Canada added about 189,000 people over the 12 months through July 1, bringing the population to 41.8 million. That 0.5% climb is the slowest annual pace since 1915-16, according to Statistics Canada.
This downshift comes after a post-pandemic surge powered by international students and temporary foreign workers. Amid the surge, former prime minister Justin Trudeau's government came under sharp fire, leading to immigration policy changes intended to cut admissions.
According to BMO senior economist Robert Kavcic, the new report upgraded prior estimates that had pointed to outright drops, which softens the optics of the headline. "But the reality is that we're seeing 0.5% population growth, which is still a major shift from the last couple years," Kavcic said.
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The number of non-permanent residents dropped by 154,614, putting the temporary resident tally at 2.8 million. Canada also welcomed fewer new permanent immigrants for the fourth year in a row, in line with lower annual targets for permanent resident admissions. With fewer international students, the population has resumed aging, including a decline in people in their 20s.
Among provinces, Alberta led with a 1.5% growth rate.
Cooler population growth is one reason overall activity has softened, while tariffs are also hitting certain sectors and adding uncertainty. Housing shows the impact most clearly, with both sales and prices stalling as immigration ebbs.
Kavcic said the post-Covid stretch proved the economy couldn't handle population growth above 3%, calling today's slower pace a "necessary adjustment." Yes, the earlier surge lifted GDP, but Canada struggled with productivity and to attract investment. He added the country is now trying to flip that script, pointing to last week's first investment summit and new federal moves aimed at spurring capital spending. "So if it plays out that way, that's a pretty sharp reversal from what we've seen over the last decade in Canada, which was a lack of capital investment and really, really significant population growth," he said.
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