Sector cuts, full-time losses, and rising unemployment push labour market into slowdown
Canada shed 33,000 jobs in March—the largest monthly loss since January 2022—according to Statistics Canada.
The decline was driven by a loss of 62,000 full-time positions, with private sector employment dropping by 48,000 (-0.3 percent). This marks a reversal after gains of 97,000 in the sector from November through January.
Public sector and self-employment levels remained stable in March, each posting year-over-year gains of 2.1 percent and 3.0 percent respectively.
BNN Bloomberg reported that “the economy shed 33,000 jobs in March, while the unemployment rate ticked up to 6.7 percent.”
The article attributed some of the weakness to the impact of US tariffs, quoting RSM Canada economist Tu Nguyen who said “We saw a lot of layoffs happening in trade in March and we expect April to see even more layoffs and a rise in the unemployment rate.”
Nguyen also warned, “the auto sector is so integrated in North America that once you hit one country, you’re going to hit everybody.”
Wholesale and retail trade lost 29,000 jobs in March, erasing much of February’s gain (+51,000). Employment in information, culture and recreation declined by 20,000 (-2.4 percent), and agriculture employment fell by 9,300 (-3.9 percent).
According to The Globe and Mail, “job declines were widespread across industries, and concentrated in full-time positions and private-sector employment.”
CIBC senior economist Andrew Grantham said, “the wheels may be starting to come off the Canadian labour market.”
Ontario lost 28,000 jobs, led by declines in information, culture and recreation (-23,000; -6.2 percent) and business support services (-13,000; -4.2 percent). The unemployment rate in the province rose to 7.5 percent.
In Alberta, job losses reached 15,000, mostly in manufacturing (-11,000; -7.5 percent) and wholesale/retail trade (-9,200; -2.5 percent).
Alberta’s unemployment rate rose to 7.1 percent. Saskatchewan, meanwhile, added 6,600 jobs (+1.1 percent), with a jobless rate falling to 4.9 percent—the lowest among provinces.
Following the weak labour data, The Globe and Mail reported that “financial markets upped their bets on another interest rate cut” at the Bank of Canada’s next meeting on April 16. Traders put the odds at 65 percent for a cut to 2.5 percent.
RBC senior economist Claire Fan, in a statement quoted by BNN Bloomberg, noted that while the March report was “slightly softer” than expected, ongoing weakness and tariff effects “would spill over to negatively impact Canada.”
Canada’s unemployment rate rose 0.1 percentage points to 6.7 percent in March. Year-over-year, unemployment increased by 167,000 (+12.4 percent), with long-term unemployment making up 23.7 percent of the total—up from 18.3 percent in March 2024.
Among those unemployed in February, only 14.7 percent became employed in March, down from 18.6 percent a year earlier. A growing share (41.5 percent) of unemployed individuals had not worked in the past year or had never worked, up from 35.4 percent in March 2024.
Men aged 55 and older lost 21,000 jobs (-0.9 percent) in March, bringing the cumulative loss for this group to 47,000 since January. The employment rate for this group declined to 38.8 percent.
Youth employment remained steady, though year-over-year employment rates were down 1.3 percentage points for young women and 1.0 percentage points for young men.
The overall employment rate fell to 60.9 percent, while total hours worked rose 0.4 percent after a February decline. Year-over-year, total hours were up 1.2 percent. Average hourly wages grew 3.6 percent (+$1.24 to $36.05), slightly down from 3.8 percent in February.
Employment rates in Yukon (71.8 percent) and the Northwest Territories (68.1 percent) remained above the national average. Nunavut reported a 53.6 percent employment rate, with the Inuit population’s rate at 45.0 percent.
There were 2.7 million self-employed workers in March, up 81,000 (+3.0 percent) from a year earlier.
However, only 43.3 percent had supplementary health care coverage, 36.4 percent had dental, and 25.3 percent had disability insurance.
Incorporated self-employed workers with employees were more likely to have benefits than unincorporated workers without employees.
Statistics Canada noted that self-employed workers still comprise a lower proportion (13.1 percent) of the total workforce compared to the pre-pandemic average (14.9 percent).
