Canada's job market showed signs of cooling in October, with the unemployment rate rising to 6.7% as the economy lost 4,700 jobs. This follows steeper declines in August and September, totaling 110,000 jobs lost over the two months. Sal Guatieri, a senior economist at BMO, described the numbers as "very disappointing," noting that job creation over the past year has been significantly lower than usual.
The job losses were primarily in the private sector, a shift from earlier weakness in the public sector. Guatieri attributed this to higher interest rates and new tariffs on Canadian goods, which have dampened business confidence. The Bank of Canada raised its key interest rate to 2.5% in late October, while the U.S. imposed 50% tariffs on Canadian goods in August.
Young workers, aged 15 to 24, faced particularly high unemployment, which increased to 13.7%. Avery Shenfeld, chief economist at CIBC Capital Markets, suggested that the economy is not generating enough jobs for this demographic. He also noted that Canadians are staying unemployed longer, with nearly one in four searching for work for at least six months.
Despite the weak job numbers, there are some signs of optimism. Cory Stahle, a senior economist at Indeed, reported a three percent month-over-month increase in job postings, particularly in engineering and logistics. However, he cautioned that more postings do not necessarily translate to more hiring, as employers remain hesitant due to uncertainty over trade talks with the U.S.