Canada’s labour market took a significant step backward in February, with the economy shedding 84,000 jobs and the unemployment rate rising to 6.7%, according to Statistics Canada’s Labour Force Survey released Friday morning.
The employment rate fell 0.2 percentage points to 60.6%, while job losses were recorded across both services-producing industries, which shed 56,000 positions, and goods-producing industries, which lost 28,000.
Analysts had expected the economy to add roughly 10,000 jobs in February, making the actual outcome one of the worst monthly job losses seen in years outside of the pandemic period.
The losses were concentrated among younger and prime-age workers. Employment fell by 47,000 among youth aged 15 to 24 and by 41,000 among core working-age men between 25 and 54, while employment was little changed for core-aged women and workers 55 and older.
The youth unemployment rate climbed to 14.1%, and among the 1.5 million Canadians who were unemployed in February, roughly 22.8% had been searching for work for 27 weeks or more, a level significantly above the pre-pandemic average of 17.1% recorded between 2017 and 2019.
Katherine Judge, a senior economist at CIBC Capital Markets, described the report as a “worrisome turn,” saying it shows that labour market slack has increased and economic activity appears frozen amid ongoing trade uncertainty.
Doug Porter, chief economist at BMO Capital Markets, called the report “a brutal result”:
There were some modest counterweights in the data. Average hourly wages rose 3.9% year-over-year to $37.56, suggesting workers who remain employed are still seeing meaningful wage gains. And while the unemployment rate has risen from January’s 6.5%, it remains below the recent peak of 7.1% reached in August and September of 2025.
Economists noted that further interest rate cuts by the Bank of Canada now appear less likely in the near term, given both the weak headline number and underlying signs of economic softening to start 2026.
The report lands at a difficult moment, as Canada navigates tariff pressures from the United States and a broader slowdown in economic momentum heading into spring.
The numbers are sobering, but Canadians have confronted hard chapters before and built something stronger on the other side. The task now, as always, is to do the same.
Spencer Fernando
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