{"id":62528,"date":"2025-07-31T11:57:38","date_gmt":"2025-07-31T11:57:38","guid":{"rendered":"https:\/\/www.pantheregroup.com\/2025\/07\/31\/posthaste-why-canadas-job-market-might-be-too-good-to-be-true\/"},"modified":"2025-07-31T11:57:38","modified_gmt":"2025-07-31T11:57:38","slug":"posthaste-why-canadas-job-market-might-be-too-good-to-be-true","status":"publish","type":"post","link":"https:\/\/www.pantheregroup.com\/2025\/07\/31\/posthaste-why-canadas-job-market-might-be-too-good-to-be-true\/","title":{"rendered":"Posthaste: Why Canada's job market might be too good to be true"},"content":{"rendered":"

\n

\n\"\"<\/p>\n

Canada\u2019s <\/p>\n

job market<\/p>\n

appears to have stood up remarkably well to <\/p>\n

Donald Trump\u2019s tariff war<\/p>\n

so far, with the economy showing a surprise surge in jobs in June and the <\/p>\n

unemployment rate<\/p>\n

ticking down. <\/p>\n

\u201cIt seems too good to be true,\u201d Andrew Grantham, a senior economist with the <\/p>\n

Canadian Imperial Bank of Commerce<\/p>\n

, said in a report this week. \u201cUnfortunately, that\u2019s probably because it is.\u201d <\/p>\n

Grantham argues that the job market is likely weaker than \u201cadvertised\u201d in Statistics Canada\u2019s Labour Market Survey and the <\/p>\n

Bank of Canada<\/p>\n

is getting a wrong reading. What\u2019s really happening in Canada\u2019s labour market is that weakness is widespread and largely unrelated to the struggles of industries hit by Trump\u2019s trade war. <\/p>\n

\u201cThe notion that Canada\u2019s labour market is in good health, aside from understandable weakness in trade sensitive areas such as manufacturing, is too simplistic and likely incorrect,\u201d he said. <\/p>\n

\u201cActual employment growth over the past year may have been much slower than advertised by the LFS, including in sectors that should be less sensitive to trade uncertainties.\u201d <\/p>\n

Grantham argues that the Labour Market Survey has overstated <\/p>\n

population growth<\/p>\n

and that could lead to employment growth being revised down to a fraction of what is currently reported. <\/p>\n

\u201cWe suspect that actual population growth, and by extension employment, has been weaker than advertised by the LFS,\u201d he said. <\/p>\n

Canada\u2019s unemployment rate has climbed from 6.6 per cent to 6.9 per cent this year and Grantham said it\u2019s easy to assume manufacturing job losses brought on by the tariff war drove the increase. But looking deeper into the data, \u201conly 20 per cent of the decline in manufacturing employment appears to have been reflected in the unemployment rate.\u201d <\/p>\n

Some workers in this sector could have retired, temporarily left the labour force or found work in other sectors. <\/p>\n

This tallies with data that suggest the real reason for the rise in the unemployment rate over the past year is not people losing their jobs, so much as people entering the workforce having difficulty finding work, he said. <\/p>\n

Ontario, which has suffered the biggest increase in unemployment, reinforces this case. Jumps in the unemployment rate in industrial cities like Windsor and Oshawa accounted for only a fraction of the province-wide rise, he said. While greater Toronto, with its diverse economy, contributed to about half of it. <\/p>\n

The idea that labour market weakness is more widespread than reported is supported by the \u201cstall\u201d seen in the payrolls survey of employment (SEPH) over the past year, said Grantham. <\/p>\n

\"<\/p>\n

Getting a clear picture of what is really happening in the labour market is important because the Bank of Canada has used the strength in Labour Force Survey employment to justify holding interest rates at 2.75 per cent, he said. <\/p>\n

\u201cIf the Canadian labour market is weaker than advertised, this slack should eventually place downward pressure on core measures of inflation and bring a couple more <\/p>\n

interest rate cuts<\/p>\n

from the Bank of Canada later this year.\u201d <\/p>\n

\n

\u00a0Sign up here to get Posthaste delivered straight to your inbox.<\/strong><\/em> <\/p>\n

\n


\"\"<\/strong> <\/p>\n

\"<\/p>\n

The clock is ticking down to U.S. President\u2019s <\/p>\n

tariff deadline<\/p>\n

Friday, with still no news on a deal for Canada. Today\u2019s chart shows how the country\u2019s tariff rate ranks against other countries, some which have reached deals and some which have not. <\/p>\n

