Canada's labour market added 75,000 jobs in July 2026, bringing the national unemployment rate down to 6.4 per cent, its lowest level in two years, according to the Labour Force Survey released by Statistics Canada on Friday, August 7. This development comes amid the ongoing 'japa' trend, where Nigerians and other nationals emigrate in search of better opportunities.
Ontario Leads Provincial Gains
Ontario posted the largest provincial gain, adding 52,000 jobs, a 0.6 per cent increase, concentrated in professional, scientific and technical services. British Columbia recorded 18,000 new positions, while Manitoba and Nova Scotia each saw employment rise by 0.8 per cent, adding roughly 5,900 and 4,600 jobs respectively.
The gains were recorded across both full-time and part-time positions, with the wholesale and retail trade sector accounting for 21,000 of the new jobs. Employment growth was strongest among workers aged 25 to 54, largely driven by women in that age group. The unemployment rate for women aged 25 to 54 fell to 5.2 per cent, while the rate for men in the same age bracket remained unchanged at 5.8 per cent.
Economists Weigh In
CIBC senior economist Andrew Grantham described July's figures as "well above" forecasts, attributing the result to "brisk hiring." He added that the student summer job market was stronger than it had been in two years, and that unemployment among young people aged 15 to 24 reached its lowest point since early 2024.
However, the picture for racialised youth was significantly worse. The July unemployment rate for Black youth stood at 22.6 per cent, compared with 15.4 per cent for Chinese youth, 13.9 per cent for South Asian youth, and 11.6 per cent for non-racialised and non-Indigenous youth.
Grantham also cautioned that despite the improvement, the overall 6.4 per cent rate remains about half a percentage point above what would be considered full employment in Canada, meaning it is not at a level that "will fuel domestically driven inflation."
Wage Growth Slows
BMO chief economist Douglas Porter observed that Canada's labour force has grown by fewer than 8,000 jobs per month on average over the past year, noting that "it doesn't take much in the way of job gains to carve down that jobless rate." He also flagged that average hourly wage growth had slowed to 2.8 per cent year on year in July, down from 3.3 per cent in June, which he called "the slowest in four years."
Statistics Canada noted Canada has added 181,000 jobs since April and 196,000 compared with the same period a year ago.
Future Outlook and Risks
Despite three consecutive months of job growth, analysts pointed to potential headwinds. Laura Ulrich, director of economic research at Indeed, said the sustained gains were encouraging but cautioned that stabilisation would need to hold into the autumn to confirm a genuine turning point.
Desjardins managing director Royce Mendes said businesses appeared to be adapting to trade-related pressures, but significant uncertainty remains. US President Donald Trump has threatened 50 per cent tariffs on a wide range of Canadian imports, set to take effect on Wednesday, August 19, 2026, while talks on the Canada-United States-Mexico Agreement are scheduled to resume in the autumn.
