International students are vital to Canada’s economic recovery after Covid-19
Support for international student mobility is crucial for our knowledge networks and economic growth.
Stein Monteiro, Ryerson University
May 15, 2020
The transition from student to worker is a difficult time for any new graduate. The economic downturn brought on by the COVID-19 pandemic will make this year’s transition even more painful. For a portion of the 80,000 international students in Canada that will graduate this year (external link) , their economic position is becoming increasingly precarious.
The COVID-19 pandemic was a shock to the international higher education across the world, affecting the future of student mobility, high skilled immigration and our knowledge networks deeply. There are more than 5.3 million international students worldwide (external link) . These students are integral to the linkages in our global knowledge systems, and in countries like Canada, UK, US and Australia will become an important source of high skilled immigration.
While some higher education institutions across the world have taken steps to address the needs of their international students, staff and faculty, the varying distribution of financial resources (external link) across the world means that some institutions will close down or not be able to support the needs of their students. In Canada, international students are a major source of revenue for the postsecondary education sector and a source of high skilled immigration for the country.
COVID-19 has made a lasting impact on the Canadian economy and the postsecondary education sector. Although universities and colleges were resilient and quickly responded by continuing operations in an online teaching format, not every sector of the economy was able to make the shift. Before the Canadian government implemented strict advisories to implement self-isolation across the country, Statistics Canada (external link) reported an unemployment rate of 5.6%, with the Conference Board of Canada (external link) reporting an additional 2.8 million people that will be put out of a job by the end of April.
One of the major issues that affect international students’ wellbeing is financial
The Canadian economy as a whole has been affected drastically for the next two years. Initially, the Canadian Outlook (external link) report published by the Conference Board of Canada forecasted real GDP growth rates of 2.5% and 2.7% for 2020 and 2021. These growth forecasts have been drastically reduced to a dismal 0.7% for 2020 and a smaller 2.3% for 2021 since the implementation of self-isolation measures across the country.
For international students the economic effects of COVID-19 are compounded. The fact that international students already face a relative disadvantage due to language barriers, fewer family and friend networks, and precarity in their legal status, this group of students are particularly at risk of mental health problems from self-isolation measures.
Nevertheless, one of the major issues that affect international students’ wellbeing is financial. Many of these students will apply for a Post-Graduation Work Permit (PGWP) in the hopes of building enough Canadian work experience to either apply for Permanent Residency status or go back to their home countries with a smaller debt burden. Instead, they will face unemployment for at least eight months before the Canadian economy can recover from this pandemic.
An international student who graduates from a four-year Bachelor’s degree program receives the maximum of a three-year work permit. However, most international students graduate from shorter Master’s (18%) and Short-cycle Tertiary programs (41%) (external link) of one-two years that give them at most a two-year work permit.
Immigration, Refugees and Citizenship Canada must be willing to make extensions to the work permits for all international students so that they have sufficient time to find a job and make the required 12 months of work experience to become eligible to apply through the Federal Skilled Worker Program or Canadian Experience Class.
International students spend $23,600 - $27,600 per year (external link) to attend a Canadian postsecondary institution. Some of these students carry a large debt burden in their home countries where interest rates are usually higher than in Canada. For instance, students from India will pay interest rates of 10% on an education loan. Most will take 10-15 years to pay off their debts. For this reason, working in Canada means they can pay off their debts faster and also gain valuable experience that they can take back to their home countries for higher paying jobs.
For the Canadian government, international students are a lucrative source of spending and high skilled immigration
On the other hand, some students will carry enough post-graduation work experience in Canada to apply for either the Canadian Experience Program, Federal Skilled Worker Program, Provincial Nominee Program or Quebec Immigration Program. The (PDF file) Canadian Bureau of International Education (external link) conducted a survey that found 51% of international students intended to apply for permanent residency, although a larger 61% planned to work in Canada. This means that some international students intend to work in Canada without applying for permanent residency, although these would be in a minority.
About 20-27% (external link) of international students will apply successfully through one of these programs to become a Permanent Resident. For the Canadian government, international students are a lucrative source of spending and high skilled immigration. A 2017 study estimates that international students and their visitors contribute about $12.8 billion to Canada’s GDP and support 168,860 jobs (external link) . Those international students that transition to permanent residency contribute as high skilled immigrants to the economy through (PDF file) entrepreneurialism, innovation, creating global networks and population growth in small and medium sized cities (external link) .
Usually, online courses are not considered for time under the PGWP. The Canadian government has taken account of the shift to an online format due to COVID-19 so that international students’ eligibility for a work permit will not be affected. Although the government has considered the immediate impact of the pandemic, it has not planned for the impending economic downturn. A Special Situations (external link) request gives U.S. Citizenship and Immigration Services some discretion, on a case-by-case basis, to assess immigration requests in the face of extreme situations. Unfortunately, no such system currently exists for international students in Canada that face exceptional circumstances.
If the government does not take action to extend post-graduation work permits there will be fewer students transitioning into permanent residency status and this will have serious long-term effects on the recovery from the pandemic, innovativeness and growth of the Canadian economy. Moreover, it will also discourage future student mobility (external link) into Canada which can have adverse effects on the financial sustainability of our postsecondary education sector.