Canada Unemployment Rate Climbs to Six-Month High of 6.7% — Update

By Robb M. Stewart

OTTAWA--Canada's labor market softened again last month, with a dip in employment and rise in the number of people hunting for work pushing the jobless rate to a six-month high.

Employers cut a net 4,700 jobs in October, building on the 110,000 positions lost over the previous two months, Statistics Canada said Friday. That pushed up the unemployment rate for a second straight month, taking it to 6.7%.

The jobless rate remains 0.2 percentage point below where it stood a year earlier, and below the recent peak of 6.9% in April, but employment has now fallen by 45,900 this year. The consensus forecast among economists was for the economy to have added a modest 15,000 jobs last month to leave the unemployment rate steady at 6.5%.

Job losses were concentrated in full-time work, and in the private sector, where work fell for the first time since February. The continued pullback for the month was moderated by a rise in part-time work and by the first increase in public-sector employment in five months, coinciding with temporary hiring amid provincial elections and a referendum in Alberta.

When calculated using U.S. Labor Department methodology, Canada's unemployment rate slipped 0.1 percentage point to 5.5%.

Uncertainty and trade tensions continue to weigh on business sentiment as energy costs remain elevated and following another round of tariffs imposed on Canadian goods by the U.S. administration. Surveys suggest hiring intentions have weakened of late, with the Canadian Federation of Independent Business noting that 22% of small businesses plan to lay off workers and only 11% aim to hire, the weakest net position since the pandemic.

The layoff rate in Canada continues to hold steady, standing at 0.7% last month compared with 0.6% a year earlier.

Still, just under one in five Canadians without a job in September found work in October, with a job-finding rate of 18.9% trailing the 19.8% rate seen 12 months prior and also coming in below the 24.6% average from 2017 to 2019, before the Covid-19 pandemic.

Statistics Canada said that, among the 1.5 million people who were unemployed in October, almost 24% were in what is considered long-term unemployment, meaning they have been continuously searching for work 27 weeks or more. That is above nearly 22% a year earlier and the prepandemic average of 17.2%.

The Bank of Canada has cautioned economic activity is likely to weaken in the final quarter of the year as new U.S. tariffs weigh, though it expects growth to pick up again in 2027 as consumers continue to spend and as business investment strengthens. Still, the central bank remains worried about the deteriorating outlook for inflation, which last month prompted it to raise its policy interest rate for the first time in more than three years.

Employment in wholesale and retail trade in Canada continues to trend lower, falling by about 29,000 in October. There also was a nearly 17,000 drop in manufacturing jobs, as well as weakness in natural-resources and utilities jobs.

However, employment in construction increased by about 16,000 and rose about 15,000 in educational service to partially offset a sharp drop in September.

There were 18,100 fewer full-time jobs for the latest month, though there was a rise of 13,400 in part-time roles. The number of private-sector employees fell by 52,500, while public-sector employment was up 49,600. The ranks of the self-employed slipped 1,800.

Canada's labor force expanded by 28,000 in October, though was down by 26,600 on a year earlier.

The participation rate--the proportion of the working-age population who were either employed or unemployed--was steady at 64.8% in October.

The employment rate, or the proportion of the working-age population that is employed, declined slightly to 60.5% from 60.6%.

Wage growth cooled for the month. Average hourly wages for permanent employees rose 2% on a year earlier, following a 2.3% rise in September.

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

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November 06, 2026 09:13 ET (14:13 GMT)