Canada saw a rise in its unemployment rate to 6.9% in April, hitting a six-month high as the economy shed 18,000 jobs, according to recent Statistics Canada data. This data reflects ongoing labor market challenges in the face of trade uncertainty and U.S. tariffs.
Despite adding 67,000 jobs since April 2025, Canada has experienced a net loss of 112,000 jobs since the beginning of this year. CIBC economist Andrew Grantham noted that Canada has faced job losses in three out of the four months of 2026, signaling a turbulent start for the labor market this year.
The decline in jobs primarily affected full-time positions, which saw a decrease of 46,700 jobs, partially offset by a gain of 29,000 part-time jobs. StatsCan reported that the overall employment decline in the first four months of 2026 was concentrated in full-time work, with a drop of 111,000 jobs between January and April.
Average hourly wages for permanent employees, a key metric monitored by the Bank of Canada to assess inflation expectations, increased by 4.8% compared to the previous year, slightly lower than the 5.1% growth in March.
The participation rate, which measures the economically active portion of the population over 15 years old, inched up to 65% in April from 64.9% in the previous month, indicating a higher number of people actively seeking employment.
Unemployment rates among core-aged workers (25 to 54 years old) and youth (15 to 24 years old) rose to six percent and 14.3 percent, respectively. The goods-producing sector, particularly vulnerable to U.S. tariffs, witnessed a loss of 26,800 jobs in April, while the services sector, accounting for the majority of Canadian employment, gained 9,100 jobs.
Despite analysts’ projections of a net job gain of 15,000 and an unemployment rate of 6.7%, the actual figures diverged. The Bank of Canada noted in its recent Monetary Policy Report that indicators like the employment rate and job vacancies indicate underutilized capacity in the labor market, despite modest layoffs.
Economic uncertainties stemming from the future of the North American free trade agreement and the repercussions of increased prices due to the Iran conflict have compounded the impact of U.S. tariffs on Canada’s economy for more than a year. Canada’s senior economist, Brendon Bernard, anticipates continued tough times in the job market in 2026, citing subdued economic growth and persistent challenges for job seekers.