So far, Trump\u2019s trade deals \u201care really bad omens for Canada,\u201d William Pellerin, a trade lawyer and partner at the firm McMillan LLP, told the Canadian Press. <\/p>\n

\u201c(It shows) that the tariffs, particularly the sectoral tariffs, are stickier than we would have thought,\u201d Pellerin said. \u201cIf none of those countries were able to secure a drop in the sectoral tariffs, that is certainly bad news.\u201d <\/p>\n

Tariffs on Canadian imports are to rise to 35 per cent on Friday, but most will not be affected because they are compliant with the <\/p>\n

Canada-United-States-Mexico Agreement. <\/p>\n

\n

\"\"<\/p>\n

    \n
  • Today\u2019s Data:<\/strong> Canada GDP for May, United States personal income and spending<\/li>\n
  • Earnings:<\/strong> Bombardier Inc., Lightspeed Commerce Inc., Cenovus Energy Inc., TMX Group Ltd., Gildan Activewear Inc., Colliers International Group, Eldorado Gold Corp., Aecon Group Inc., Baytex Energy Corp.<\/li>\n<\/ul>\n

    \"\"<\/strong> <\/p>\n

    \"<\/p>\n

    <\/figure>\n
    \n

    \"\"<\/strong> <\/p>\n

      \n
    • Bank of Canada holds rate at 2.75%, but leaves door open for further rate relief <\/li>\n
    • Toronto condo glut forces more landlords to lure tenants with incentives like free rent, says Urbanation <\/li>\n
    • Canada commits funding to joint AI safety effort with the U.K.<\/li>\n<\/ul>\n

      \"\" <\/p>\n

      The family cottage has historically offered a unique blend of emotional and financial returns: a place to create memories and a promising secondary investment. But these days real estate is no longer the automatic wealth builder it once was. Rebecca Broadley, a senior wealth adviser at Richardson Wealth, outlines what you should be looking at to determine if buying a cottage will be a good investment or just an expensive luxury. <\/p>\n

      Read more <\/p>\n

      \n
      Are you worried about having enough for retirement? Do you need to adjust your portfolio? Are you starting out or making a change and wondering how to build wealth? Are you trying to make ends meet? Drop us a line at\u00a0<\/span>wealth@postmedia.com<\/span>\u00a0with your contact info and the gist of your problem and we\u2019ll find some experts to help you out while writing a Family Finance story about it (we\u2019ll keep your name out of it, of course).<\/span><\/div>\n
      \n

      McLister on mortgages<\/h2>\n

      Want to learn more about mortgages? Mortgage strategist Robert McLister\u2019s <\/p>\n

      Financial Post column <\/p>\n

      can help navigate the complex sector, from the latest trends to financing opportunities you won\u2019t want to miss. Plus check his <\/p>\n

      mortgage rate page<\/p>\n

      for Canada\u2019s lowest national mortgage rates, updated daily. <\/p>\n

      \n

      Financial Post on YouTube<\/h2>\n

      Visit the Financial Post\u2019s <\/p>\n

      YouTube channel<\/p>\n

      for interviews with Canada\u2019s leading experts in business, economics, housing, the energy sector and more. <\/p>\n

      \n

      Today\u2019s Posthaste was written by Pamela Heaven with additional reporting from Financial Post staff, The Canadian Press and Bloomberg.<\/em> <\/p>\n

      Have a story idea, pitch, embargoed report, or a suggestion for this newsletter? Email us at\u00a0<\/p>\n

      posthaste@postmedia.com<\/p>\n

      . <\/p>\n

      \n
        \n
      • If a 15% tariff is the ‘new normal,’ would that be a ‘tough pill’ for Canada?<\/li>\n
      • The hidden costs of the \u2018Buy Canadian\u2019 movement<\/li>\n<\/ul>\n

        Bookmark our website and support our journalism:<\/strong> Don\u2019t miss the business news you need to know \u2014 add\u00a0financialpost.com\u00a0to your bookmarks and sign up for our newsletters here<\/em> <\/p>\n

        <\/img>
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        Posthaste: Why Canada's job market might be too good to be true<\/a>
        \n
        2025-07-31 11:57:38<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

        Canada\u2019s job market appears to have stood up remarkably well to Donald Trump\u2019s tariff war so far, with the economy showing a surprise surge in jobs in June and the…<\/p>\n","protected":false},"author":2,"featured_media":62529,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[31],"tags":[],"class_list":["post-62528","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy"],"_links":{"self":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/62528","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/comments?post=62528"}],"version-history":[{"count":0,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/62528\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media\/62529"}],"wp:attachment":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media?parent=62528"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/categories?post=62528"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/tags?post=62528"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}