Canada Sees Unemployed Workers Rise Nearly 20% In Just One Year

Canada’s economy continues to struggle with job creation that keeps up with its population. Statistics Canada (Stat Can) data shows the unemployment rate was unchanged in December. However, the population growth means nearly 20% more unemployed than last year. That excludes the demand for work from international students—many attracted by promises of working extended hours while they study.

Canada Added 202k More Workers Than Jobs Over The Past Year

Canada’s record population boom continues to add more people than jobs. The working-age population (15 years or older) rose 0.22% (+74.2k people) to 32.95 million in December. At the same time, the number of employed individuals rose 0.02% (+4.8k) to 21.56 million over the same period. The combination helped to drive the employment rate 0.2 points lower to 61.6%. Roughly 2 in 5 working-age adults are unemployed or not in the market for work—a relatively high level considering Canada is the youngest G7 country. 

Over the past year, the labor force has added 632k people to reach 21.56 million people. During that period, the economy added 430k jobs to hit 20.31 million. Failing to keep up with growth is creating a lot of unemployment, an issue obfuscated by the rate.

Canada Has Nearly 20% More Unemployed People Than Last Year

Canada has seen the unemployment rate rise significantly over the past year. The unemployment rate hit 5.8% in December, rising five of the past seven months. Since April, it has added 0.8 points, the same increase observed over the past year.  

Unemployment is low as a rate, at least from a historical perspective—but it’s still a lot of people. Unemployed individuals hit 1.2 million people in December, up 19.3% (+202k people) from last year. Before the pandemic, August 2019 was the last time the rate reached 5.8%, and it did so with 70.8k fewer unemployed workers. It may not register much as a rate, but a lot of people are searching for work. That’s problematic, especially when GDP is refusing to budge

Unemployed Canadians Surpass Pre-Pandemic Levels

The number of Canadians considered unemployed (“ready, able, and looking for work”).

Source: Statistics Canada; Better Dwelling.

In addition, Canada’s unemployment data also fails to capture rising stress among international students. The immigration minister has stated these students fulfill an essential role in labor demand, attracting students looking to study and work.  However, this demographic never counts towards the unemployed count—only those employed.  

The problem of excluding these students is more apparent after a recent policy extension. At the end of December, a measure that allowed international students to work more than 20 hours was supposed to expire. It was extended after criticism regarding the inability of students to afford to study without working more than 20 hours alongside classes.

It’s easy to dismiss the data from a high level by looking at the rate. However, clear problems are building up. Methodology and rates can conceal the extent of the issue, but mounting liabilities are still liabilities the economy will face. 

4 Comments

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  • Frank 4 months ago

    Not to draw attention to politics, but the abhorrent influx of new people with nowhere to house them letalone find employment, many are leaving in droves. Someone is in panic mode and has said housing is not a federal responsibility, then flip flops and makes it an emergency. Buying votes by any party is nothing new, but when done in this fashion dumping the problems on municipalities relying on shelters and church groups to take up the slack is a leadership that will never accept responsibility. Hoping new People coming here can find a place to live and a job. Many realize with the high cost of living and the over reach of government many deciding to leave or become debt slaves.

  • Realtor Bob 4 months ago

    Need to drop rates to near zero to stimulate house prices to save the economy.

  • Andrew Baldwin 4 months ago

    I wondered how international students were treated in the LFS. This is very valuable to know, but also appalling. If international students enter the employed stats, but not the unemployed, do they suddenly drop out of the labour force when they lose their jobs, even if they are looking for work. Is this 0.2% drop in the participation rate mostly an increase in the number of unemployed international students?

  • Jim Atkinson 4 months ago

    We should halt all immigration to Canada until we resolve our problems. Homeless, Lack of Doctors and Nurses, Housing crisis, Hyperinflation, Employment as your article states. Government Spending
    and I could go on and on.
    This Liberal government is out of control! Trudeau should resign.

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