Canada may raise immigration levels as population growth hits lowest since WWII

Canada could raise immigration levels as the country grapples with its slowest population growth since the Second World War, Immigration Minister Lena Diab has indicated, hinting at a potential shift in policy after Ottawa spent the past two years tightening admissions.

Diab said the country needs more people to deliver Prime Minister Mark Carney’s economic agenda, even as housing affordability and pressure on public services remain concerns. The government is expected to unveil its updated immigration plan in November, although the minister did not disclose whether it would revise existing admission targets or by how much.

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“We’ve taken a step backwards on immigration. Our population increase. It was the slowest population growth since World War II. Again, that’s not me saying it. That’s the numbers,” Diab said at a press conference in Kitchener, Ontario, on Friday. “We have an ambitious agenda. We are going to want to drive growth. We do need people.”

Her remarks come weeks after Carney told The New York Times in September that Canada would eventually resume a “controlled increase” in its population once its immigration system was fully under control.

The comments point to a possible recalibration of Canada's immigration policy, which was tightened after a sharp rise in arrivals in the early 2020s intensified concerns about housing affordability, infrastructure and access to social services.

“As the prime minister said, we want to have our economy be the best in the G7, and in order to do that, I need to use the levers that I have in my role as immigration minister,” Diab said.

When asked why Carney had outlined the policy shift first to an American media outlet, Diab did not elaborate, saying only that the revised plan would be released “in November as it’s scheduled.”

From immigration cuts to a possible controlled increase

Canada began cutting its immigration targets in 2024 under former prime minister Justin Trudeau, following a period of elevated admissions. Carney subsequently campaigned in the 2025 federal election on a promise to “return immigration to sustainable levels”.

His government has since set annual permanent-resident admission targets at 380,000 for each of 2026, 2027 and 2028, down from the previous administration’s target of 500,000 a year. The 2025 federal budget also outlined a plan to reduce the number of temporary residents in 2026 by 43%.

However, the latest population figures have added a new dimension to the debate over how many newcomers Canada needs to sustain economic growth.

Statistics Canada estimated the country's population at 41,798,407 on July 1, 2026, up by 189,425, or 0.5%, from a year earlier. The July-to-July growth rate was the lowest since 1944-45.

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The demographic slowdown comes as Canada confronts an ageing population and a changing labour market. A Bank of Canada analysis published in October concluded that ageing and declining immigration were reshaping the economy by reducing the size of the workforce and altering consumption patterns.

A smaller pool of workers could complicate efforts to expand economic output, particularly as the government pursues its ambition of making Canada’s economy the strongest in the G7. Immigration policy is therefore likely to remain a balancing act between supplying workers, managing population growth and ensuring housing and public services can accommodate new arrivals.

The debate is also drawing political opposition. Conservative MP Michelle Rempel-Garner has previously argued that immigration targets should go “way down” in response to Carney's remarks about a “controlled increase”.

The C.D. Howe Institute, a Toronto-based think tank, has recommended annual permanent-resident admissions of 380,000 in 2027, 350,000 in 2028 and 340,000 in 2029, according to CTV News. The projections offer one indication of how future targets could be calibrated, but they are recommendations rather than government policy.

What a policy shift could mean for Indians in Canada

For Indians working, studying or seeking permanent residence in Canada, any change in immigration levels could influence the longer-term outlook, but a higher overall target would not automatically mean easier entry or faster access to permanent residency.

The distinction between permanent and temporary immigration will be particularly important. The government's existing plan calls for 380,000 permanent-resident admissions annually from 2026 to 2028, while separately targeting a 43% reduction in temporary residents in 2026.

A future increase in immigration levels could therefore coexist with tighter controls on temporary arrivals, depending on the categories and objectives prioritised in the November plan.

For Indian professionals hoping to work in Canada, the revised policy could offer clues about future labour-market needs and the government's approach to attracting skilled workers. For international students and temporary workers, however, the direction of policy will depend on whether Ottawa changes admission rules for their respective categories, rather than simply raising the overall population or permanent-resident targets.