Canadian employment stumbled after a multi-month winning streak that seemed to defy gravity. Statistics Canada’s (StatCan) Labour Force Survey (LFS) shows employment dropped sharply in August. On its own, it’s not particularly concerning as it only rolls back a fraction of the huge gains made recently. What is concerning is that temporary roles accounted for most of the employment growth—nearly 4x the usual rate.
Canada Lost 41.7k Jobs, But Still Up 216.5k Roles Since Last Year
Seasonally adjusted Canadian employment fell 0.2% (-41,700) to 21.17 million in August. It was a sharp drop, but it followed a growth boom from April to July where 181,000 jobs were added. Even with the sharp downtick, employment remains 1.0% (+216,500) higher than last year. The losses are concentrated in full-time jobs, representing 35,900 of last month’s losses.
Canadian Unemployment Rate Unchanged As Workforce Shrinks
The seasonally adjusted unemployment rate.
Source: StatCan.
Hefty job losses didn’t impact the 6.4% unemployment rate, which remains unchanged. The labour force, those employed or actively looking for work, fell by 36,800 in August. Since there were 41,700 jobs lost, the unemployed population rose by 4,800 people. However, the participation rate fell 0.1 percentage points to 65.0%, helping to keep the unemployment rate unchanged at 6.4%. The combination produces headline data that shows stalled employment, but it’s a little worse. Regardless of how these numbers are diced, they show fewer workers carrying the economy.
Public Sector Jobs Drive Losses, But Were Mostly Expected
The composition of job losses shows that much of the shedding should be expected. Public-sector employment contracted 0.4% (-20,000), a third month of declines, and 1.7% (-78,000) lower than it was in May. Federal public administration added 22,400 jobs from April to June, driven by the 2026 Census. The wind-down of those temporary roles likely explains a meaningful share of the recent weakness in public administration, though it doesn’t explain the broader decline in public-sector employment.
Private-sector employment was mostly unchanged in August, but grew 1.1% (+156,000) since last year. Self-employment was also up 3.0% (+80,000), showing a healthy gain after taking a serious hit post-pandemic. Though it’s unclear how much of that self-employment meets the agency’s definition of “gig worker.”
Most Employees Added In The Past Year Are Temporary
Those skeptical of the lasting power of this trend in the current global economy have reason to be. Unadjusted data shows employment grew by 133,500 over the past year. While temporary roles represent just 13.8% of total employment, they accounted for 68,400—or 51%—of those added positions. It’s a dramatic shift that deserves its own deep dive to understand what’s happening here.
The job losses in August may be a surprise to some, but some balance should be expected after the run of gains. Even after factoring in recent losses, the job numbers still show impressive growth. The risk flying under the radar isn’t the headline data, but the tenure of the roles being added. Temporary work still represents a small share of employment, but it’s suddenly responsible for most growth. The sudden shift leaves recent gains on shaky footing.
boomers will just keep voting to host big temporary events, and pretending that taxpayers borrowing for temporary employment is a strong economy.
Imagine how bad this would have been with PP in charge? He would have gutted the private industry while allowing Alberta to burn down so he can give the Laurentian’s access to the entire oil industry.