Employment in Canada fell by -25k in January, a sharp miss versus expectations for a modest 7k gain and a clear sign of near-term labor market softness. The decline was driven by a steep drop in part-time jobs (-70k), which more than offset gains in full-time employment (45k).
Meanwhile, Headline unemployment fell sharply from 6.8% to 6.5%, beating expectations of 6.8%, and marking its lowest level since September 2024. However, the improvement was driven by a sizeable drop in labor force participation rather than stronger hiring, with the participation rate falling 0.4ppt to 65.0%. Employment rate slipped from 60.9%. to 60.8%, its first decline since August.
Wage pressures continued to ease at the margin. Average hourly wages rose 3.3% yoy, down slightly from December’s 3.4% yoy.
, which more than offset gains in full-time employment (45k).){kind=link}