Canada’s Immigration Crisis in 2025: Balancing Economic Needs and Public Sentiment, By Chris Knight (Florida)
In 2025, Canada stands at a critical juncture, grappling with the fallout of a once-aggressive immigration policy that fuelled rapid population growth, but now faces a backlash from both the public and provincial leaders. Prime Minister Justin Trudeau's admission in November 2024 that his government "made some mistakes" on immigration marked a dramatic shift, leading to a significant reduction in net migration. However, this pivot has sparked tensions with provincial leaders like Ontario Premier Doug Ford, who demand more control over immigration to address labour shortages. Amid rising unemployment, housing pressures, and trade uncertainties with the United States, Canada's immigration crisis raises questions about economic strategy, social cohesion, and governance. There are lessons here for Australia, if it comes to its senses and reduces immigration.
Canada's immigration policy post-COVID was among the most ambitious in the developed world. Between 2022 and 2024, the country welcomed over a million newcomers annually, driving population growth to 3% in 2024, a rate rivalling developing nations like Angola. This growth, largely fuelled by temporary migrants, international students and foreign workers, was intended to address labour shortages and sustain an aging workforce. By 2023, Canada's population surpassed 41 million, with immigration accounting for nearly 98% of the increase.
The Trudeau government's rationale was rooted in economic logic: newcomers would boost GDP, fill low-skill jobs, and offset demographic decline. However, the policy's execution faltered. Rapid population growth strained housing, healthcare, and infrastructure, exacerbating affordability crises. In Toronto, rents soared, and makeshift rentals, like bathrooms converted into bedrooms, became symbols of the housing crunch. Public sentiment soured, with a 2024 Environics Institute poll showing 58% of Canadians felt immigration levels were too high, a sharp rise from 27% in 2022.
In response, Trudeau announced a drastic cut in November 2024, reducing net migration to 25,700 per quarter in 2025, down from a peak of over 400,000 in 2023. This was achieved by tightening temporary resident programs, including caps on international student permits and restrictions on temporary foreign workers (TFWs), while maintaining permanent resident targets at around 395,000 for 2025. The move aimed to "pause population growth" and ease infrastructure pressures, with projections estimating a 0.2% population decline in 2025 and 2026.
While the public largely welcomed the cuts, provincial leaders, particularly Ontario's Doug Ford, pushed back. Following a July 2025 meeting of Canada's premiers, Ford criticised federal Immigration Minister Marc Miller, demanding more economic migrants to address labour shortages. He vowed to use Ontario's constitutional powers to issue work permits, arguing the federal system was unresponsive to market needs. Ford's stance echoes earlier calls for a Quebec-style immigration model, where provinces have greater control over economic migrants.
Ford's argument hinges on Ontario's economic demands, particularly in sectors like construction and manufacturing. However, the labour shortage narrative is contested. Ontario's unemployment rate in 2025 stands above the national average of 7%, with 1.55 million Canadians unemployed, up 540,000 since July 2022. Youth unemployment is particularly stark at 14.2%, suggesting a surplus of domestic labour. Critics argue that increasing migration in a high-unemployment context risks further job competition, especially for low-skill positions, and could depress wages.
The push for more migrants also reflects corporate interests. Businesses, reliant on cheap labour from TFWs and international students, have lobbied against cuts, citing operational challenges. Yet, the exploitation of temporary migrants, often paid below minimum wage in precarious sectors like agriculture, has drawn scrutiny, with some labelling Canada's TFW program a "breeding ground for slavery." Ford's rhetoric may thus align more with business demands than labour market realities, raising questions about whose interests provincial autonomy would serve.
Canada's immigration recalibration occurs against a backdrop of economic fragility. Immigration has historically driven GDP growth, contributing nearly 100% of labour force expansion. A 10% reduction in immigration could shave 0.5% off GDP, risking recession. However, per capita GDP, a better measure of living standards, has stagnated, growing only 2.4% since 2016 compared to 11.7% in the U.S. This suggests that while immigration boosts aggregate growth, it dilutes individual prosperity when infrastructure lags.
The housing crisis, exacerbated by rapid population growth, has begun to ease with immigration cuts. Rents dropped 2-8% in major cities in 2025, and the housing supply gap is projected to shrink by 670,000 units by 2027. Yet, sectors like education face challenges. Post-secondary institutions, reliant on international student tuition, are grappling with budget shortfalls due to study permit caps, threatening their financial stability.
