Canada opens gates to H-1B visa holders, slashes mass immigration
The measures, set out in Budget 2025 and the federal government’s new 2026–2028 Immigration Levels Plan, signal a calibrated shift from mass migration to skills-driven growth.
Budget 2025 introduces a new pathway allowing up to 33,000 US H-1B visa holders and other high-skilled temporary workers to transition directly to permanent residency by 2027. (File Photo) In its sharpest immigration overhaul in decades, Canada has announced plans to slash temporary resident admissions by 25–32 per cent starting next year, while opening a new fast-track permanent residency pathway for tens of thousands of US-based H-1B visa holders and other high-skilled professionals. The measures, set out in Budget 2025 and the federal government’s new 2026–2028 Immigration Levels Plan, signal a calibrated shift from mass migration to skills-driven growth.
Under the plan, Canada will admit 385,000 new temporary residents in 2026, down 25 per cent from the 516,600 targeted in the previous 2025–2027 framework, before reducing further to 370,000 annually in 2027 and 2028. This includes 230,000 temporary foreign workers and 155,000 international students in 2026, tapering to 220,000 workers and 150,000 students the following year. Immigration lawyer Sumit Sen said the figures represent about a 30 per cent drop in temporary resident numbers compared to earlier targets.
At the same time, Budget 2025 introduces a new pathway allowing up to 33,000 US H-1B visa holders and other high-skilled temporary workers to transition directly to permanent residency by 2027. The initiative aims to attract global talent in technology, engineering and research, while countering U.S. protectionism and bolstering Canada’s innovation economy.
Permanent resident intake will remain steady at 380,000 per year through 2028. Within this, economic class immigrants, which means skilled workers, entrepreneurs, and professionals, will account for 64 per cent of total admissions, up from 59 per cent, reflecting Ottawa’s focus on aligning immigration with labour market needs.
“We’ve exceeded our capacity in recent years,” Finance Minister François-Philippe Champagne said while tabling the budget, citing a recent Environics Institute poll showing that 56 per cent of Canadians believe immigration targets are too high. Champagne said the new approach focuses on “building a stronger Canadian economy” through balanced growth.
The government said earlier steps such as a 35 per cent cut to international student approvals this year and a 50 per cent reduction in new temporary foreign worker entries, had begun to “bend the curve,” with temporary residents projected to fall below five per cent of Canada’s population by late 2027.
Budget 2025 also earmarks $1.7 billion over 13 years for international researchers and $97 million to streamline foreign credential recognition, with Immigration Minister Marc Miller describing the strategy as a move toward “high-impact” talent, particularly in rural and remote regions affected by U.S. tariffs and shifting supply chains.
Reactions were divided. The Canadian Chamber of Commerce welcomed the plan’s economic focus but warned that deeper worker cuts could worsen shortages in agriculture and healthcare. Universities, facing a 65 per cent plunge in new study permits for 2026, described the changes as a blow to research collaboration and campus diversity. Migrant rights advocates denounced the new cuts”. This is a shocking attack on refugees and migrants,” said Syed Hussan, executive director of the Migrant Rights Network.
Economists predict a short-term easing in rental markets as population growth slows, but caution of wage inflation in lower-skilled sectors. With unemployment among recent immigrants at 11.1 per cent, twice the national rate, Ottawa’s bet is that fewer, better-matched arrivals will help restore faith in a system that brought in over one million temporary residents in 2023.
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