • Miller said that a cap on international students would need to be negotiated with the provinces, which are responsible for regulating colleges and universities.

Catch up: While the federal government has stuck to a target of adding 500,000 new permanent residents to Canada every year, it has no target at all when it comes to non-permanent residents, the vast majority of whom are temporary workers or international students. 

  • That’s led to an explosion in the growth of non-permanent residents in Canada in the past couple of years.

  • According to data compiled by economist Mike Moffatt, Canada added just over 50,000 non-permanent residents in the first nine months of the average year between the years 1999 and 2016. In the first nine months of 2023, it added 654,000 non-permanent residents.

Why it’s happening: International students are now a key source of cash for colleges and universities, which can charge students from abroad significantly higher fees than they can their Canadian peers.

  • As provincial governments have frozen domestic tuition and cut funding for post-secondary institutions, they’ve become dependent on international students to make up the shortfall.

  • In Ontario, where most international students study, around three-quarters of tuition collected by public colleges comes from international students, and fees paid by students from India alone are now greater than funding from the province.

Zoom out: Capping permits is the federal government’s strongest tool to control the rapid growth of non-permanent residents, but provincial governments will also need to act to shore up the finances of colleges and universities if revenue from international students dries up.—TS