Mixed Momentum in Canadian Jobs
Canada's Unemployment Rate Slips to 6.5% in June as Job Market Shows Mixed Momentum
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Key Points
1
June marked a second consecutive monthly decline in unemployment to 6.5%, with Canada adding a net 18,200 jobs, following May's much larger 87,800-job gain.
2
Youth employment rose by 33,000 in June (ages 15–24), while employment among those 55 and older fell by 47,000; the youth unemployment rate dropped to 12.7%.
3
The June job mix showed accommodation and food services adding 15,000 jobs, while manufacturing lost 17,000 and agriculture declined by 7,600.
4
Economists noted June's mix included gains in health care, education, and professional services offsetting declines in manufacturing and natural resources, indicating some resilience in the labor market.
5
A 2024 snapshot showed unemployment at 6.4% as the labor force grew by 185,000 with 156,000 jobs created, highlighting a structural imbalance with newcomers; wages rose 5.2% year over year, and the Bank of Canada cut the policy rate to 4.75% in June.
Canada's unemployment rate slipped to 6.5% in June, marking the second straight monthly decline, according to Statistics Canada. The economy added a net 18,200 jobs — nearly double the 10,000 analysts expected — building on May's massive 87,800-job surge.
The employment rate ticked up by 0.1 percentage points to 60%, Yahoo Finance reported. The result signals a labor market that keeps grinding forward, even as the gains are uneven across age groups and industries.
Youth Jobs Surge While Older Workers Fall Behind
The age divide in June was stark. Workers aged 15 to 24 gained 33,000 jobs, pushing the youth unemployment rate down to 12.7%, according to Financial Post. That is a meaningful improvement for a group that often struggles most in uncertain economies.
Older workers told a different story. Employment among those 55 and older dropped by 47,000 in June, according to Chatham Daily News. That decline offset much of the youth gain and shows the recovery is not reaching everyone equally.
Restaurants Hiring as Factories Cut Jobs
June's job gains were concentrated in a few sectors. Accommodation and food services added 15,000 jobs. Health care, education, and professional services also posted gains, Financial Post reported. These are mostly service-sector roles, not high-paying industrial work.
On the losing side, manufacturing shed 17,000 jobs and agriculture fell by 7,600. Natural resources also declined. The shift away from goods-producing industries points to ongoing structural changes in how Canadians work and where the economy is growing.
Wages Growing Slowly as Inflation Pressures Linger
Wage growth remained modest in June. Year-over-year gains came in around 3.3%, according to MarketScreener. That is well below the 5.2% wage growth seen in 2024, suggesting that pay increases are cooling alongside broader inflation pressures.
In 2024, the Bank of Canada cut its policy rate to 4.75% in June as inflation eased. Now, with unemployment hovering near 6.5% and wage growth slowing, the central bank faces pressure to keep policy steady rather than cut too fast. Analysts had projected the rate could hover near 6.6% into mid-2025 before this latest data came in lower.
Rapid Immigration Growth Strains the Job Market
A key tension in Canada's labor market is the speed of population growth. In 2024, the labor force grew by 185,000 people while only 156,000 jobs were created, according to Yahoo Finance. That gap puts upward pressure on unemployment even when hiring looks healthy on the surface.
Many of the newcomers entering the labor force are immigrants who face structural barriers to finding work in their fields. Until job creation keeps pace with population growth, Canada's unemployment rate is unlikely to fall sharply — even as sectors like hospitality keep adding workers month after month.
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