Canada has hit a historic demographic milestone, and not in a good way. For the first time since 1946, the country recorded a net population decline over a full calendar year, according to preliminary estimates from Statistics Canada. The news has ripple effects for cities across the country, including Ottawa, where immigration and international students have long been key drivers of population and economic growth.
The Numbers
Between October 1, 2025 and January 1, 2026, Canada's population fell by 103,504 people, a drop of 0.2 per cent. As of the new year, Canada's total population stood at 41,472,081.
While the country did add 77,136 residents in the first half of 2025, those gains were more than wiped out by a loss of 179,572 people in the second half of the year. Statistics Canada confirmed in an email that "no one-year period has shown a decrease before 2025", making this truly a generational shift.
What's Driving the Decline
The main culprit is a dramatic fall in non-permanent residents, people living in Canada on work permits, study permits, or with refugee claims in progress. On October 1, 2024, Canada had 3,149,131 non-permanent residents. By January 1, 2026, that number had dropped to 2,676,441, a decline of nearly half a million people in just over a year.
The final quarter of 2025 alone saw a loss of 171,296 non-permanent residents. This aligns with a separate report from Immigration, Refugees and Citizenship Canada (IRCC), which found that the number of international students in Canada has plummeted by 74 per cent over the past two years, a direct result of new federal caps on study permits introduced in 2024.
What This Means for Ottawa
Ottawa has been among Canada's faster-growing cities in recent years, buoyed by federal government jobs, a thriving tech sector, and a large post-secondary population at the University of Ottawa and Carleton University. Both institutions draw thousands of international students annually, and a sustained drop in that population could affect local rental demand, small businesses, and the broader labour market.
The capital region's housing market, already strained, may see some short-term softening in rental prices as demand eases, which could offer some relief to renters. But longer term, slower population growth could dampen economic activity and reduce pressure on city planners to accelerate transit and housing development.
Federal policymakers in Ottawa (the city and the government) will be watching these numbers closely as Canada navigates competing pressures: slowing immigration, an aging domestic population, and concerns about housing affordability and social services capacity.
Looking Ahead
Statistics Canada noted that the preliminary figures could still change as data is refined. But the trend is clear: Canada's era of rapid population growth, which helped fuel real estate booms and economic expansion for decades, is hitting a significant speed bump.
Whether this represents a temporary correction or a longer structural shift will depend heavily on federal immigration policy decisions in the months ahead.
Source: blogTO, citing Statistics Canada preliminary estimates.
