Canada’s job market entered choppy waters last month, and the impact from tariffs have yet to be felt. Statistics Canada (Stat Can) data shows employment fell in March, with job losses concentrated in private sector employment. Unemployment has already been tracking significantly higher than pre-2020. However, fewer jobs and more people experiencing long-term unemployment boosted the rate even higher, reversing minor progress in recent months.
Canadian Employment Slipped Last Month, Entirely Private Sector
Canadian employment pulled back last month. Employment fell by 33k jobs (-0.2%) to 20.96 million in March. The decline was almost entirely due to private sector job losses (-48k; -0.3%), more than the headline loss. That indicates the blow was softened by more public sector expansion.
Job losses were concentrated mainly in Ontario (-28k jobs; -0.3%), and Alberta (-15k; -0.6%). On the flip side of the stat, Saskatchewan (+6.6k jobs; +1.1%) helped soften the blow at the national level.
Canadian Unemployment Rises, Long-Term Rate Surges
Seasonally adjusted unemployment in Canada.
Source: Stat Can.
Unfortunately, it doesn’t appear that the lost employment was just folks retiring. The unemployment rate climbed 0.1 points to 6.7% in March, returning to December’s level. The rate remains roughly a point higher than 2019. It’s worth recalling that one needs to be considered ready, willing, and able to work to be considered unemployed. That means full-time students and those not actively pursuing employment are excluded, even if they need work.
The first thought is that tariffs played a role, but that doesn’t appear to be the case. Only 14.7% of unemployed people exited unemployment last month, a drop of nearly 4 points compared to last year. At the same time, nearly 1 in 4 (23.7%) unemployed have been searching for work for at least 27 weeks, up 5.4 points from last year. That means they fit the definition of long-term unemployed, increasing the likelihood they will need re-training to enter the workforce.
Bluntly put, the unemployment churn is a lot slower than usual for Canada. Fewer people can exit the issue, helping the number snowball. An issue that started last year, but can get worse if the trade war doesn’t resolve amicably soon.
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