Canada in March marked the first drop in employment in three years, the national statistical agency said Friday, as uncertainty over US tariffs led businesses to cut staffing and stall hiring.
Some 33,000 net jobs were shed in the month, pushing the unemployment rate up 0.1 percentage points to 6.7 percent, according to Statistics Canada.
The jobs decline was driven by the loss of full-time work, which had seen a “strong upward trend in the second half of 2024,” the agency said in a statement.
The March losses were mostly in the private sector, in wholesale and retail, as well as information, culture and recreation.
Canada was largely spared from the sweeping global tariffs US President Donald Trump announced Wednesday, as Washington granted an exemption to goods compliant with the US-Canada-Mexico free trade agreement, which covers most products.
But on Thursday the two neighbors slapped tit-for-tat 25 percent tariffs on some vehicles crossing the border, coming after Washington imposed levies on Canadian steel and aluminum.
Washington had also announced but then paused tariffs on most Canadian goods and energy imports into the United States, saying they were in response to illegal immigration and the deadly drug fentanyl coming into the United States.
Economists had expected the Canadian job market to start to slow in March as companies held back on investments and hiring, which surged in December 2024 and January, adding 211,000 net new jobs, before flatlining in February.
“The wheels may be starting to fall off the Canadian labor market,” CIBC Economics analyst Andrew Grantham said in a research note.
The numbers, he noted, fell well short of consensus forecasts for a gain of 10,000 net new jobs.
However, he added that staffing levels “in areas expected to be the first (and) hardest hit by US tariffs were mixed, with transport and warehousing posting an increase while manufacturing employment fell modestly.”
TD senior economist James Orlando commented in a research note that “businesses and consumers are naturally hesitant in the face of heightened political uncertainty.”
“Today’s report reflects this,” he said, adding that Canadians who lost their jobs are also taking longer to find work.
AFP
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