Canada saw a rise in employment by 75,000 jobs in July, marking a 0.4% increase and pushing the unemployment rate down to 6.4%, its lowest level in two years. Statistics Canada’s recent labor force survey indicated that the majority of these job gains were evenly distributed between full-time and part-time positions, with the wholesale and retail trade industry contributing 21,000 new jobs.
The report highlighted a growth in employment for individuals aged 25 to 54, particularly among women in this age bracket. While the unemployment rate remained steady at 5.8% for men aged 25 to 54, it dropped to 5.2% for women in the same age group. Ontario led the provinces in job creation, adding 52,000 jobs in July, mainly in the professional, scientific, and technical services sector. British Columbia also saw a significant increase with 18,000 new jobs.
Manitoba and Nova Scotia experienced employment rate hikes of 0.8%, adding 5,900 and 4,600 jobs respectively. Overall, Canada has gained 181,000 jobs since April and 196,000 compared to the previous year. The positive trend in July follows strong job growth in May and June.
CIBC senior economist Andrew Grantham noted that the job numbers surpassed expectations, attributing the uptick to robust hiring activities in July. He also mentioned a favorable summer job market for young people, with the unemployment rate for individuals aged 15 to 24 reaching its lowest level since early 2024. However, disparities persisted among racialized youth, with varying unemployment rates for different ethnic groups.
While the overall unemployment rate of 6.4% is at a two-year low, economists cautioned that it remains slightly higher than what is considered full employment. BMO chief economist Douglas Porter emphasized the modest growth in Canada’s labor force over the past year and the slowdown in average hourly wage increases.
Looking ahead, concerns loom over potential trade disruptions, with U.S. President Donald Trump threatening to impose significant tariffs on Canadian imports. Despite these challenges, the latest job figures reflect a positive trend in the labor market, indicating resilience amid trade uncertainties. Talks on trade agreements, including the Canada-United States-Mexico Agreement, are set to resume in the coming months.