Canada saw an increase of 75,000 jobs in July, marking a 0.4% rise and pushing the unemployment rate down to 6.4%, the lowest point in two years. Statistics Canada’s recent labor force survey revealed that most of the job gains were evenly distributed between full-time and part-time positions, with the wholesale and retail trade sector alone adding 21,000 new jobs.
Employment growth was particularly notable among individuals aged 25 to 54, especially women in that age group. While the unemployment rate for men aged 25 to 54 remained steady at 5.8%, it decreased to 5.2% for women in the same category.
The province of Ontario led in job creation with an addition of 52,000 jobs, representing a 0.6% increase, primarily in the professional, scientific, and technical services industry. British Columbia followed suit with a similar increase, adding 18,000 new jobs.
Manitoba’s employment rate climbed by 0.8%, creating 5,900 new jobs, while Nova Scotia saw a similar percentage increase, resulting in 4,600 new job opportunities. According to Statistics Canada, the country has gained 181,000 jobs since April and 196,000 compared to a year ago.
The positive trend in job creation during July follows favorable employment reports from May and June. Laura Ulrich, the director of economic research at the recruitment firm Indeed, expressed optimism, stating that three consecutive months of progress could signify a turning point leading to potential stability and momentum for Canada.
The surge in job numbers surpassed expectations, with CIBC senior economist Andrew Grantham attributing it to robust hiring in July. Grantham highlighted the strengthened student summer job market and the lowest unemployment rate for young people aged 15 to 24 since early 2024.
Despite the overall unemployment rate dropping to 6.4%, Grantham noted that it remains slightly higher than ideal full employment levels. BMO chief economist Douglas Porter emphasized that although employment trends are positive, the average hourly wage growth has slowed to 2.8% year over year, the slowest rate in four years and aligning with pre-pandemic norms.
Economists suggested that the labor market has been stabilizing following a mild contraction in the first quarter, with the potential for further growth in the second quarter. However, looming trade uncertainties, including potential tariffs on Canadian imports by the U.S., could impact these gains. Canada is actively seeking to resolve trade disputes and is engaged in negotiations to address these challenges.
