Canada’s labor market delivered a strong upside surprise in July, with employment rising 75.1K, far above expectations of 17.8K and accelerating sharply from 18.2K in June. Employment rate edged up 0.1 percentage point to 60.9%, while unemployment rate unexpectedly fell from 6.5% to 6.4%, against expectations for no change. That was lowest unemployment rate since July 2024 and marked third consecutive monthly decline, with rate now down 0.5 percentage point since April.
Job gains were also spread across several important private-sector industries. Wholesale and retail trade added 21K positions, finance, insurance, real estate, rental and leasing gained 18K, professional, scientific and technical services added 17K, while construction employment increased 16K. Those gains were partly offset by declines of -15K in public administration and -9.6K in agriculture.
Wage pressures nevertheless continued to cool, with average hourly earnings growth slowing from 3.3% to 2.8% yoy.
Data Summary
| Indicator | Actual | Expected | Previous |
|---|---|---|---|
| Employment Change | +75.1K | +17.8K | +18.2K |
| Unemployment Rate | 6.4% | 6.5% | 6.5% |
| Employment Rate | 60.9% | — | 60.8% |
| Average Hourly Wages y/y | +2.8% | — | +3.3% |
Key Takeaways
- Canada added 75.1K jobs in July, more than four times expectations of 17.8K and sharply above June’s 18.2K increase.
- Unemployment rate fell from 6.5% to 6.4%, reaching lowest level since July 2024. It has now declined for three consecutive months and by 0.5 percentage point since April.
- Employment rate increased from 60.8% to 60.9%, reinforcing strength of headline employment gain.
- Job creation was relatively broad, led by wholesale and retail trade (+21K), finance and real estate-related industries (+18K), professional and technical services (+17K), and construction (+16K).
- Public administration shed 15K jobs and agriculture lost 9.6K, providing some offset to private-sector strength.
- Wage pressures continued to moderate despite stronger hiring. Average hourly wage growth slowed from 3.3% to 2.8% y/y.
