Labour Force Survey November 2024: Canadian unemployment rate surpasses expectations and hits 6.8%.

Even with a net gain of 50,000 jobs, employment growth is still playing catch up and remains a fraction of the growth in Canada’s labour force, which was almost three times more. November’s unemployment rate climbed to 6.8%—a jump from last month’s 6.5%—marking a worse-than-expected outcome and edging closer to an eight-year high, outside of the pandemic years.

There were some positive signs, though: the employment and participation rates showed a slight recovery compared to previous months. But with joblessness on the rise, the big question remains: will these numbers nudge the central bank to consider a deeper cut to borrowing costs than usual?

Marwa Abdou, Senior Research Director, Canadian Chamber of Commerce

KEY TAKEAWAYS

Employment gains and losses were spread across several services industries. Gains were seen in wholesale and retail trade (+39K; +1.3%), construction (+18K; +1.2%), professional, scientific and technical services (+17K; +0.9%), educational services (+15K; +1.0%), and accommodation and food services (+15K; +1.3%). There were also declines in other industries, such as manufacturing (-29K; -1.6%), transportation and warehousing (-19K; -1.7%) and natural resources (-6.3K; -1.8%).
Canada’s labour force participation rate rose to 65.6%, up 0.2 percentage points from October, marking its first increase after four months of decline.
Similarly, the employment rate held steady at 60.6%, halting a downward trend that began in May. These changes indicate a modest recovery in labour market engagement, as more individuals entered the workforce and employment levels stabilized.
The unemployment rate increased to 6.8%, up 0.3 percentage points from October’s 6.5%, exceeding analysts’ expectations of 6.6%. Unemployment rose sharply in most of Canada’s large census metropolitan areas (CMAs), led by Calgary (+2.0 ppts), Edmonton (+1.9 ppts) and Québec (+1.8 ppts).
November’s release brings the total number of unemployed persons in Canada to 1.5 million – a figure that’s increased by 22% since last year.
Even with a larger than expected increase in employment of 50K (compared with the market’s anticipated 25K), Canadian employment is still not keeping up. Compared to a year prior, the number of employees in the public sector grew by 127K (+2.9%) while private sector employment rose by 173K at a slower pace (+1.3%; +173,000) in November highlighting a slower pace of job growth relative to labour force growth.
Total hours worked remained nearly unchanged (-0.2%) in November, and 1.9% on a year-over-year basis. Average hourly wages rose 4.1% on a year-over-year basis, following an increase of 4.9% in August.
Regionally, provincial employment increased in Alberta (+24K; +1.0%), Quebec (+22K; +0.5%), Manitoba (+6.6K; +0.9%) and Prince Edward Island (+2.7K; +2.9%) while seeing little change in the other provinces.