Author: Norud Al Malis
(Bloomberg) — The Canadian economy added 66,600 jobs in October, marking the second straight month of unexpected job growth, while tariffs slowed economic activity.
Statistics Canada’s Labor Force Survey on Friday showed job gains helped the unemployment rate fall to 6.9 per cent.
Economists polled by Bloomberg expect the unemployment rate to hold steady at 7.1% and the economy to lose a modest 5,000 jobs.
Canada’s labor market also unexpectedly rose in September, adding 60,400 jobs.
Overall, the past two months have reversed the labor market weakness brought about by the U.S. trade war this year. Canada has added a net 164,500 jobs since January.
The three-month rolling average job growth was 20,500.
After the news was released, the Canadian dollar surged to the day’s high against the U.S. dollar, rising about 0.3% to 1.4070 Canadian dollars as of 8:35 a.m. in Ottawa. Canadian government bonds fell across the board, lagging behind major countries, with the two-year Treasury yield rising about four basis points to 2.43%.
Although Bank of Canada Governor Steve MacCallum downplayed the importance of September’s jobs report, two consecutive months of strong job growth may get the central bank’s attention.
Last month, the bank cut its key interest rate by 25 basis points for the second consecutive time to 2.25%. But Macklem said policy rates were now at “roughly the right level” and the central bank may not be able to further help the economy adjust to tariffs.
The Bank of Canada’s monetary policy report expects the economy to remain weak until 2027, a period Macklem called a “structural transition.”
Employment growth in October was driven by part-time work. Employment growth was mainly driven by industries such as wholesale and retail trade, transportation and warehousing, information, culture and entertainment, and utilities. Meanwhile, the largest number of job losses last month was in the construction industry.
Job gains were concentrated in Ontario, where employment rose by 55,000, the first increase since June.
The unemployment rate among young people, who have had particular difficulty finding work in recent months, fell 0.6 percentage points to 14.1%, the first decline since February.
The participation rate increased slightly to 65.3% in October.
The employment rate, which reflects the employment ratio of the working-age population, also rose to 60.8%.
Annual wage growth for permanent employees rose to 4%, compared with economists’ expectations of 3.5%.
Total hours worked fell by 0.2% in October due to labor disputes, but increased by 0.7% compared with the same period last year.
–With help from Curtis Heinzl and Carter Johnson.
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Last modified: November 7, 2025
