the unwinding of canada’s population boom has begun

Canada’s three-year trend of robust population growth came to a near halt in Q1 2025. Data from Statistics Canada shows that the country added just 20,100 net new people in the first three months of this year, the third-fewest of any quarter in comparable data back to 1972 (that’s 212 quarters). Only Q4 2014 saw a smaller increase (+15,700), while Q3 2020 (-1,200) was the only recorded quarterly decline, a time when significant border and immigration restrictions were in place due to the Covid-19 pandemic.

Such a subdued pace of growth is a striking reversal from the recent trajectory seen following the pandemic. From Q2 2022 to Q2 2024, the country added an average of 290,000 net new people per quarter, and reached a record high of 430,300 in Q3 2023. Since that peak, the pace of growth has declined for six consecutive quarters.

Driving this turnaround is the same group that drove population growth to record highs mere quarters ago: non-permanent residents, which includes foreign students, temporary foreign workers, and asylum seekers. Back in Q2 2021 there were 1.31 million non-permanent residents in Canada, equivalent 3.4% of the national population. By Q3 2024 those numbers had climbed to over 3 million and 7.4%. After a major shift in federal immigration policy last year, Canada saw a net outflow of 28,300 non-permanent residents in Q4 2024, followed by a larger 61,100 person net outflow in the first three months of this year. As a result, the stock of non-permanent residents fell to 2.96 million at the end of Q1 2025, equivalent to 7.1% of the national population.

While the population figures from the first quarter may seem dramatic, the reality is that the federal government still has a long way to go in its efforts to reduce the stock of non-permanent residents to 5% of the national population by 2027. Per the government’s own 2025-2027 Immigration Levels Plan, achieving that will require net outflows of almost 450,000 non-permanent residents in each of 2025 and 2026. Given the magnitude of the outflow in Q1 2025 (61,100), the non-permanent resident count is on pace to decline by 245,000 this calendar year, which is only about 55% of the government’s stated goal. 

To reach the target, non-permanent resident outflows will have to increase in the quarters ahead, which will likely tip the country into a state of population decline later this year. As covered in a previous article, not once in Canada’s 157-year history has there been population decline on an annual basis.

provincial perspective   

In contrast to the national figures, BC actually saw its population decline by 2,400 in Q1 2025. This marked the third and largest quarterly decrease in comparable data back to 1972, with Q3 2020 (2,200) and Q4 2010 (1,400) being the only other two instances. In line with the national trend, a net outflow of 10,900 non-permanent residents was the main cause of the province’s declining population, with additional contributors being a 1,600 person net loss to interprovincial migration (the seventh consecutive quarterly loss) and net natural decrease of 970 people (i.e., more deaths than births). Net immigration (i.e., immigrants and returning emigrants minus emigrants and those temporarily abroad) of 11,200 was not enough to offset these declines.

Despite having fewer non-permanent residents (521,500 in total) at the end of Q1, this segment still accounted for 9.1% of BC’s total population, the most of any province in Canada. BC has historically attracted more non-permanent residents than other provinces given its world-class post-secondary institutions and a higher concentration of jobs in technology, hospitality, and other services.

As the federal government continues with its policy of reducing the share of non-permanent residents in Canada, this will have a relatively larger impact on BC than other provinces. As such, the recent trend of population decline in BC is expected to continue. But just as the impacts of this policy won’t be evenly distributed across provinces, they won’t be distributed evenly within the province either. As discussed in one of our recent articles, non-permanent residents disproportionately settle in Canada’s largest urban centres. Therefore, expect these downward population pressures to be felt most acutely in Metro Vancouver.

From historic lows during the pandemic to equally historic highs in its aftermath, it's been a volatile few years for population growth and immigration policy in Canada. Looking ahead, expect that volatility to continue as the great unwinding of Canada’s population boom has just begun.