Canada’s labour market experienced a setback in August 2026, as employment fell by 42,000 jobs while the national unemployment rate remained unchanged at 6.4%.

According to the latest Labour Force Survey from Statistics Canada, the employment rate declined by 0.1 percentage points to 60.8%. The monthly results reflect mixed conditions across the Canadian job market, with losses reported in several industries and provinces, while manufacturing recorded notable employment growth.

Canada Loses 42,000 Jobs in August 2026

Canadian employment declined by 42,000 positions, or 0.2%, in August 2026. The decrease came after several months of growth, with employment increasing by a combined 181,000 jobs between April and July.

Despite the monthly decline, Canada’s employment level remained higher than it was one year earlier. Employment increased by 217,000 jobs, or 1.0%, on a year-over-year basis.

The employment rate, which measures the percentage of Canadians aged 15 and older who are employed, fell to 60.8%.

Unemployment Rate in Canada Remains Unchanged

While employment declined, the unemployment rate in Canada remained at 6.4% in August.

The stable unemployment rate followed three consecutive monthly declines between May and July. However, employment conditions varied across different age groups and demographic categories.

Among Canadians aged 25 to 54, the unemployment rate for men increased to 6.0%, while the unemployment rate for women declined to 5.0%.

The results demonstrate that the overall unemployment rate does not always reflect the different employment challenges experienced by individual groups.

Youth Employment Records a Significant Decline

Young workers were among those most affected by the August employment decline.

Employment among Canadians aged 15 to 24 fell by 19,000 jobs, representing a monthly decline of 0.7%. The youth unemployment rate also increased slightly to 12.9%.

Although youth unemployment remained elevated compared with the national average, conditions for returning students improved compared with the previous year.

The unemployment rate for returning students aged 15 to 24 averaged 15.9% between May and August 2026, down from 17.9% during the same period in 2025.

Source: Canada’s Job Market Declines in August

Manufacturing Provides a Positive Sign for Canada’s Job Market

Not every industry experienced employment losses.

Manufacturing added 22,000 jobs in August, representing an increase of 1.2%. Most of the growth occurred in Ontario.

Meanwhile, several sectors recorded employment declines, including business, building and other support services, public administration, natural resources and utilities.

Business, building and other support services experienced the largest monthly decline, losing 20,000 jobs.

The contrasting results show that employment opportunities in Canada continue to vary significantly depending on industry and location.

Quebec and Ontario Experience Employment Losses

The August employment decline was concentrated largely in Quebec and Ontario.

Employment in Quebec fell by 19,000 jobs, while Ontario recorded a decline of 18,000 positions.

In Quebec, much of the employment loss occurred in the Montréal metropolitan area.

Ontario’s unemployment rate remained at 6.9%, while Quebec’s unemployment rate stood at 5.6%.

New Brunswick was among the provinces reporting positive employment growth, adding 2,400 jobs during the month.

Wage Growth Slows to 2.0%

Canadian workers continued to see an increase in average hourly wages, although the pace of wage growth slowed.

Average hourly wages increased by 2.0% year over year, reaching $37.02 in August 2026.

This was slower than the 2.8% growth recorded in July and the 3.3% increase reported in June.

The slower wage growth adds another important dimension to Canada’s changing labour market conditions.

What the Latest Canadian Employment Figures Mean

The August Labour Force Survey presents a mixed picture of Canada’s economy.

The country lost 42,000 jobs, youth employment declined, and several industries experienced reductions in employment. However, manufacturing added jobs, the unemployment rate remained stable, and total employment continued to exceed the level recorded one year earlier.

For newcomers and individuals planning to work in Canada, the latest figures highlight the importance of researching provincial labour markets and industries with stronger employment demand.

Employment conditions can vary considerably depending on occupation, province and sector.

Key Highlights

• Canadian employment declined by 42,000 jobs in August 2026.
• The unemployment rate remained unchanged at 6.4%.
• The employment rate fell to 60.8%.
• Youth employment declined by 19,000 jobs.
• Manufacturing added 22,000 jobs.
• Quebec lost 19,000 jobs and Ontario lost 18,000 jobs.
• Average hourly wages increased by 2.0% to $37.02.

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