Canada experienced a loss of 68,000 jobs in September, as reported by Statistics Canada, marking the second consecutive month of declines. The unemployment rate rose by 0.1 percentage points to 6.5 percent, aligning with the rate at the beginning of 2026.
The job market figures defied the expectations of economists, who had predicted a gain of 9,200 positions for September. This followed an unexpected loss of 42,000 jobs in August, interrupting a positive trend in the labor market.
Statistics Canada data prior to the recent declines had shown an upward trend in employment, with 181,000 jobs added between April and July. Despite the recent losses, there is still a net increase of 95,000 jobs compared to the previous year.
Chief economist Doug Porter from BMO noted the volatility in job figures, emphasizing that consecutive monthly losses of this magnitude are uncommon. He described the results as disappointing, indicating potential economic struggles in the early fall.
The decline in job numbers was particularly notable in the educational services, health care and social assistance, and manufacturing sectors. However, there was a slight offset by an increase in “other services” jobs, such as repair and maintenance.
Porter suggested that the decrease in education-related jobs, mainly in Quebec, could be temporary or indicate underlying weakness in the sector due to reduced international student enrollment. Additionally, senior economist Andrew Grantham from CIBC highlighted that manufacturing losses may be linked to the impact of new tariffs implemented in August.
Statistics Canada revealed that job losses affected both full-time and part-time positions, predominantly in the public sector, which saw a reduction of 70,000 roles in the month. Conversely, the private sector experienced some job growth, providing a positive aspect within the report.
The decline in employment was more pronounced among youth aged 15 to 24, with 48,000 job losses reported. Core-aged women, between 25 and 54 years old, also saw a decrease of 28,000 positions, with an increase in the number of women in that age group actively seeking employment.
Provincially, Quebec led in job losses with 49,000 positions cut, followed by British Columbia with a reduction of 20,000 jobs. Conversely, Alberta added 23,000 new jobs during the same period.
The job data release precedes the Bank of Canada’s forthcoming interest rate decision scheduled for October 28. Economist Andrew Grantham suggested that despite data volatility influencing the job market, the decrease in job numbers may prompt the Bank of Canada to maintain interest rates without changes in the near future.