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Canada’s unemployment rate rose to a six-month high of 6.9 per cent in April as the economy lost 18,000 jobs, Statistics Canada data showed on Friday, indicating a continued weakness in the labour market which has struggled in the face of U.S. tariffs and trade uncertainty.
While Canada has added 67,000 jobs since April 2025, since the start of this year it has lost a cumulative 112,000.
Last month’s loss means Canada has lost jobs in three out of the four months so far this year, showing a rocky start for the labour market in 2026, according to CIBC economist Andrew Grantham.
The drop was concentrated in full-time jobs, which lost a net of 46,700 people, offset only by a gain of 29,000 jobs in the part-time sector.
The net overall decline in employment over the first four months of 2026 was also concentrated in full-time work, which fell by 111,000 between January and April, according to StatsCan.
Average hourly wages of permanent employees, a metric closely tracked by the Bank of Canada to gauge rise in inflation expectations, grew 4.8 per cent from a year earlier, versus 5.1 per cent in March.
The participation rate — the portion of the population over the age of 15 that is economically active — edged up to 65 per cent in April from 64.9 per cent in the prior month, StatsCan said.
A higher participation rate along with a higher unemployment rate indicates more people were searching for work.
Canadians between 15 and 24 are struggling to find work. One young job seeker said they applied to 100 companies without getting an interview.
The unemployment rate among the core-aged workforce of those aged 25 to 54, as well as among the youth, increased to six per cent and 14.3 per cent, respectively.
The goods-producing sector, which is the most exposed to U.S. tariffs, saw employment drop by 26,800 jobs in April, while the services sector, where four out of every five people are employed in Canada, reported a 9,100 job gain.
On the other side, the health-care and social assistance sector and the business and building sector both posted job gains in April.
Analysts polled by Reuters had predicted net job gains of 15,000 and the unemployment rate of 6.7 per cent, almost mirroring the month of March when employment rose by 14,100 and jobless rate was the same.
The Bank of Canada said in its Monetary Policy Report last month that indicators such as the employment rate, hours worked and job vacancies suggest slack, or underutilized capacity, in the labour market, although layoffs remain modest.
The looming uncertainty around the future of the North American free trade deal and the knock-on impacts of the higher prices from the Iran war has continued to layer over the impact of U.S. tariffs on the economy for over a year.
Indeed Canada’s senior economist, Brendon Bernard, said subdued economic growth indicated that tough times in the job market were likely to continue in 2026.
“Difficult conditions facing job seekers, whether it’s youth looking to break into the market, or the unemployed trying to get back to work, linger. There’s little sign of shifting into high-gear any time soon,” Bernard wrote in a note.
