Canada saw a rise of 75,000 new jobs in July, marking a 0.4% increase and bringing the unemployment rate down to 6.4%, its lowest point in two years. According to the recent report by Statistics Canada, the majority of these job gains were evenly distributed between full-time and part-time positions, with the wholesale and retail trade sector contributing 21,000 new jobs.
The employment surge was particularly notable among individuals aged 25 to 54, especially women in that age group. While the unemployment rate remained stable at 5.8% for men aged 25 to 54, it dropped to 5.2% for women in the same category.
Ontario led the provinces in job creation in July, adding 52,000 jobs, mainly in the professional, scientific, and technical services industry. British Columbia also experienced a significant increase, with 18,000 new jobs added. Manitoba and Nova Scotia both reported a 0.8% growth in employment, resulting in 5,900 and 4,600 new jobs, respectively.
Overall, Canada has seen a total increase of 181,000 jobs since April and 196,000 compared to the previous year. This positive trend in July follows similar improvements in employment in May and June, indicating a promising trajectory for the country’s job market.
Economists were pleasantly surprised by the job numbers, with CIBC senior economist Andrew Grantham noting that the hiring pace exceeded expectations. He highlighted the strength of the student summer job market and the lowest unemployment rate for young people aged 15 to 24 since early 2024. However, disparities were observed among racialized youth, with higher unemployment rates for Black, Chinese, and South Asian youth compared to their non-racialized counterparts.
While the overall unemployment rate has reached its lowest level in two years, economists caution that it remains slightly higher than what is considered full employment. Despite the positive job trends, average hourly wage growth has slowed to 2.8% year over year, the slowest rate in four years.
Looking ahead, economists warn of potential challenges due to looming tariffs, particularly with U.S. President Donald Trump’s proposed 50% tariffs on Canadian imports. Discussions on trade agreements and tariffs are ongoing, with potential implications for Canada’s economic landscape in the coming months.