Canada Adds 75,000 Jobs As Unemployment Falls To 2-Year Low

Canada’s economy added 75,000 jobs in July, pushing the unemployment rate down to 6.4 per cent, its lowest level in two years, as the labour market continued to show resilience despite ongoing trade tensions with the United States.

Statistics Canada, in data released on Friday, said employment growth was evenly split between full-time and part-time positions and spread across several sectors, including finance and construction.

The gain significantly exceeded analysts’ expectations of about 20,000 new jobs and reinforced the Bank of Canada’s assessment that businesses are adapting to the impact of US President Donald Trump’s trade restrictions.

The figures also contrasted sharply with the United States, which recorded a loss of 23,000 jobs in July, falling well short of analysts’ forecasts.

Reacting to the data, TD Bank said the labour market was showing “clear signs of recovery” and projected that unemployment would continue to edge lower through the remainder of the year. However, the bank warned that risks to the economy remained, citing Trump’s plan to impose 50 per cent tariffs on selected Canadian goods from August 19.

Prime Minister Mark Carney said his government was working with Washington to prevent the new tariffs while pursuing negotiations on a revised North American free trade agreement.

Although Trump signed the United States-Mexico-Canada Agreement (USMCA) during his first term, he has argued that the pact no longer serves US interests and has called for it to be overhauled. Despite recent tariff measures that have breached parts of the agreement, most trade between Canada and the United States remains tariff-free.

RBC said the USMCA continues to provide a critical safeguard for Canadian exports to the United States but warned that any broad collapse of bilateral free trade would have severe consequences for the Canadian economy.