Canada saw a decrease of 68,000 jobs in September, 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.
The job figures contradicted economists’ expectations of a gain of 9,200 positions in September, following a surprising loss of 42,000 jobs in August. Prior to these declines, data from Statistics Canada indicated a positive trend in employment, with 181,000 jobs added between April and July. Despite the recent setbacks, employment remains higher by 95,000 positions compared to a year ago.
BMO’s chief economist, Doug Porter, acknowledged the volatility of job figures, noting the rare occurrence of two consecutive months of significant job losses. Porter described the results as disappointing, indicating potential economic struggles in the early fall.
Sector-wise, declines were led by educational services, health care, and social assistance, as well as manufacturing. However, gains in “other services,” such as repair and maintenance, offset some of these losses. The decrease in education jobs, particularly in Quebec, could be attributed to various factors, including a potential decline in international student enrollment.
CIBC’s senior economist, Andrew Grantham, highlighted the likelihood of data volatility affecting the poor report, while also suggesting that manufacturing losses could be linked to the impact of new tariffs implemented in August.
The job losses were spread across full- and part-time work and were concentrated in the public sector, which saw a reduction of 70,000 roles in the month. On a positive note, the private sector added some jobs and remained stable.
The decline in jobs primarily affected youth aged 15 to 24, with 48,000 job losses reported. Quebec experienced the highest job losses among provinces, with 49,000 jobs lost, while Alberta added 23,000 positions.
The Bank of Canada will consider this latest employment data before its upcoming interest rate decision on Oct. 28. Grantham suggests that despite the job market volatility, the decrease in job numbers may prompt the Bank of Canada to maintain its current interest rates in the near term.