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Canada added 47,000 new jobs in September, bringing the unemployment rate down to 6.5%, its first decline since the beginning of the year, according to the country’s statistical agency. The surge in job creation exceeded analysts’ expectations, marking a notable improvement after months of stagnation.
The gains were concentrated in full-time positions within the private sector, though total hours worked dropped 0.4%, and wage growth slowed. Despite the positive numbers, TD Bank senior economist Leslie Preston noted, “September’s jobs report does not change the picture of a labor market that has cooled notably since the Bank of Canada started raising interest rates.”
The central bank has been raising rates since March 2022 to control inflation, but with inflation now easing, the bank has shifted its strategy. Analysts expect a rate cut during the next meeting on October 23, with predictions ranging from a 25 to 50 basis point reduction.
Employment growth was observed across several sectors, including information, culture and recreation, wholesale and retail trade, and professional services. The number of private sector employees rose for the second month in a row, while public sector jobs declined. Full-time employment saw its biggest increase since May 2022, partially offset by a drop in part-time work. Average hourly wages grew by 4.6% over the month.
