The Real Immigration Story in Budget 2026 Isn’t the Targets

From: Parisa Mahboubi
To: Hon. Lena Metlege Diab, Minister of Immigration, Refugees and Citizenship
Date: November 13, 2026 
Re: The real immigration story in Budget 2026 isn’t the targets

Last week’s federal budget kept Canada’s immigration targets steady: 380,000 permanent residents and 370,000 new temporary arrivals a year from 2027 to 2029.

Those numbers are reasonable. They match last year’s plan, and the 2027 figure is what the C.D. Howe Institute’s Immigration Targets Council recommended in September. While the council’s 2028-2029 figures were somewhat lower, its members stressed that who Canada selects matters more than small differences in the total.

Meanwhile, the formal targets don’t tell the whole story.

The more consequential changes sit outside the target. The plan creates “additional spaces” in 2027 for up to 200,000 temporary residents already in Canada to become permanent residents, even as last year’s one-time pathways for about 115,000 protected persons and 33,000 workers continue. Half these spaces are for workers eligible for Express Entry or the Provincial Nominee Programs, selected with the provinces. The rest appear to go to people who have been waiting years for permanent status on humanitarian grounds.

This is precisely what the council warned against. It urged Ottawa not to repeat last year’s approach of adding permanent resident streams outside the announced total. Ottawa says the measure will improve efficiency and support the economy without adding pressure on services, since these people already live here. Its main effect, though, is to help the government meet its temporary resident goal on paper by reclassifying people already here from temporary to permanent status. It also pushes 2027 permanent resident admissions above the 380,000 headline number by up to 200,000, plus whatever remains of last year’s one-time pathways, whose size no one can yet calculate. Rather than addressing past mistakes, it introduces yet another one-time measure. Even the economic benefit is uncertain, since Ottawa has not said how many will be chosen through Express Entry.

The measure also tries to address a temporary population that is not yet under control. As of July 1, there were nearly 2.8 million non-permanent residents, or 6.7 percent of the population, just half a percentage point below the 2024 peak. Last year, the government committed to getting below 5 percent by the end of 2027. That would now mean close to 700,000 fewer people in 18 months, three times the pace of decline over the past year. This year’s plan drops that deadline from its main text; the 5-percent goal survives only in a footnote, without a date.

Setting targets that can’t be met does little for credibility, but quietly retreating from them doesn’t help either. Canada needs a clear ceiling and a gradual path below it. When temporary numbers far outstrip permanent spaces, many people whose permits expire will neither qualify to stay permanently nor leave. This leaves them open to exploitation, can distort wages in lower-skilled jobs, risks a growing undocumented population and weakens public confidence in the entire immigration exercise.

In 2000, Canada had about 226,000 non-permanent residents, roughly the number of permanent residents admitted that year. Today, the temporary population is about seven times the number of permanent residents admitted in 2025. Most temporary residents cannot become permanent, so the population will decline only if many leave. The government aims to reduce arrivals and transition more people to permanent status. But repeated special pathways encourage temporary residents to stay in hopes of permanent residency, which undermines limits on new arrivals.

Who receives those permanent spots matters most.

Recent research finds that since Canada introduced skills-based candidate rankings through Express Entry in 2015, new permanent residents’ earnings have improved markedly, while the earnings gap for recent temporary-resident men has nearly doubled. Prioritizing that pool for permanent status without rigorous selection risks reversing a decade of gains.

Yet the new plan moves the other way. It cuts Federal High Skilled admissions, selected through Express Entry, from 111,000 to 100,000 a year in the economic stream, while provincial Atlantic and rural programs together exceed the Federal Stream. Many provincial nominees never rank through the Express Entry system, and the 100,000-worker transition will further widen the provincial share. Nominee programs have often been used to fill lower-wage jobs, and many nominees eventually leave their province. Economic selection should not become a provincial fiefdom. Transition should take place through a strengthened Express Entry system that ranks candidates on human capital, not vague criteria such as last year’s “strong roots.”

Ottawa should publish a single target for permanent admissions that includes every pathway, set a firm ceiling for the temporary resident population, backed by better data on who stays and who leaves, and apply transparent, skills-based standards to all transitions. Steady headline targets are a good start. But Canadians, employers and provinces need to see the whole picture to trust the system and plan around it.

Parisa Mahboubi is an associate director of research at the C.D. Howe Institute.

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The views expressed here are those of the author. The C.D. Howe Institute does not take corporate positions on policy matters.