Canada’s job market showed resilience in June as the economy added 18,000 jobs, maintaining the positive trend from the previous month. The latest data from Statistics Canada revealed that this modest job growth helped push down the unemployment rate to 6.5%, aligning with the rate recorded in January.
Economists had predicted a net increase of 10,000 jobs, following a significant surge of 87,800 jobs in May, with an expected unemployment rate of 6.6%. The job gains in June were predominantly in part-time positions and industries such as accommodation and food services, as well as wholesale and retail trade.
Despite the increase in employment, BMO’s chief economist, Doug Porter, cautioned against viewing the figures too optimistically, suggesting that the hiring might be temporary due to events like the World Cup. Similarly, CIBC economist Andrew Grantham hinted that the recent job growth could stall post the FIFA event.
On the flip side, the manufacturing sector experienced a decline, shedding 17,000 jobs, attributing to a total loss of 61,000 positions since the peak in January 2025, partly due to U.S. tariffs impacting the industry negatively.
The youth job market displayed positive signs in June, with the unemployment rate among young individuals dropping by 0.7 percentage points to 12.7%. Additionally, there was an increase of 33,000 jobs for workers aged 15 to 24. Despite this improvement, the youth unemployment rate remains higher than the pre-pandemic average observed from 2017 to 2019.
Students seeking summer employment also fared better compared to the previous year, with a decrease in the unemployment rate for those planning to return to school in the fall. However, the rates in both youth and student employment categories still exceeded pre-pandemic averages.
In terms of wage growth, average hourly wages for permanent employees increased by 3.7% in June, up from 3.2% in May. Overall, analysts noted that the job market exhibited moderate growth in June, following a challenging start to the year, where Canada lost a net of 112,000 jobs in the first four months of 2026.
The latest job report is unlikely to prompt any immediate changes in interest rates by the Bank of Canada, as economists Grantham and Porter suggested. The central bank’s upcoming interest rate decision following the release of the jobs report on Friday will provide further insights into the state of the economy.