Ottawa to shift more temporary residents to permanent status as broad levels flatten

The 2026 federal budget, released Thursday, says the government plans to reform the Temporary Foreign Worker Program. The stated goal of the reform is to ensure the program lines up with regional labour market needs, improve processing times and strengthen employer compliance.

Details of the program review are scarce at this point, although the budget sets aside $151.5 million to implement the reforms. The federal government says it will work on the program reform with the provinces and territories.

A spokesperson for Immigration Minister Lena Diab said early Thursday she had no plans for a press conference to explain the changes at her department.

During an embargoed media briefing before the budget was released, Finance Minister Francois-Philippe Champagne said the issue of temporary workers varies significantly by region and sector.

“Depending where you are, there’s more pressure, the unemployment rate is not the same,” Champagne said.

“In a nutshell, we’re trying to be more bespoke, to respond to our market needs in a way that would support our businesses who need these temporary workers without putting pressure on places where the unemployment level is high.”

Between the broad target, the new program to grant permanent status to 200,000 temporary residents and the final year of a two-year program to give permanent residency to about 140,000 temporary residents, Canada could add more than 600,000 new permanent residents next year.

The government’s stated goal is to reduce the temporary resident population to five per cent of the total population by the end of 2027. The temporary resident population peaked at 7.4 per cent of the total population in October 2024 before dropping to 6.7 per cent, according to a Statistics Canada estimate released on July 1.

The government says it intends to work closely with the provinces and territories on the plan to give permanent status to 200,000 people. This work will include finding 100,000 temporary workers who are eligible for either Express Entry or the Provincial Nominee Program.

A backgrounder briefing document supplied by the minister’s office says the other 100,000 temporary residents will come from humanitarian programs. They include people who came to Canada through the Hong Kong permanent residence pathway and the Ukraine Family Reunification Pathway that started after Russia launched its full-scale invasion.

The department’s background briefing document says this humanitarian permanent residency plan will also allow it to process family sponsorships of permanent residents already living in Canada, and get those wait times closer to the 12-month target.

The current humanitarian and compassionate permanent residency application wait time is listed at more than 10 years.

Ottawa also plans to increase permanent residency spaces in the Provincial Nominee Program to give the provinces and territories greater ability to nominate people for permanent residency based on local labour market needs.

The Rural Community Immigration Pilot will also be made permanent. This pilot, which involved 14 communities, connected local employers with skilled migrants and opened a permanent residency pathway.

Immigration has become an increasingly fraught political topic in recent years, and has been blamed by the government and others for affordability and housing challenges.

Numerous polls, including the federal government’s own research, suggest that about half of Canadians think too many immigrants are coming here.

Michelle Rempel Garner, the Conservative immigration critic, suggested before the budget’s release that the government would “cook the books” by not including all new permanent residents in the broader target. She pointed out that the plan to grant permanent residency to temporary residents was not included in the broad target last year.

After the budget’s release, Rempel Garner accused the Carney government of structuring immigration intake numbers “to benefit wealthy corporate interests, at the expense of Canadian and newcomer workers alike.”

“Canadians were told to expect a sustainable plan,” she said. “But based on today’s numbers, what Mr. Carney meant by ‘sustainable’ is sustainable for corporate profit models, not for workers or Canada’s social infrastructure.”

Prime Minister Mark Carney has said immigration is back under control, citing significant reductions in the number of temporary workers and students coming to Canada since 2024.

The Bank of Canada published an article last month saying an aging population, a lower birthrate and lower immigration will all reshape the economy.

The bank said Canada’s population grew 0.5 per cent in 2025 — the slowest growth rate in more than a century, down from a historic annual average of 1.2 per cent. The bank said it expects that slower growth rate to continue for the foreseeable future.

The bank said this economic shift is being driven by multiple factors: more retirees and fewer young workers replacing them, changing consumer habits and changes in the housing market as people downsize their dwellings as they age.

The immigration annual report, also tabled Thursday, shows Canada welcomed about 393,000 new permanent residents in 2025, in line with the broad target of 395,000.

Almost 324,000 new permanent residents arrived in 2025, well below the target in that year’s levels plan of almost 674,000.

More than 3.3 million people held permits to work or study in Canada throughout 2025. This figure includes new arrivals and those who received a permit extension.

This report by The Canadian Press was first published Nov. 5, 2026.

David Baxter, The Canadian Press

by The Canadian Press

Ottawa to shift more temporary residents to permanent status as broad levels flatten

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