Statistics Canada’s Survey of Employment, Payrolls and Hours (SEPH) painted a bit more upbeat picture of Canada’s labour market in January. The report showed that payroll employment increased in January after falling in December. However, the labour force survey had shown the labour market notably weakened during the first month of 2026. SEPH looks at the portion of the business survey focused on payroll jobs, while the labour force survey, which includes the unemployment rate, is a household survey looking at the broad picture of the labour market. Despite job additions based on SEPH, Canada’s labour market has slowed in 2026.

• According to the SEPH, payroll employment, which tracks the number of employees receiving pay and benefits from an employer, rose by 45,600 in January. This was a strong rebound from the revised 10,600 decline in payroll employment in December.
• Among sectors, educational services and construction added the most jobs during the month. Conversely, the retail trade sector lost the most jobs in the month, falling by 6,600.
• The number of job vacancies in January increased to 492,400. Job vacancies were down by 6.7% year-over-year in January. Retail trade had an increase in job vacancies over the month.
• Average weekly earnings increased by 2.0% year-over-year in January, accelerating from the 1.9% year-over-year increase in December.

Despite the encouraging SEPH report, concerns about the Canadian labour market are mounting as trade disruptions with the US persist. Furthermore, the conflict in the Middle East could push inflation higher and hinder overall consumer and business spending. However, things may settle if Canada and the US settle their trade issues and the Middle East conflict comes to an end. Canada is back at the table with the US to discuss trade, which is vital as the Canada-United States-Mexico Agreement is up for review this year.

If you would like to discuss this economic and market update or have questions about your finances and investments, please feel free to contact me anytime.