The current struggle experienced by Canada’s public colleges and institutes is a case study in what can happen when a series of rapid-fire, top-down federal policy changes are made in a sector that welcomes tens of thousands of international students and generates more than $30 billion annually for the Canadian economy.

Just over a year ago, Ottawa launched a series of overlapping, hasty reforms which have harmed Canada’s public postsecondary training capacity and the communities that colleges and institutes serve. This, at a time when these public assets are needed more than ever, given the major economic shock our country is now experiencing.

To put it in perspective, Immigration, Refugee and Citizenship Canada (IRCC) has made more changes to the international student program in the past year than in the last decade. The most visible and impactful of these changes was the January 22, 2024 cap on study permit applications for international students, one of 13 major policy changes over a 10-month period.

Real issue, wrong target

In 2021, post-COVID recovery and demographic pressures drove a dramatic increase in immigration levels. Our dependency ratio – the number of non-working Canadians to working Canadians – was projected to be 2:1 by 2036.

So, growth became the objective as federal and provincial governments opened the doors to temporary residents, including international students, in an effort to ensure a steady supply of new talent for Canadian businesses, schools and other institutions.

Simultaneously, several Canadian cities and communities experienced housing shortages and we all saw the highest inflation in nearly 40 years. Pressure mounted for governments to quickly address the cost-of-living and lack of affordable housing.

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The measures that followed – particularly changes which were enacted in September 2024 to the post-graduation work permit program requiring colleges to demonstrate how their curriculum aligns with national workforce needs – represent a consequential overcorrection.

The federal government has effectively shifted the crisis from a housing shortage in parts of urban Canada to one that will see regional, rural and remote communities starved for students and skilled graduates. And in doing so, it has kneecapped the very institutions focused on training the homebuilders and health care workers Canadians rely on.

From bad to worse

In fall 2024, international student college applications were down 54 per cent – far below the 35 per cent target laid out by the federal policy.

Projections suggest things will get much worse this year.

Colleges and Institutes Canada recently commissioned an independent study by Higher Education Strategy Associates to better understand the impact of the IRCC policy reforms on communities across the country. The research identified several troubling trends.

Access to learning and support programs at risk

In many programs with lower domestic enrolment, international student fees help sustain these areas of study that are more costly to deliver while the students themselves fill out classes and cohorts. This in turn enables institutions to deliver more overall programming for Canadian students.

The additional fees have also helped colleges provide additional student supports such as mental health services, financial aid and expanded work-integrated learning opportunities.

Fewer international students means less funding and therefore fewer programs. That impact will be felt by Canadian learners whose access to training for in-demand jobs may be curtailed.

Training and talent pipelines under siege

Public colleges and institutes serve unique needs in their regions and communities, providing training that meets local labour demand, and serving as gateways for local talent. For example, a recent study from Statistics Canada found that that 81 per cent of international college students that remain in Canada stay in their province of study. Our research also found that nearly three quarters of college and institute programs – including in many science, technology, engineering and math fields that are essential to local talent pipelines – are no longer eligible for post-graduation work permits under the recent changes.

What this reveals is a disconnect between what communities tell institutions they need, and what the federal government deems a priority. In other words, when we starve an institution of its training capacity, we directly undermine local employers, industry and in some cases regional economic sustainability.

Local research and innovation capacity diminished

Public colleges and institutes help Canadian SMEs innovate, adopt new technologies and become more efficient. They boost productivity through partnerships with applied research offices, incubators and dedicated Centres for Innovation supporting local industry.

It isn’t surprising that across all the case studies we examined, institutions expect to see declines in revenue up to almost 20 per cent. Combined with stagnant or falling provincial support, institutions are forced to re-evaluate commercial research activities and place some on the chopping block.

Course correction

Late last fall, the House of Commons standing committee on citizenship and immigration conducted a study on the reforms to the international student program. Colleges and Institutes Canada had the opportunity to share policy recommendations.

Ultimately, the reforms – and the way in which they were rolled out – are preventing public colleges and institutes from doing what they do best: respond to the economic challenges of their communities in real time. As a result, in the most extreme cases, some rural, remote, northern and Indigenous communities are on the verge of losing education and training possibilities that serve local industry thanks to a blunt policy tool to address an issue primarily affecting urban centres.

To start setting things back on the right track, we believe several steps are required.

• Put a pause on any further reforms and allow the system to stabilize;
• Prioritize regional program alignment and develop a new post-graduation labour market strategy;
• Treat identical credentials in an identical manner, be they offered at a public college or university
• Protect future training and applied research capacity through stable and sustained system-level funding to public postsecondary institutions.

One sign of strong leadership is learning from one’s mistakes and improving based on hard lessons. There is time to course correct to ensure the international student program benefits Canada’s workforce and economy. This is especially urgent given the threat of a looming Canada-U.S. trade war and the need to future-proof Canadian industries.

By collaborating with public colleges and institutes, we can ensure important policy challenges, such as delivering the critical workforce training Canadian communities need, supporting the economic vitality and resilience of Canadian industries and protecting the integrity of our immigration system, aren’t thwarted by misguided political decision making.