Cap hammers international student enrollment as Ontario colleges brace for more changes

The Ontario government and its public colleges are both sounding the alarm about a looming labor shortage as the impact of a cap on international students begins to ripple through the province’s post-secondary sector.

Early this year, as part of a plan to reduce the number of temporary residents, the Trudeau government introduced a strict cap on the number of international students that colleges and universities could accept.

While Ontario’s 44 post-secondary institutions continue to study the impact of the reduction, colleges say student numbers have already dropped after the initial enrollment reduction.

“We’ve certainly seen the impact of that,” Marketa Evans, president and CEO of Colleges Ontario, told Global News. “In September of last year, the number of international students at Ontario colleges is about half of what it was in September of last year.”

The federal cap will become even stricter next year, when Canada issues 437,000 study permits, a 10 percent drop from the 485,000 permits issued in 2024.

The substantial decline has left colleges in two separate battles: trying to maintain their financial health while continuing to produce enough graduates to fill vacancies in Ontario labor markets.

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This latter concern appears to be the top priority for the Ford government’s recently appointed Minister of Colleges and Universities, Nolan Quinn.

“We are more concerned about the labor market,” Quinn told Global News. “There are shortages in the labor market, whether it’s in STEM, healthcare or skilled trades.”

He added: “We must focus on the labor market and the needs of the labor market, that is our most pressing issue.”

At an event at Humber College on Thursday, Premier Doug Ford highlighted the provincial need according to his government’s estimates.

“Over the next decade, we need more than 500,000 additional workers in skilled trades, including 100,000 workers in the construction sector alone,” he said, highlighting the province’s $190 billion infrastructure capital plan over the next decade.

Colleges Ontario calls it baffling that provincial and federal priorities are not aligned.

“We spend so much energy and effort to grow the electric vehicle and battery factory sector in Ontario, but we don’t have the human power to get behind it,” Evans said. “We’re essentially cutting off that talent pipeline just when people need it most.”

While Evans emphasizes that the biggest problem posed by the international student cap will be in the Ontario labor market, it also poses a financial challenge for many colleges.

A panel convened by the Ford government to study the financial health of the post-secondary sector before the cap was implemented found it was too dependent on international students and needed a $2.5 billion cash infusion from the province.

The expert group, established in March 2023, concluded that the Ford government’s 2019 10 percent tuition cut and subsequent freeze, combined with the historic underfunding of post-secondary education, posed a “significant threat” to the sector’s viability .

Earlier this year, after the international student cap was announced, the government rolled out $1.3 billion in financial support for the sector, including a focus on efficiency improvements.

Evans said the money was an interim measure while colleges continued to adapt to the sector, with around 11 colleges dipping into a dedicated efficient fund.

“As we said at the time, a very good first step to ensure some immediate stability for the sector while we worked things out,” Evans said.

“Many of those measures are two- or three-year measures and we see that as a kind of bridge to a broader conversation about what financial stability will look like once the dust settles on the state of play with the other revenue sources. ”

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