Canada’s International Student Cut: A $300,000,000+ Mistake?

In a controversial move shaking Canada’s education system, the federal government has announced a dramatic cap on international student permits, slashing approvals by 300,000 over the next three years. This decision, aimed at addressing housing and immigration concerns, is now causing massive disruptions across colleges and universities—threatening thousands of jobs, shutting down programs, and risking billions in economic contributions.

Sheridan College Slashes 40 Programs—And It’s Just the Beginning

Sheridan College, one of Canada’s leading institutions, has taken a hard hit. Facing a projected 30% drop in enrolments, the college announced it will suspend 40 programs, review 27 more, and cut its programming by up to 30%. These changes translate to a $112 million revenue loss in the next fiscal year—a blow President Janet Morrison called “unavoidable.”

“Sheridan will look different, but our commitment to learning, discovery, and engagement remains the same,” Morrison assured in her statement.

But how can Canada maintain its global reputation for education when its institutions are being gutted?

Job Cuts, Campus Closures, and Empty Classrooms

Sheridan isn’t the only one reeling. Other major institutions across Ontario are scrambling to respond to the international student cap:

• Atlantic Canadian universities say Ottawa's cap on foreign student permits has cost the region an estimated  $163 million, according to a consultant's report.

• Mohawk College: Bracing for a $50 million deficit, the school plans to lay off up to 400 staff members, with notices starting December 2.

• Seneca Polytechnic: Forced to temporarily close its Markham campus and relocate students to other locations.

• Fanshawe College: Experiencing a 35% drop in international enrolments, it has slashed spending on workshops, travel, and new hires.

• Camosun College on Vancouver Island is also feeling the pinch. The school will see 400 fewer international students than budgeted this year, and is facing a projected $5 million deficit next year.

• Georgian College said under the new criteria, it expects a further drop of about 2,500 full-time international students. The impact has been significant, with the college projecting a $45 million dollar deficit for the 2025-2026 year. Over 100 full-time positions have been impacted, including the layoffs of 23 employees, to reflect the shortfall.

• St. Lawrence College in Kingston, Ont., said it has eliminated 30 administrative and support positions and warned of further job cuts after its foreign student enrolment dropped by 50 per cent.

The economic impact is undeniable. These students aren’t just tuition payers—they’re critical contributors to Canada’s local economies.

How Canada’s Economy Will Pay the Price

International students add billions to the Canadian economy each year. They rent apartments, shop locally, eat out, and often work part-time jobs. A decline in their numbers hits more than just schools:

1. Local Businesses Suffer: Restaurants, retailers, and service providers that depend on student spending are already feeling the pinch.

2. Job Losses: Colleges cutting programs means fewer teaching positions, administrative roles, and support jobs.

3. Housing Market Shifts: Developers banking on student rentals could see vacancies rise, creating financial ripples in the real estate market.

A Policy Backfire in the Making?

The federal government argues the cap is necessary to address housing shortages and concerns about private colleges exploiting international students. However, education leaders warn that the long-term consequences could be disastrous.

Alan Shepard, President of Western University, called for a pause on the cap, warning it will deter the “best and brightest” students from choosing Canada over competitors like the US, UK, and Australia.

“[These students] drive innovation, boost economic growth, and make extraordinary contributions to our communities,” Shepard explained.

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What’s at Stake?

If the current trajectory continues, Canada risks losing its position as a global leader in education. Competitor nations are already stepping up their recruitment efforts, offering incentives to attract the very students Canada is turning away.

The message is clear: if international students don’t feel welcome here, they’ll go elsewhere.

Can Canada Find a Balance?

While the housing crisis and immigration challenges are real, critics argue that capping international students isn’t the solution—it’s a Band-Aid that could cost Canada billions in the long run. Instead, policymakers must consider solutions that include:

• Increased funding for colleges and universities to reduce reliance on international tuition.

• Strategic housing investments to support both domestic and international students.

• Collaborations with provinces and schools to create sustainable growth plans.

The Bottom Line

With institutions like Atlantic Canadian Universities, Sheridan and Mohawk bearing the brunt of these changes, the broader question remains: Can Canada afford to alienate the very students who help fuel its economy?

One thing is certain—this policy is a gamble. Whether it pays off or results in long-term damage will depend on how quickly the government addresses the unintended consequences now surfacing across the country.

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In the meantime, if you are interested in studying in Canada , there are a plethora of opportunities despite all the changes and cuts. Speaking with a Regulated Canadian Immigration Consultant will set you on the path of education success in Canada. Get started today by scheduling a call with on of our consultants