Based on coverage from StatsCan.
Canada's labour market took a bit of a tumble in August 2025, with employment dropping by 66,000 jobs. This marks the second consecutive month of decline, following a 41,000-job dip in July. The unemployment rate nudged up to 7.1%, the highest since May 2016, if you conveniently forget the pandemic years when everything was upside down.
The decline was mainly in part-time jobs, which fell by 60,000, while full-time employment remained relatively stable. This shift hit core-aged men and women (those between 25 and 54) the hardest, with employment rates for these groups reaching their lowest since 2017 and 2018, respectively. Meanwhile, youth and those over 55 saw little change, perhaps because they were already bracing themselves for the storm.
Industries like professional, scientific, and technical services, transportation and warehousing, and manufacturing bore the brunt of the job losses. Yet, construction bucked the trend with a 17,000-job increase, offering a glimmer of hope in an otherwise gloomy landscape.
Geographically, Ontario, British Columbia, and Alberta saw the largest employment declines. Ontario's job market, in particular, has been struggling with the added pressure of tariffs on motor vehicle and parts exports. Windsor, Oshawa, and Toronto are feeling the pinch, with unemployment rates climbing in these areas.
Interestingly, the number of self-employed workers also fell by 43,000, continuing a downward trend that began earlier in the year. This suggests that the gig economy, often seen as a safety net, might not be as resilient as some had hoped.
Despite the job losses, average hourly wages increased by 3.2% over the past year, reaching $36.31. However, this wage growth might not be enough to offset the rising unemployment and underemployment rates. In August, nearly 9% of workers expressed a desire to work more hours, primarily to cover expenses, while about 16% of multiple jobholders reported juggling jobs to meet essential needs.
The summer job market was particularly tough for students, with an unemployment rate of 16.9% for those planning to return to school in the fall. This is the highest summer unemployment rate for students since 2009, excluding the pandemic year of 2020.
In the broader context, these figures highlight a cooling labour market, with underemployment and multiple jobholding painting a complex picture of economic challenges. While some workers are eager to clock more hours, others are looking to cut back due to stress or family responsibilities.
As we look ahead, the labour market's trajectory remains uncertain. With the next Labour Force Survey set for release in October, Canadians will be watching closely to see if these trends continue or if a turnaround is on the horizon. For now, it's a waiting game, with many hoping for a more stable and prosperous job market in the months to come.
