St. Clair College faces $6.5M budget deficit, but U.S. trade war could spark new demand
But the college says the U.S. trade war could trigger new domestic demand and investments in training
St. Clair College has entered the 2025-26 fiscal year with a budget deficit of $6.5 million, after a year that saw enrolment impacted by steep cuts to study permits issued to international students.
The board of governors approved the budget in late March.
College President Michael Silvaggi told CBC on Monday the deficit was unfortunate but not a surprise.
"Certainly, there has been a change in the landscape of post-secondary education, and not just [in] Ontario, but all through Canada," Silvaggi said.
"St. Clair College is not immune to all the change that has happened."
The federal government slashed international study permits by more than a third at the start of 2024 amid concerns that the number of international students in the country was contributing to a shortage of housing and driving up rents and purchase prices.
Reserve fund to cover deficit
It cut permits by another 10 per cent for the 2025 school year.
St. Clair responded in February by suspending 18 of its programs, including many that had been popular with international students, though it still anticipates posting a surplus for the 2024-25 school year, Silvaggi said.
Funding to cover the 2025-26 deficit will come from the institution's sustainability reserve fund, whose purpose is to offset deficits when necessary.
"St. Clair College has always taken a very conservative approach with respect to our finances," Silvaggi said,
"So we have some comfort there knowing that we have some money set aside."
The college is mandated to balance its budget, but it opted not to cut spending enough to do so this year because of the uncertainty created by the U.S. trade war with Canada and the need to reshape the Canadian economy.
"You don't want to cut too deep because there's still all kinds of unknowns," he said.
"And what kind of position are you going to be in if a policy change resurrects something and then all of a sudden you're not able to respond accordingly and so forth … Unfortunately, you're not always able to right the ship on a dime."
Silvaggi does not expect the federal government to loosen its restrictions on international study permits any time soon, he said.
And even if it did, he said, Canada would have work to do to rebuild its reputation as a destination for those students.
College Ontario, the advocacy organization for the province's colleges, had previously told CBC it was concerned about the federal government's changes to immigration and the impact on students and local economies.
But the country's efforts to refocus its economy away from the United States may create new demand from domestic students and attract new investment in training, Silvaggi said.
"In terms of economic development and so forth, colleges have always played a role in training, in retraining, in blazing new territory," he said.
"So certainly that is a consideration. Because we need to be ready when called upon."
The University of Windsor announced in April that it had trimmed its budget deficit to $4 million through a series of cost-cutting measures.
Those included eliminating vacant positions, laying off some staff, reducing part-time teaching contracts and implementing a hiring freeze, Vice President of Finance and Operations Gillian Heisz said at the time.