Growth Returns on Lower Path for Canadian Economy

The recent jobs report in Canada showed a significant increase in employment and a decrease in the unemployment rate, leading some to describe the economy as 'on fire.'

However, according to economist Trevor Tombe, this is not entirely accurate. He argues that while growth is returning, it's on a permanently lower path.

The July jobs report showed an increase of 75,000 in employment and a fall in the unemployment rate to 6.4 percent. However, this figure comes with a margin of error of around 66,000, making single-month data unreliable.

When looking at trend data, the economy is improving, but not sharply. The trend unemployment rate has been falling since mid-2025 and now sits near 6.5 percent.