Complicating matters are trade tensions with the United States, Canada's largest trading partner. In 2025, U.S. President Donald Trump imposed 25% tariffs on Canadian goods, prompting retaliatory tariffs and threats from Ford to cut off electricity and nickel exports. These tariffs jeopardise industries like Ontario's auto manufacturing, where parts cross the border multiple times, risking plant closures and job losses. Immigration Minister Marc Miller warned that up to a million jobs could be at stake, underscoring the intertwined nature of trade and labor. Increased migration, as Ford advocates, could strain an economy already vulnerable to external shocks.
The immigration crisis has produced a surge in anti-immigrant sentiment, challenging Canada's reputation as a multicultural beacon. Hate crimes doubled between 2019 and 2023, and online xenophobia has proliferated. Immigrant communities, particularly international students, face scapegoating for housing and job woes, despite evidence that underfunded public services and zoning restrictions are root causes.
In conclusion, Canada's immigration crisis in 2025 reflects the tension between economic ambition and social reality. The pivot from high migration to sharp cuts has eased public concerns but ignited a provincial revolt led by figures like Doug Ford, who prioritise labour demands over unemployment realities. Trade tensions with the U.S. and rising xenophobia, further complicate the path forward.
https://www.macrobusiness.com.au/2025/07/canada-faces-migration-revolt/
Canada faces migration revolt
In the years since the pandemic, Canada has run one of the largest migration programs in the world in per capita terms, with its level of population growth rising to almost 3% in 2024, according to figures from the World Bank.
This left Canada ranked 11th in the world for population growth, sandwiched between Angola and the Central African Republic.
Then, in November 2024, Canadian Prime Minister Justin Trudeau admitted his nation had pursued the wrong path on immigration.
In a video address posted to YouTube, Trudeau said his government had "made some mistakes" on immigration and outlined a plan to dramatically reduce Canada's net intake over the next 3 years.
"In the last two years, our population has grown really fast, like baby boom fast."
"So we're doing something major. We're reducing the numbers of immigrants that will come to Canada for the next three years."
"Bad actors, like fake colleges and big chain corporations, have been exploiting our immigration system for their own interests."
Despite promises to cut migration being made across the Anglosphere for well over a decade, almost universally resulting in completely the opposite outcome in most instances, Trudeau was true to his word.
Canada has since reduced its net migration intake to just 25,700 people per quarter, a tiny fraction of the more than 400,000 net entrants per quarter seen at the peak in 2023 and less than 1/3 of what was the norm for this time of year prior to the pandemic.
The Trudeau government achieved this by reversing flows of temporary migrants into Canada while maintaining the permanent intake in broadly the same ballpark of where it was.
While this shift has been warmly received by a Canadian public that has opposed high migration, including a majority of migrants, other elements of Canadian society have reacted much less positively to the Trudeau government keeping its promise.
Following the conclusion of a meeting of the premiers of Canada's various provinces and territories, various leaders called for an increase to economic migration levels to meet their labour needs and stated that they would use their constitutional powers to wrestle more control over immigration, including issuing work permits.
Ontario Premier Doug Ford has been particularly vocal on the issue, criticising the federal Immigration Minister and vowing that Ontario would issue its own work permits for migrants into the province.
"We need the Prime Minister to be very, very clear with his minister. She needs to work with the provinces and territories to fix Canada's immigration system and make it more responsive to economic and market needs," Ford said.
Looking at the state of the Canadian labour market, it's challenging to see how this sort of commentary or the push for higher numbers of migrant workers beyond the already normal level of permanent migrants is justified.
Since July 2022, the number of unemployed Canadians has risen by 540,000 to 1.55 million people. The headline unemployment rate surged from 4.8% to 7.0% in May of this year.
Ontario's unemployment rate is especially high, tracking well above the national average. There is clearly no shortage of labour.
Source: Ben Rabidoux
Meanwhile, there continues to be high levels of uncertainty about how trade tensions with Canada's largest trading partner, the United States, will be resolved and what impact that could have on the Canadian economy if the various tariffs remain at proposed levels.
We increasingly find ourselves in an Anglosphere world whereby high migration doesn't make sense from a social or economic perspective, yet it is pursued by policymakers anyway, despite serious employment risks for workers and rising unemployment.
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