Canada Tightens Study Permit Caps and PGWP Rules

Canada's Immigration Minister, Marc Miller, has announced significant changes to the country's international student program, including a tighter cap on study permits and adjustments to Post-Graduation Work Permit (PGWP) eligibility. According to Miller, "The international student cap is here to stay," signaling a permanent shift in the country’s approach to managing international students.

New Study Permit Cap for 2025

Starting in 2025, Immigration, Refugees, and Citizenship Canada (IRCC) will limit the number of study permits issued to 437,000. This number represents a 10% reduction from the 2024 target of 485,000 new permits. The cap will stabilize further in 2026. This reduction is expected to result in 300,000 fewer study permits issued over the coming years, impacting many prospective international students looking to study in Canada.

This is part of a broader effort to ensure the immigration system remains manageable and sustainable. Miller noted, "Not everyone who wants to come to Canada will be able to—just as not everyone who wants to stay will be able to."

Provincial Attestation Letter Required for Master’s and PhD Students

In a significant policy shift, master’s and PhD students will no longer be exempt from requiring a Provincial Attestation Letter (PAL). Roughly 12% of the allocated study permit spots will be reserved for these advanced degree students, acknowledging their contribution to Canada’s labor market. The PAL was introduced earlier for many undergraduate and college students, helping IRCC verify the legitimacy of applications and control the issuance of study permits.

Stricter PGWP Eligibility Criteria

IRCC has also introduced new eligibility requirements for the PGWP. Starting November 1, university graduates will need to achieve a Canadian Language Benchmark (CLB) score of 7, while college graduates will require a CLB score of 5 to qualify. This change is expected to reduce the number of PGWPs issued by 175,000 over the next three years.

Limits on Spousal Open Work Permits

Another change affects the eligibility of spouses for open work permits. Spousal Open Work Permits will now only be available to the spouses of master’s degree students enrolled in programs lasting at least 16 months. This is expected to cut the number of spousal work permits by 50,000 over the next three years.

In addition, Spousal Open Work Permits will now be restricted to spouses of Canadian citizens or permanent residents employed in critical work sectors, regardless of the international student program.

Impact on the Temporary Foreign Worker Program

Canada’s unemployment rate has been steadily increasing since April 2023, now sitting at 6.6%. With more than 1.5 million unemployed in August 2024, the government aims to reduce the volume of temporary residents on work permits, including those coming through the Temporary Foreign Worker Program (TFWP).

Minister of Employment, Workforce Development, and Official Languages, Randy Boissonnault, emphasized that the TFWP should be used as a last-resort option and should never replace Canadian workers or lower wages. Despite this, Boissonnault acknowledged that 99% of Canada’s economic growth depends on immigration, a figure expected to rise to 100% by 2032.

Broader Immigration System Changes

These recent updates to the international student program are part of a larger overhaul of Canada’s immigration system. In January 2024, IRCC introduced the first-ever cap on study permits, alongside new restrictions on PGWP eligibility. This includes the exclusion of college programs with "curriculum licensing agreements" from PGWP eligibility and limiting spousal work permits to the spouses of master’s and PhD students.

The Immigration Levels Plan for 2025-2027 will also include a focus on reducing the number of temporary residents, such as those on study or work permits. Additional measures include pausing Labour Market Impact Assessments (LMIAs) for low-wage jobs in areas with high unemployment and considering stricter eligibility requirements for PGWP applications based on in-demand sectors of the Canadian economy.

Miller hinted at future changes, indicating that while permanent immigration levels won’t be drastically altered, the adjustments will be "significant" rather than "cosmetic." More details are expected in the coming weeks as Canada continues to reform its immigration system.