Canada saw a rise of 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 disclosed that the majority of these job gains were 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 bracket. 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 group. Ontario led the provinces in job creation, adding 52,000 jobs in July, mainly in the professional, scientific, and technical services industry. British Columbia also experienced a notable increase with 18,000 new jobs.
Manitoba’s employment rate rose by 0.8%, securing 5,900 new jobs, while Nova Scotia saw a similar increase of 0.8%, adding 4,600 jobs. Statistics Canada reported that the country has gained 181,000 jobs since April and 196,000 from the previous year. This positive employment trend in July follows promising job reports from May and June.
CIBC senior economist Andrew Grantham praised the job numbers, which exceeded expectations, attributing the success to robust hiring in July. He highlighted the stronger summer job market for young people, with the unemployment rate for individuals aged 15 to 24 hitting its lowest level since early 2024. However, the unemployment rates varied among racialized youth, with Black youth facing a 22.6% unemployment rate, Chinese youth at 15.4%, and South Asian youth at 13.9%, compared to 11.6% for non-racialized and non-Indigenous youth.
Despite the overall unemployment rate dropping to 6.4%, Grantham noted that it is still higher than the level expected at full employment. BMO chief economist Douglas Porter emphasized that while employment trends are positive, average hourly wage increases have slowed down to 2.8% year over year, the slowest in four years and reflecting pre-pandemic patterns.
Looking ahead, concerns loom over potential trade disruptions, with U.S. President Donald Trump threatening 50% tariffs on various Canadian imports starting August 19. Canada is advocating for tariff reductions and seeking relief from sectoral tariffs, including those on steel and aluminum. Negotiations under the Canada-United States-Mexico Agreement are set to resume in the fall, amidst ongoing trade uncertainties.