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Statistics Canada showed an unemployment rate of 6.9 percent, with most cuts in the manufacturing sector.
Published On 9 May 2025
Canada’s unemployment jumped to its highest level since November as United States President Donald Trump’s imposed tariffs affect the export-dependent economy.
Statistics Canada showed a 0.2 percent increase for the month of April, bringing the country’s unemployment rate to 6.9 percent, according to its report released on Friday.
The 6.9 figure matched November unemployment, which was an eight-year high outside of the pandemic era.
The agency pointed to the effect tariffs imposed by the US had on the country’s manufacturing sector, which lost 31,000 jobs on a monthly basis. The wholesale, retail and trade sector saw 27,000 jobs cut.
Employment in the public sector increased by 23,000 or up 0.5 percent in April, following three months of little change, especially due to increased temporary hiring for the federal election that took place on April 28.
The average hourly wage growth of permanent employees, a metric closely watched by the Canadian central bank to gauge inflationary trends, was at 3.5 percent in April, unchanged since March.
Overall, the employment number was largely flat with minimal gains of net 7,400 jobs in April, it said – slightly higher than analyst expectations at 6.8 percent. This was in contrast to a loss of 32,600 jobs the prior month.
The employment rate, or the proportion of the working-age population that is employed, was at 60.8 percent in April, following a decline of 0.2 percentage points in March. This was a six-month low, the statistics agency said. The employment rate had been depressed for most of 2023 and 2024 as population growth outpaced employment gains. However, since February, population growth has not been very high but employment gains have slowed.
“People who were unemployed continued to face more difficulties finding work in April than a year earlier,” StatsCan said, adding that among those who were unemployed in March, 61 percent remained unemployed in April – almost four percentage points higher than the same period last year.
Major hit coming
Trump’s tariffs on Canadian steel and aluminium in March and automobiles in April, along with import duties on a broad range of products with various reductions and exemptions, have affected businesses and households.
The Bank of Canada has warned that growth would take a major hit in the coming months as exports fall, prices increase, hiring drops and layoffs accelerate. It has said it will act decisively if the economy needs urgent support.
“Overall, we are seeing a job market that was weak heading into the trade war, now looking like it could soon buckle. Today’s report supports the case for a Bank of Canada cut in June,” Ali Jaffery, senior economist at CIBC Capital Markets, told the Reuters news agency.
