The Unemployment Rate Fell for the Right Reason

The latest jobs report shows Canada added 75,000 jobs in July, dropping the unemployment rate to 6.4%, the lowest level in two years.

Since April, the unemployment rate has fallen by 0.5 percentage points, a clear sign of positive momentum.

Youth unemployment held at 12.6%, down from 14.3% in April.

The overall employment rate was up 0.1 percentage points to 60.9%, and is up 0.2 points year-over-year. This is an indication that the unemployment rate is down because more Canadians are getting jobs, rather than because people are giving up on looking.

Sector by sector, here is how the employment picture shifted in July, per Statistics Canada:

Employment change by industry, July 2026
employment change (thousands)

• Wholesale and retail trade 21.1
• Finance, insurance, real estate, rental and leasing 18.0
• Professional, scientific and technical services 16.6
• Construction 15.7
• Manufacturing 11.1
• Business, building and other support services 9.4
• Health care and social assistance 8.3
• Transportation and warehousing 7.6
• Educational services 6.7
• Other services 0.3
• Utilities -1.6
• Accommodation and food services -4.4
• Information, culture and recreation -4.8
• Natural resources -4.9
• Agriculture -9.6
• Public administration -14.5

Overall, 58,000 jobs were added in the private sector, and there were 44,000 more self-employed workers than in June. At the same time, there were 27,000 fewer public sector workers. As noted by Statistics Canada, “Since April, employment growth has been concentrated among private sector employees (+146,000; +1.1%) and self-employed workers (+73,000; +2.7%).” Canada has now more than recovered the over 100,000 jobs that were lost earlier this year.

Canada still faces significant challenges, and many Canadians are struggling. Those struggles cannot be dismissed. Hourly wage growth slowed from 3.3% to 2.8%, tied with the most recent inflation reading from June.

At the same time, we can acknowledge and celebrate that even amid trade turmoil, conflicts around the globe, and efforts by the U.S. President to use “economic force” to erode Canadian sovereignty, our economy is creating jobs and showing resilience and strength. With hiring concentrated in the private sector, and more Canadians finding work, Canada has real momentum to build on.

Spencer Fernando