Statistics Canada’s March data revealed that the country’s unemployment rate increased to 6.7 percent from 6.6 percent in February, while total employment decreased with a net 32,600 jobs lost, representing the first decline in over three years.
Reuters reported that, as per Statistics Canada, the higher unemployment rate was the first increase since November. According to the Reuters article, the March data also showed a total of 1.5 million unemployed people and a steep decrease in full-time work.
Statistics Canada said that, among unemployed Canadians, around 44 percent were laid off within the last 12 months, with 18.4 percent of them most recently employed in the construction sector and 12.4 percent in wholesale or retail trade, according to Reuters.
Reuters noted that February saw generally flat job growth, while November to January was marked by a gain of 211,000 jobs.
Reuters said the uncertainty surrounding tariffs has compelled companies to exercise more caution with investing and hiring and make some layoffs.
“The wheels may be starting to fall off the Canadian labor market,” said Andrew Grantham, CIBC Capital Markets senior economist, according to Reuters.
Reuters said in its article that it polled analysts and economists, who predicted a net job gain of 10,000 people, a 6.7-percent increase in the unemployment rate, signs of a weakening job market, and more layoffs and recession in many countries as reciprocal tariffs and the resulting retaliation impact the global economy.
According to Reuters, Grantham expected “some further weakness in employment ahead, particularly in sectors most directly impacted by U.S. tariffs, which could see the unemployment rate peak slightly above 7 percent during the second half of the year.”
In February, Reuters reported that job losses in Canada had already begun in certain sectors.
Reuters said that, according to the Bank of Canada, the average hourly wage growth of permanent employees was 3.5 percent in March, down from four percent the previous month.
According to Reuters, the bank said in February that Canadians were more concerned about their job security and financial health and were planning to spend more carefully due to the recent trade-related issues.