Canada Loses 42,000 Jobs as Unemployment Holds at 6.4%

Canada’s labour market weakened in August 2026, with employment falling by 42,000 positions while the national unemployment rate stayed at 6.4%.

Statistics Canada’s latest Labour Force Survey showed the employment rate slipped 0.1 percentage points to 60.8%. The monthly decline followed several months of gains, but conditions remained uneven across provinces, industries and age groups.

Employment Falls After Spring and Summer Gains

Employment dropped by 42,000 jobs, or 0.2%, in August. The decline came after a combined increase of 181,000 jobs between April and July.

Despite the monthly setback, employment remained above last year’s level. Canada had 217,000 more people employed than in August 2025, representing year-over-year growth of 1.0%.

The unemployment rate held steady at 6.4% after falling for three straight months from May through July.

Among workers aged 25 to 54, the unemployment rate for men rose to 6.0%, while the rate for women declined to 5.0%.

Youth Workers See Steeper Losses

Young Canadians were among the groups most affected. Employment among people aged 15 to 24 fell by 19,000 jobs, or 0.7%, in August. The youth unemployment rate edged up to 12.9%.

However, returning students saw some improvement compared with last year. Their unemployment rate averaged 15.9% between May and August 2026, down from 17.9% over the same period in 2025.

Manufacturing Adds Jobs

Manufacturing stood out as one of the stronger sectors, adding 22,000 jobs, an increase of 1.2%. Most of those gains were recorded in Ontario.

Several other sectors moved in the opposite direction. Employment fell in business, building and other support services, public administration, natural resources and utilities. Business, building and other support services posted the largest decline, losing 20,000 positions.

Ontario and Quebec Lead Provincial Losses

The biggest provincial employment declines occurred in Quebec and Ontario.

Quebec lost 19,000 jobs, with much of the decrease concentrated in the Montréal metropolitan area. Ontario lost 18,000 positions.

Ontario’s unemployment rate remained at 6.9%, while Quebec’s stood at 5.6%.

New Brunswick moved against the broader trend, adding 2,400 jobs during the month.

Wage Growth Continues to Slow

Average hourly wages rose 2.0% from a year earlier to $37.02 in August. That was slower than the 2.8% annual increase recorded in July and the 3.3% gain reported in June.

The August report also shows why the headline unemployment rate can mask different experiences across the country. Some workers and regions faced clear setbacks, while others saw gains. The contrast between manufacturing growth and losses in service-related sectors suggests job prospects remained highly dependent on where people lived and the type of work they were seeking.

The figures point to a mixed Canadian labour market. Overall employment declined, youth workers faced weaker conditions and wage growth slowed. At the same time, manufacturing expanded, unemployment remained steady and total employment was still higher than one year earlier.

For newcomers and job seekers, the results underline how sharply opportunities can differ by province, occupation and industry.