Closure of Algonquin College’s campus in Perth, Ont. has negative economic implications: Mayor

The Algonquin College campus in Perth, Ont. (Kimberley Johnson/CTV News Ottawa)

The mayor of Perth, Ont. is voicing her concern about Algonquin College’s plans to close its campus in the rural area, citing negative implications on the economy and the community.

The planned closure of the campus in Perth will result in job losses, and fewer opportunities for the community’s residents, Mayor Judy Brown told Newstalk 580 CFRA's CFRA Live with Andrew Pinsent Sunday.

“I know how many teachers are losing their jobs and how many students won't be putting money into the economy,” Brown said.

“The thing that touches my heart the most, is that this is a local college, and I've talked to young women who have gone back to school for whatever, you know, maybe their marriage is broken up… They’ve got little kids (and they) realize they need more training, and it's feasible because the college is in Perth and their mom can look after the kids.”

The economic loss translates into less revenue to address the town’s aging infrastructure, Brown explains.

“For example, this year we're late to do Craig Street, which turns into Highway 43. Cost is $5.3 million,” Brown said. “We only have 3,000 taxpayers.”

The loss in revenue will also affect the city’s plans to revamp its arena and pool, Brown adds.

The college plans to close its campus in Perth next year, as it deals with a multi-million-dollar deficit due to the new federal cap on international students and provincial funding shortfalls, Algonquin College president, Claude Brulé, said in a letter to employees and students Thursday.

Brulé said in the letter following a review of operations by the college's executive and leadership teams, it has "become clear" that Algonquin College is projecting a $32 million loss in revenue for the 2024-25 school year.

"Without mitigation measures to change course – on a cash flow basis – the college anticipates a deficit of $60 million for 2025-26, increasing to $96 million for 2026-27," said Brulé.

In January 2024, the federal government announced a temporary two-year cap on international student levels by 35 per cent this year. Last September, the government announced new international student study permits will be reduced by another 10 per cent to 437,000 permits with the target continuing into 2026. The federal government also announced changes this fall to post-graduate work permits with the permits restricted to areas that have labour shortages in Canada.

Algonquin College was projecting international student enrolment to be short nearly 2,400 incoming students this school year.

'Closure part of a broader trend': Economist

The closure of the Perth campus is part of a broader trend Canadian post-secondary institutions have been seeing, Moshe Lander, professor of economics from Concordia University, told CTV News Ottawa Sunday.

“Many are suffering immense financial strain and the pursuit of foreign students, paying two–three times the rate charged to Canadian citizens, is a symptom of the problem,” Lander said.

“The biggest expenses for post-secondary institutions have always been facilities and faculty (in either order). Faculty live longer than average and tenure affords them the opportunity to work well past a traditional retirement age meaning their cost, coupled with generous pensions, is growing much faster than the pace of inflation.

“Canadian students travel abroad for their education more than ever before and attracting students to Canada is harder than ever as local universities must compete globally in a way that they never had to before. Ensuring that facilities are state-of-the-art, maintained at the highest level of quality and situated in idyllic locales and/or large metropolitan areas adds further to university budgets.”

Lander says though the loss of the Perth campus is “unfortunate,” it was “living on borrowed time.” He recommends that leaders put in place “contingencies for how to cover the economic loss and for what to do with the geographic footprint that the campus closure will leave behind.”

Higher taxes and tuition fees, and freezing faculty pay negatively affect research and the quality of education, Lander notes.

"Freezing faculty pay leads to lower quality instruction and poorer research output which becomes a vicious circle of declining standards.  Stopping construction/maintenance of facilities is not a costless exercise as current campus facilities still require funding to remain operational but can also send a negative signal to student/faculty recruitment/retention," Lander said. "Current government caps on foreign students limits the ability to rely on foreign tuition to cover the gap and the expected change of government within the next nine months is unlikely to produce a change in this policy.  That leaves rationalising campuses."

Brulé said a recommendation will be presented to the Algonquin Board of Governors in February to close the Perth Campus by the end of August 2026.

The Perth Campus is one of three campuses operated by Algonquin College. It offers programs including Business-Agriculture, practical nursing and "Heritage Trades" including a "Bachelor of Applied Science (Building Conservation)" and "Heritage Carpentry and Joinery."

The Perth Campus has capacity for 350 students, and Brulé says there are 132 full-time students enrolled this school year. The campus first opened in 1970.

Algonquin College also has campuses in Ottawa and Pembroke.

With files from CTV News Ottawa’s Josh Pringle