Last Friday, Statistics Canada released its Labour Force Survey for July, which showed Canada’s job market gaining momentum. Canada’s labour market has shown some signs of stabilizing in recent months after struggling over the first few months of the year amid ongoing trade tensions and rising geopolitical conflicts. The Canadian economy added jobs for a third consecutive month in July, with the unemployment rate dropping during each of those months.

• Employment rose by 75,100 in July, which was an increase from the 18,200 jobs added in June. July’s gains also topped the 20,000 job additions economists had expected, according to a Bloomberg survey.
• There were job gains in both the full- and part-time sectors over the month. Wholesale and retail trade, finance and construction posted strong gains in July, while public administration and agriculture shed jobs.
• Canada’s unemployment rate fell to 6.4%, its third straight monthly decline and the lowest level in two years. Since April, the jobless rate has fallen from 6.9%.
• Wage growth cooled off in July. Average hourly wages rose by 3.0% year-over-year in July, down from 3.7% growth in June.
• The US also released its main labour market report on Friday, which told a different story than in Canada. The US economy lost 23,000 jobs in July, which was its first decline since February 2026. The US unemployment rate ended the month at 4.1%, down slightly from June.

July’s report points to a Canadian labour market that appears to be improving, not just holding steady. Hiring is broadening across sectors and provinces, and more of the unemployed are finding work compared to a year ago. That’s a welcome signal for the Bank of Canada as it weighs the health of the Canadian economy against ongoing trade and geopolitical uncertainty, which is helping to keep inflation at elevated levels.

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.