Canada's Job Market Suffers Surprise 42,000-Worker Loss
Canada's labour market took a surprise hit in August, shedding 42,000 jobs as new US trade duties began to take effect. The Bank of Canada's October rate decision is now back in play after the unexpected loss.
The unemployment rate remained steady at 6.4% for a second consecutive month, but a closer look reveals a broader decline in conditions. Full-time positions fell by 35,900 while part-time employment dropped by an additional 5,800.
The public sector accounted for the largest share of job losses, shedding 20,000 positions for its third consecutive monthly decline. Regional losses were concentrated in Quebec and Ontario, which lost 19,000 and 18,000 jobs respectively.
Despite a year-over-year gain of 217,000 positions, the economy's momentum has been dampened by the US tariff escalation that began in August. The Bank of Canada has held its overnight rate at 2.25% for seven consecutive months, but rising bond yields and shifting mortgage rates are changing the outlook for Canadian borrowers this fall.