Canada jobless rate rises to 6.7%

Dimly lit Canadian office building exterior symbolizing rising unemployment and job losses

Key Points

01Canada’s unemployment rate climbed to 6.7% in October from 6.5%
02The economy shed 4,700 jobs in October, extending 2026 losses
03Private-sector employment fell by about 52,500 positions in the month
04Wage growth for permanent employees slowed to 2% year-on-year

Jobless rate rises to six-month high

Canada’s labour market weakened in October as the national unemployment rate rose to 6.7%, up from 6.5% in September and reaching its highest level in six months. Statistics Canada reported a net loss of 4,700 jobs in the month, signaling continued softness after earlier declines. The last time the jobless rate was higher was in April, when it stood at 6.9%.

The October figures contrasted with expectations for a modest rebound. Economists had forecast an increase of 13,600 jobs and an unemployment rate holding at 6.5%. Instead, Statistics Canada said the labour market continued to shed positions and absorb more people seeking work.

Composition of job losses

The overall decline in employment masked sharp differences between sectors. Private-sector employment fell by 52,500 positions in October, marking the first drop in this segment since February. By contrast, public-sector employment grew by 49,600 jobs, largely offsetting the private decline in headline totals.

The wholesale and retail trade sector led job losses in October. These declines were partly balanced by gains in construction and education, which added positions over the month. Despite this sectoral offset, total employment remained lower, contributing to the higher unemployment rate.

Full-time work showed particular strain, with declines pointing to weakness in more established parts of the labour market. Cumulatively, Canada has lost about 46,000 jobs so far in 2026, and the economy has shed an average of 4,590 jobs per month this year.

Wages and pressures on workers

Wage dynamics also softened alongside the rise in unemployment. Growth in average hourly wages for permanent employees slowed to 2% year-on-year in October, compared with 2.3% in September. The easing in wage gains suggests a moderation in pay pressures as labour conditions weaken.

Younger workers faced particularly challenging conditions. The unemployment rate for youth aged 15 to 24 rose to 13.7% in October, up from 13% a month earlier. This elevated youth jobless rate indicates that labour market weakness is not confined to any single age group.

More than one in four people aged 15 and older reported difficulties meeting essential expenses such as transportation, housing, food and clothing in the prior four weeks.

Key Takeaways

01Canada’s labour market in October was weaker than economists had expected, with higher unemployment and job losses instead of the anticipated rebound.
02Private-sector and full-time positions absorbed most of the damage, while gains in public-sector, construction and education roles were not enough to prevent higher unemployment.
03Softening wage growth and a sharp rise in youth unemployment highlight growing pressure on workers, reinforcing signs of broad-based labour market weakness across Canada.

References