In July, the Canadian economy experienced a decline of over 40,000 jobs, leading to a drop in the employment rate to its lowest level in eight months, according to Statistics Canada. Despite this, the unemployment rate held steady at 6.9%, marking a multi-year high.
The loss of 40,800 jobs in July reversed the previous month’s gain of 83,000 jobs, resulting in an employment rate of 60.7%. This decrease primarily affected permanent employees, as highlighted by Statistics Canada.
Economists had anticipated an increase of 13,500 jobs, with the unemployment rate expected to rise to seven percent. BMO’s chief economist, Douglas Porter, characterized the latest data as signaling a weak start to the third quarter, reflecting a soft economy with lingering trade uncertainties.
The decline in employment was most pronounced among individuals aged 15 to 24, with their employment rate falling to 53.6%, the lowest since November 1998 excluding pandemic-related impacts. Youth unemployment reached 14.6%, the highest since September 2010, with high school students facing challenges in securing employment as they return to school.
Notable job losses were observed in industries such as information, culture, and recreation (down 29,000 jobs), construction (down 22,000 jobs), and business support services (down 19,000 jobs). On the other hand, transportation and warehousing saw an increase of 26,000 jobs.
Overall, the latest employment figures point to a concerning trend in the Canadian labor market, with various sectors experiencing significant fluctuations in job numbers.