Canada Unemployment Rate Slips to 6.5% in June — Update

By Robb M. Stewart

OTTAWA--Canada's unemployment rate edged down to a six-month low in June, thanks to a stronger summer job market and a pickup in job finding.

Employers in the country added 18,200 jobs last month, Statistics Canada said Friday. That built on the strong 87,800 rise in employment in May and continued to roll back the sharp drop in job numbers early in 2026.

Continued hiring alongside a steady labor market participation rate helped push the jobless rate down to 6.5%, matching January's level.

Economists were expecting a modest 10,000 jobs to be added to the economy, leaving the unemployment rate steady at 6.6%.

The jobs report is one of the last major indicators laying the groundwork for the Bank of Canada's policy meeting next week. The central bank will decide Wednesday whether to hold interest rates steady for a sixth time in a row, as it balances a weak economy and the risk of price pressures due to elevated energy costs.

When calculated using U.S. Labor Department methodology, Canada's unemployment rate declined 0.1 percentage point to 5.3% in June.

Job gains for the month were concentrated in part-time positions, and driven by the services sector.

Employment was up in particular for accommodation and food-service roles and in wholesale and retail trade. That helped counter falling job numbers in manufacturing, a sector that has been hard hit by trade uncertainty and tariffs, and where employment had dropped by about 61,000 from a recent peak in January 2025.

Compared with a year earlier, overall employment in Canada is up by 99,000 jobs, and despite softness in June this has been led by a roughly 131,000 rise in full-time work and the private sector.

The job-finding rate in the country hit 24.3% last month, up from a 21.3% of unemployed people who found work one month to the next 12 months earlier. At the same time, the layoff rate remained steady at 0.6% in June, unchanged from a year prior and compared with the average seen from 2017 to 2019 before the Covid-19 pandemic.

The jobless rate among youth 15 to 24 fell 0.7 percentage point for the month to 12.7% in June, though it remains above pre-pandemic levels. Statistics Canada said the unemployment rate for returning students was down 2.1 percentage points from a year ago at 15.3%, but this too remains above the average 13% seen before the pandemic.

Recent business surveys point to a mixed picture of the job market. The Canadian Federation of Independent Business's monthly barometer found 12% of small companies plan to hire full-time staff and 11% intend to hire part-time employees over the next three months, despite the summer being the busiest season for tourism and other sectors. Still, S&P Global's purchasing managers' June survey of manufacturers found companies added to their staffing for a third month running to help deal with increased workloads.

Wage growth heated up in June and continued to outpace consumer price inflation that has been buoyed in recent months with the spike in gasoline prices. Average hourly wages for permanent employees rose 3.7% on a year earlier, up from the 3.2% advance the month before and just ahead of the 3.6% rise economists had expected.

Write to Robb M. Stewart robb.stewart@wsj.com

(END) Dow Jones Newswires

July 10, 2026 09:02 ET (13:02 GMT)