Last Friday, Statistics Canada reported that the pace of hiring in Canada slowed considerably in February, raising concerns about the overall economy with the overhang of tariffs persisting. Hiring has pulled back in 2025 after a strong December, raising expectations for another rate cut from the Bank of Canada (BoC) this week. Here’s a deeper look at Canada’s labour market report.

• The Canadian economy added 1,100 jobs in February, well below the 20,000 economists expected, based on a Bloomberg survey. This marked the smallest number of job additions since the economy lost jobs in July 2024. The economy added 76,000 jobs in January.
• The part-time sector saw an increase in jobs over the month, but this was offset by a decline in jobs in the full-time sector. The retail and wholesale trade industry added jobs over the month, while the manufacturing sector lost jobs. The manufacturing sector contracted in February and could come under pressure as tariffs are put into place.
• Canada’s unemployment rate held steady at 6.6% in February. While coming down in recent months, it remains well above the 5.8% rate seen in February 2024, suggesting the labour market has weakened.
• Canada will now have a new leader who will seek to improve the labour market and broader economy. Mark Carney has been elected as the new leader of the Liberal Party. He will soon become the next Prime Minister of Canada, tasked with navigating the economy through difficult trade tensions with the US.

The BoC makes its next interest-rate announcement this Wednesday. The BoC is expected to lower interest rates, with tariffs expected to hinder Canadian economic growth and labour market conditions being muted. On April 2, reciprocal tariffs are expected to be put into place by the US. Meanwhile, China placed a tariff on some Canadian agricultural and food products, effective March 20.

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.