Canada saw a rise of 75,000 jobs in July, marking a 0.4% increase, leading to a decrease in the unemployment rate to 6.4%, the lowest in two years according to Statistics Canada’s recent labor force survey. The job gains were primarily in full-time and part-time roles, notably in the wholesale and retail trade sector which added 21,000 new positions.
Employment growth was particularly notable among individuals aged 25 to 54, with a significant increase observed among women in this age group. While the unemployment rate for men aged 25 to 54 remained at 5.8%, it dropped to 5.2% for women within the same demographic. Ontario and British Columbia saw significant job increases in July, with Ontario leading by adding 52,000 jobs primarily in the professional, scientific, and technical services sector, while British Columbia added 18,000 new positions.
Manitoba and Nova Scotia also experienced positive job growth, with Manitoba’s employment rate increasing by 0.8%, adding 5,900 jobs, and Nova Scotia’s rate rising by the same percentage, thanks to the addition of 4,600 jobs. The country has seen a total increase of 181,000 jobs since April and 196,000 jobs compared to the previous year, building on the positive job trends observed in May and June.
Experts have lauded the job report, noting that the job numbers surpassed expectations due to robust hiring in July. The summer job market for students was highlighted as particularly strong, with unemployment for young people aged 15 to 24 dropping to its lowest level since early 2024. However, there were disparities among racialized youth, with higher unemployment rates observed for Black, Chinese, and South Asian youth compared to non-racialized and non-Indigenous youth.
While the 6.4% unemployment rate is at its lowest in two years, economists caution that it is still higher than the level expected at full employment. Positive trends in employment have been accompanied by a slowdown in average hourly wage growth, which has decreased to 2.8% year over year, the slowest rate in four years.
Looking ahead, economists warn of potential challenges, including looming tariffs that could impact the gains made in the labor market. Despite recent job growth, businesses may face uncertainties related to trade, with ongoing discussions between Canada and the U.S. on various trade issues, including the recent threat of tariffs on Canadian imports by President Donald Trump. Canada is advocating for the removal of these tariffs and seeking relief in sectors such as steel and aluminum.
The latest job numbers reflect positive momentum in the labor market, indicating a potential turning point in Canada’s economic recovery, with hopes that the trend will continue in the coming months.