In September, Canada saw a decrease of 68,000 jobs, as reported by Statistics Canada, marking the second consecutive month of job losses. The unemployment rate rose by 0.1 percentage points to 6.5%, the same level as at the beginning of 2026.
This decline was unexpected, as economists had predicted a gain of 9,200 positions for September, following a surprise loss of 42,000 jobs in August. Prior to these back-to-back declines, there was a positive trend in employment, with 181,000 jobs added between April and July, resulting in a net increase of 95,000 positions compared to the previous year.
BMO’s chief economist, Doug Porter, noted the volatility in job figures and expressed concern over the consecutive months of significant job losses, describing the results as disappointing and indicative of economic challenges in the early fall.
The job losses were predominantly observed in sectors such as educational services, health care, social assistance, and manufacturing, with a slight offset in “other services” like repair and maintenance. The decline in education jobs, particularly in Quebec, may reflect challenges within the sector, possibly influenced by a decrease in international students.
CIBC’s senior economist, Andrew Grantham, suggested that while some data fluctuations may have influenced the report, the losses in the manufacturing sector could be linked to the impact of new tariffs implemented in August.
Statistics Canada revealed that the job losses affected both full-time and part-time positions, with a concentration in the public sector, which experienced a reduction of 70,000 roles in the month. However, the private sector showed resilience by adding some jobs and remaining stable.
The decline was most notable among youth aged 15 to 24, accounting for 48,000 job losses, while core-aged women (25-54 years) also experienced a decrease of 28,000 positions. Among provinces, Quebec led with 49,000 job losses, followed by British Columbia with 20,000 fewer jobs, while Alberta added 23,000 positions.
The latest job data will influence the Bank of Canada’s upcoming interest rate decision on Oct. 28. Grantham suggested that despite the data volatility, the job market’s weakness is likely to prompt the Bank of Canada to maintain its current interest rates for the near future.