VIDEO Canada’s immigration strategy has lost its edge, so rebuilding trust in the system is needed as Ottawa looks to reduce its reliance on the United States and pursue new economic goals, according to a new Royal Bank of Canada report.
The report said factors such as population shocks — from the huge increase in immigration between 2022 and 2024 to a rare decline in population numbers in 2025 — frequent rule changes, a weakened points system and a diminished focus on skills and experience have created an unstable environment, which is not good for the economy.
“The report adds to the urgency of getting our strategy in order and making sure that we are able to attract the talent that we need to pursue the economic plans that Canada has for itself right now and keep our economy strong,” said Jackie Pichette, director of skills policy at RBC Thought Leadership, who authored the report.
The federal government is trying to speed up and fund key projects linked to sectors such as energy, mining and transportation as it looks to make the economy more independent amidst a trade war with the U.S., but a stable immigration system is also needed to attract the talent to support these industries.
Canada’s immigration system has historically been reliable, but it’s been less so in recent years as the country added three million newcomers between 2022 and 2024, which is roughly the equivalent of a decade’s worth of immigration, the report said.
The population growth rate was later pulled back through temporary resident caps and lower immigration targets, but the report said these led to shockwaves as well. For example, more than 25 rule changes impacted international students from 2024 to 2026, resulting in more than 20,000 job losses in the post-secondary sector.
The disarray comes at a time when more than 25,000 Canadians retiring every month and with the number of deaths outpacing births, the report said.
“Without immigration, the country’s population would shrink to half its size by the turn of the century,” it said.
The report said the Express Entry system, one of the more popular ways of immigrating to Canada, is not working as intended due to changes introduced in 2022.
The system provides prospective immigrants with points for their education levels, work experience, English and French language proficiency, age and other factors. The higher applicants score, the higher the chance they have of becoming permanent residents, which eventually leads to citizenship.
The system is designed in a way to attract young, skilled people who are more likely to earn more money and contribute positively to the Canadian economy.
But the government in 2022 introduced a category-based system that allows it to select certain immigrants from in-demand occupations or groups, including pilots, doctors and people who speak French, regardless of the points they accumulate.
That leaves fewer spots for general applicants who may have more points, which helps undermine the Express Entry program, the report said.
The category-based system has also changed multiple times since 2022, which the report said illustrates how quickly skill demands change and the futility of designing permanent immigration around them at a national level.
Instead, RBC wants Ottawa to prioritize applicants who score the highest points instead of picking and choosing them through categories and let provincial immigration systems handle the latter since they are more likely to understand their specific occupational needs.
“It doesn’t make that much sense to recruit for those specific professions at a national level because you have no direction over where those people end up in Canada,” Pichette said. “Are they actually going to the places where the shortages are most acute?”
Instead, the provinces should create the categories based on their local talent shortages and ensure they have programs to quickly provide them with credentials so they can work in those professions.
Stephen Green, an immigration lawyer at Toronto-based law firm Green and Spiegel LLP, said the government should focus on a human capital model that looks at the various characteristics of an applicant who provides the highest economic success.
“This would provide a proper balance within our immigration system,” he said.
The category-based system has not worked to boost the economy, Green said, pointing to the government’s decision to keep a separate category for Francophones that skewed the economic selection system.
“Francophone applicants are provided with significantly lower thresholds to enter our immigration system and their skills are looked at less than language,” he said. “We must have a proper balanced program looking at those who will become the most economically successful in our Express Entry system.”
RBC’s report said the government correctly took steps to reduce Canada’s population growth in 2024, but by capping the number of temporary residents, primarily students, it may have overcorrected since many of them become high-skilled workers who apply to be permanent residents.
“We are now looking at a situation where that pipeline of talent who have done so well historically, when switching from temporary to permanent residency,” Pichette said. “We are not admitting as many international students in those high-quality programs who could be making that transition.
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