Canada’s economy experienced a surge of 60,000 new jobs in September, surpassing expectations, with a significant portion of the growth stemming from the manufacturing sector, which has been vulnerable to tariffs. Statistics Canada revealed that the manufacturing industry saw an increase of 28,000 jobs, marking its first rise in employment since January when the U.S. trade war resulted in numerous job losses. Despite ongoing tariff uncertainty, the positive trend in trade-exposed industries indicates resilience in the short term, as highlighted by Brendon Bernard, a senior economist at Indeed.
The job gains were primarily concentrated in Ontario and Alberta, partially offsetting the 58,000 manufacturing job losses recorded between January and August of this year. The unemployment rate remained steady at 7.1 percent from August, as more individuals joined the workforce. While part-time employment declined by 46,000 positions, approximately 106,000 full-time jobs were added.
BMO’s chief economist, Douglas Porter, noted that the latest jobs report significantly exceeded expectations, reversing the previous month’s weak performance. However, Porter emphasized that overall employment has only marginally increased by 0.1 percent in the past eight months since the onset of trade uncertainties in late January.
In addition to the manufacturing sector, job growth was observed in health care and social assistance, adding 14,000 jobs, and agriculture, which saw an increase of 13,000 positions. Nevertheless, these gains were offset by a decline in wholesale and retail trade employment, which saw a loss of 21,000 jobs on a monthly basis.
Alberta led the provinces in job gains, adding 43,000 positions following declines in employment earlier in the year. New Brunswick saw an increase of 4,700 jobs, Manitoba added 3,900 jobs, while Quebec and Ontario experienced minimal changes in their employment rates.
The average hourly wage rose by 3.3 percent, equivalent to $1.17, reaching $36.78 compared to the previous year. Porter highlighted that Canada’s economy remains resilient amidst trade uncertainties, with the labor market being a key consideration for the Bank of Canada’s recent rate cut in September. With the labor market showing strength, a potential pause in rate adjustments is anticipated at the upcoming October meeting.
The next inflation report is scheduled for October 21, with the Bank of Canada’s interest rate meeting set for October 29.