Canada’s labor market contracted for the second consecutive month in August, as employment declined by 66,000, or 0.3 percent, with most of the losses in part-time positions. The national employment rate slipped 0.2 percentage points to 60.5 percent while the unemployment rate rose to 7.1 percent, the highest since May 2016 outside the pandemic years.
Core-aged workers between 25 and 54 years old were hardest hit. Employment among men fell by 58,000, or 0.8 percent, while core-aged women saw losses of 35,000, or 0.5 percent. Both groups posted the weakest employment rates in several years. Youth employment and jobs among workers aged 55 and over held steady.
The August decline was broad-based, with professional, scientific and technical services losing 26,000 jobs, transportation and warehousing down 23,000, and manufacturing shedding 19,000. Construction was one of the few bright spots, gaining 17,000 workers, partially offsetting declines earlier in the summer.
Regionally, employment contracted most sharply in Ontario, which lost 26,000 jobs, followed by British Columbia with 16,000 and Alberta with 14,000. Across the provinces, declines were concentrated in part-time and self-employment, the latter falling by 43,000 amid a downward trend that has erased gains from late 2024 and early 2025.
Despite slowing job creation, wage growth remained solid. Average hourly earnings rose 3.2 percent from a year earlier to $36.31, maintaining a pace of increase comparable to July. Total hours worked were little changed on the month and up 0.9 percent year over year.
The data add to signs of a softening labor market. The number of unemployed people stood at 1.6 million in August, while the proportion of jobless individuals finding work fell to 15.2 percent, well below pre-pandemic averages.
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