Ontario’s universities are navigating one of the most consequential periods in recent memory. Financial pressures have mounted, federal reductions to international study permits have reshaped enrolment planning, and the broader economy is evolving at speed. At the same time, universities remain central to Ontario’s ability to attract talent, drive research and strengthen long-term competitiveness.
We asked Steve Orsini, President and CEO of the Council of Ontario Universities, to share his perspective on where the sector stands and what comes next. He reflects on the impact of recent policy changes, the path to financial stability, and how universities are working with government and employers to better align education and research with Ontario’s evolving economic needs.
Ontario’s universities have been under financial strain for several years with international student fees increasingly helping to fill the gap. In a major effort to scale back immigration numbers, the federal government capped and then further reduced international study permits. How has that affected Ontario’s ability to attract talent?
Ontario’s universities have long been a magnet for global talent, but federal across-the-board reductions in international study permits have had big impacts. It has limited Ontario’s ability to attract global talent, while weakening university research and innovation capacity and Ontario’s competitiveness. In addition, over the past two years, Ontario universities have lost $1 billion in revenue, which is expected to increase by another $1.1 billion next year.
International students play a vital role within the social and economic fabric of the province and our country. They contribute research capacity, entrepreneurial activity and long-term labour market integration. Many remain in Ontario after graduation, helping to fill critical shortages in health care, STEM, advanced manufacturing and business services.
The abrupt across-the-board reduction in permits starting 2024 created financial instability across institutions, which affected universities’ ability to maintain program breadth, student supports and research intensity — all core to Ontario’s global reputation.
From a talent perspective, unpredictability is the greatest risk. Competing jurisdictions — such as U.K., and Australia — are actively courting international students as future skilled immigrants. If Ontario is perceived as unstable or unwelcoming, the impact extends beyond tuition revenue to long-term productivity and innovation capacity.
Recent federal Budget measures including funding to attract top talent from around the world and fast-tracking PhDs approvals are an important turning point. The federal government’s recent changes to the Express Entry system build on these measures. By prioritizing permanent residence selection in health care, STEM, infrastructure and advanced technology occupations, Canada is strengthening the link between immigration and economic needs.
What do you want to see from the provincial and federal governments to bring universities back to a financially sustainable position and to improve Ontario’s position as a destination for top talent?
In the lead up to the 2026 Ontario budget, Ontario’s universities were looking for greater investment in the sector to provide sustainable and predictable funding after several years of growing financial pressures — over the past three years, Ontario universities made nearly $1.28 billion in cuts and deferrals, including 2,500 job losses.
That is why the provincial government’s announcement last week to provide $6.4 billion in funding for colleges and universities over four years is so significant. It represents a landmark investment that helps stabilize the sector and reinforces the province’s recognition that universities are foundational to productivity, competitiveness and economic growth. This commitment will help protect program quality, sustain student supports, and strengthen high-demand fields such as health care, STEM, AI and advanced manufacturing.
However, long-term sustainability also requires universities to continue driving structural efficiencies and deeper industry collaboration. The sector is expanding shared services, joint procurement, digital transformation and the responsible deployment of AI to streamline administrative operations and reduce back-office costs. These efforts ensure that public and student dollars are used prudently while preserving academic quality and research intensity.
With stable, predictable funding and deeper industry partnerships, Ontario can reinforce its global competitiveness, accelerate productivity growth, and solidify its position as a premier destination for world-class talent.
If we want to grow our postsecondary system in a way that sustains high quality and global standards, what should the international student intake look like? What’s your advice to government to maximize benefit for the economy.
Recruiting top talent aligned with workforce needs must be the central objective of international student policy. International enrolment should be sustainable, predictable and matched to institutional capacity. Ontario universities acted responsibly in recruiting and supporting international students, with a modest growth rate and representing less than 19 per cent of total enrolment. To ensure high standards, all Ontario universities have signed on to COU’s leading practices in supporting international students. While Canada leads the OECD in overall postsecondary credentials, we lag many peer jurisdictions in advanced degrees — a gap that is correlated with lower levels of industrial productivity and R&D intensity.
International student permit allocations should therefore prioritize advanced degrees in fields that drive innovation and economic growth and align with Canada’s labour market needs. The federal government’s recent changes to Express Entry — selecting permanent residents in areas such as health care, STEM, infrastructure and advanced technology — reinforce this approach.
My advice to the federal government is threefold: continue to streamline processes and accelerate approvals for advanced degrees in high-demand programs; enhance incentives to attract top researchers from around the world to locate here; and continue to expand clear, predictable pathways from study to work to permanent residency through priority immigration streams such as Express Entry.
Beyond federal and provincial policy, the economy continues to evolve through tariffs, the introduction of AI and the emergence of growth sectors like nuclear. How is the university sector working to adapt to a rapidly changing economic environment?
Ontario’s universities are actively transforming to respond to structural economic change. In AI, institutions are embedding AI literacy across disciplines while strengthening advanced research through deeper collaboration with industry and leading research institutes. Universities are also modernizing assessment models, curriculum design and program offerings to ensure graduates are adaptable, technologically fluent and resilient in a rapidly evolving labour market.
In response to tariffs and global supply chain shifts, universities are accelerating partnerships in advanced manufacturing, critical minerals and clean technologies to strengthen domestic capacity and productivity growth. COU is working in partnership with the province on key sector initiatives, including life sciences, critical minerals and battery technology, to align research strengths with industrial strategy.
In emerging sectors such as nuclear — including small modular reactors — universities are expanding engineering, nuclear science and energy policy programs while advancing research commercialization and workforce development aligned with Ontario’s long-term energy strategy.
The sector recognizes that productivity and competitiveness are the defining economic challenges of our time. Universities are accelerating their transformation to better support student success, drive research and innovation, and enable industrial modernization across the province.
Going forward, how is the university sector planning to collaborate with employers to align education with workforce needs?
Collaboration with employers has intensified significantly, especially in light of economic threats from the United States. Universities are expanding co-op, work-integrated learning and internship programs to provide students with applied experience.
Universities have increased STEM enrolment by 76% and health programs by 44% since 2010. They have cut or closed 2,700 courses and programs over the past three years to help adapt to the ever-changing needs of students and the economy. In addition, Continuing Education divisions — serving over 120,000 learners annually across Ontario — are delivering agile, industry-responsive programming.
We are also working closely with industry associations, chambers of commerce and community organizations to ensure curriculum reflects evolving skill demands, particularly in digital, health and advanced manufacturing fields.
Importantly, collaboration is not limited to undergraduate programming. Graduate research partnerships support commercialization, productivity improvements and applied innovation within firms.
Going forward, we will deepen our partnerships with government and industry to better align enrolment planning with labour market need. The objective is clear: a postsecondary system that supports student success while directly strengthening Ontario’s talent pipeline, productivity and long-term economic growth.
