Canada’s economy lost a net 68,300 jobs in September, Statistics Canada reported Friday, a stunning miss against the 9,200 gain economists polled by Reuters had expected. The unemployment rate inched up to 6.5 percent from 6.4 percent. With the September print following a 41,700-job loss in August, Canada has effectively lost a net 41,200 jobs this year, against a 211,300-job gain over the same period a year ago.
The losses fell almost equally on full-time and part-time workers and were led by the public sector: educational services and health care and social assistance together shed 58,400 jobs. Statistics Canada pointed to fewer international students arriving as one reason for the education decline. September was the first full month under the latest round of US tariffs, but the job losses were not concentrated in US-facing industries; manufacturing, which straddles the exposure, lost a net 12,700 jobs.
The labor force continued to shrink: the participation rate fell 0.2 points to 64.8 percent, the lowest in 29 years outside the pandemic era, driven by retirements not being replaced amid slower immigration. Youth employment fell by 48,000. Permanent employees’ average hourly wages rose 2.3 percent year over year, up from 2.0 percent in August.
The report lands as the last jobs data before the Bank of Canada’s late-October decision. Markets were pricing no hike this month, with a 25-basis-point December hike creeping into expectations before the release. The Canadian dollar weakened 0.44 percent to C$1.4287 per US dollar, and two-year government bond yields fell 9.5 basis points to 2.410 percent.