OTTAWA — Canadian job seekers and young workers are struggling through the dog days of summer even as the labour market shows limited strain from U.S. tariffs.
Statistics Canada on Friday reported 41,000 job losses last month, while economists had expected a slight gain.
The unemployment rate was unchanged at 6.9 per cent in July as StatCan said the number of job seekers held steady month-to-month.
The economy lost 51,000 full-time positions in July, and the bulk of the losses were in the private sector. The information, culture and recreation sector led the drop in employment, followed by construction.
Doug Porter, chief economist at BMO, said in a note to clients that July’s jobs report marked the weakest in three years, according to the bank’s report card.
He noted that total hours worked fell 0.2 per cent in July, marking a poor start to the third quarter for Canada’s economy.
“This is an unambiguously weak report … although it comes hard on the heels of an unambiguously strong report,” Porter said.
July’s drop in jobs partially offsets an unexpected gain of 83,000 positions in June.
Average hourly wages meanwhile rose 3.3 per cent on an annual basis in July, up a tick from June.
Brendon Bernard, senior economist at jobs search site Indeed, said in an interview that the “malaise” he’s seen in Canada’s labour market in recent years stretched into the summer.
But while Canada’s economy remains beset by U.S. President Donald Trump’s trade war, Bernard said he didn’t see clear signs of tariffs impacting the July job numbers.
StatCan said the layoff rate – the proportion of people employed in June but laid off in July – was virtually unchanged at 1.1 per cent from the same month a year ago despite the economic uncertainty.
The manufacturing industry and the transportation and warehousing sector — two areas Bernard said he’d expect to see tariff impacts — both posted job gains in July.
Regionally, job losses were also concentrated in Alberta and British Columbia, not Quebec or Ontario.
“That’s not the markings of all this trade uncertainty dragging on the numbers,” Bernard said.
“Instead, we see familiar trends that have cropped up over the past few years: weak youth job numbers, struggles of unemployed people finding new work.”
Youth aged 15 to 24 lost 34,000 positions last month while the employment rate for the age group fell to 53.6 per cent – the lowest level since November 1998, outside the COVID-19 pandemic.
Bernard said the youth summer jobs market starts in May and peaks in July, and the latest labour figures show the entire summer has been a slog for young workers.
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