Canada's unemployment rate hits highest point since 2017

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Key Takeaways

• Canada’s unemployment rate rose to 6.9% in April 2025, the highest since January 2017 excluding the pandemic.
• Ontario’s unemployment soared to 7.8% in April, mainly due to 31,000 manufacturing job losses and new U.S. tariffs.
• Hourly wage growth slowed to 3.4% while sectors like public administration and real estate added jobs, offset by big losses elsewhere.

Canada’s unemployment rate rose to 6.9% in April 2025, matching its highest point since early 2017 except for the COVID-19 pandemic period, according to the latest data. This increase, up from 6.7% in March, is causing concern among workers, families, and businesses across the country. Even though the Canadian economy added 7,400 new jobs, the number of people out of work grew faster, signaling deeper trouble in the job market.

The most affected areas are in the manufacturing sector, with Ontario 🇨🇦 standing out as a region facing bigger problems than most. This article takes a detailed look at what the numbers mean, why this is happening, and how different groups are being affected by these changes.

What Happened to Canada’s Unemployment Rate?

Canada’s unemployment rate is now at 6.9%. This means almost seven out of every 100 people who want a job and are looking for work cannot find one. This is the biggest rise in the unemployment rate in years, except for the special case of the pandemic.

In April 2025, the economy gained 7,400 jobs, which would seem like good news.
Despite the new jobs, the number of unemployed people went up by 39,000 in just one month.
Compared with the same month a year ago, there are now 189,000 more people out of work in Canada 🇨🇦.

This is a sharp change for the Canadian labor market, which had shown more strength earlier in the year.

Hit Hard: Manufacturing Sector and the Ontario 🇨🇦 Story

The manufacturing sector is facing its own storm. In April alone, manufacturing lost 31,000 jobs. That’s the sharpest monthly loss since November 2024. Factories, producers, and suppliers have all been pulled into this downturn.

Most of this decline links back to growing trade tensions. New U.S. tariffs on Canadian 🇨🇦 goods are making it harder for companies in this sector to keep up business as usual. These tariffs work like a “tax” on exports, making goods made in Canada 🇨🇦 more expensive for American 🇺🇸 buyers. As a result, many factories in Ontario 🇨🇦 and other manufacturing-heavy provinces have slowed production or let workers go.

Ontario 🇨🇦, home to a large number of manufacturers, is feeling the pressure more than any other province:

Unemployment in Ontario 🇨🇦 reached 7.8% in April, rising by 0.3 percentage points within a single month.
This jump in Ontario 🇨🇦 is one of the biggest reasons the national rate is up.

Because Ontario 🇨🇦 is often called the “engine” of Canada’s economy, troubles in this province have the power to affect workers and families everywhere.

What’s Behind the Unemployment Rise?

Several forces are causing Canada’s unemployment rate to climb:

Population Is Growing Faster Than Jobs
- More people are entering the workforce, hoping to find jobs.
- The “participation rate” (the share of people who either have a job or want to find one) increased by 0.1%, reaching 65.3%.
- While that signals confidence, the economy is not creating jobs fast enough for all these new job seekers.
More Unemployed Are Staying Unemployed
- In April, 61% of the people who did not have a job in March were still looking and had not found work a month later. A year ago, this figure was only 57.3%.
- This means that people are waiting longer to find jobs and suggests that it is getting tougher to secure work.
Trade Tensions Fuel Job Losses
- New U.S. tariffs on Canadian goods have created new problems for businesses.
- Tariffs make it more expensive for Americans to buy Canadian products, which can lead to fewer orders and less need for workers.
Layoffs and Fewer Hires
- Wholesale and retail trades lost 27,000 jobs combined, mainly because these are industries tied closely to cross-border trade.
- As factories and stores face rising costs and fewer sales, they reduce staff.

Looking Closer: Which Sectors Gained Jobs?

While manufacturing, wholesale, and retail trade shed many jobs, some sectors actually grew in April.

Public Administration Added 37,000 Jobs
- Most of these jobs were likely temporary, linked to the federal election process.
- This uptick kept the overall job picture from looking even worse.
Real Estate, Finance, Insurance, Rental and Leasing Sectors Added 24,000 Jobs
- These “white-collar” industries are still hiring, even as other fields are shrinking.
Public Sector Grew by 23,000 Jobs
- This includes all jobs paid for by the government, such as health care, education, and public utilities.
- The private sector, where most Canadians work, saw little change.

These gains were not large enough to balance out the heavy losses in manufacturing and trade, but they did provide some good news.

The Broader Economic Picture

Canada 🇨🇦 is not the only country feeling economic uncertainty. But economists point out that the current problems can be traced clearly to trade issues with the United States 🇺🇸. U.S. tariffs mean Canadian products are harder to sell, hurting exporters, factory workers, truckers, and the towns that depend on them.

Experts now expect the Bank of Canada to lower the country’s main interest rate by 0.25% at its next meeting on June 4.
The move is supposed to make borrowing cheaper, which could help businesses invest and hire more workers.
Even so, most believe Canada’s unemployment rate could rise further through the rest of 2025.

Household spending is already low, with many families choosing to save instead of buying new items or making big purchases. At the same time, businesses are waiting to see if the tariffs will last or if things will get better soon. All this adds to the sense of uncertainty.

Impact on Wages

Hourly wages did grow by 3.4% in April compared to a year ago, but this was a bit slower than the 3.6% annual increase seen in March.

This softening wage growth is another sign that the labor market is cooling.
Workers who switch jobs or look for raises may find it harder to get the jump in pay they could expect last year.

Who Is Most Affected by These Changes?

Workers and Job Seekers

For anyone looking for work in the manufacturing sector, especially in Ontario 🇨🇦, the job search is likely to take longer. The same is true for people in retail and wholesale trades, who are seeing fewer job ads and more competition for every opening.

The number of people looking but not finding work keeps rising.
People who lose jobs in manufacturing may find it difficult to move into other sectors, especially if their skills are specialized or if they are older workers.

Employers and Businesses

Companies, particularly in the manufacturing and trade-linked fields, must decide whether to hire new workers. Many are holding off, afraid that trade problems or weak sales will hurt them down the line.

Some are cutting hours or moving to shorter work weeks.
Others are choosing not to replace staff who quit or retire.

Families in Key Regions

Families living in Ontario 🇨🇦 and other provinces where factories play a big role may notice the impact more.

As one plant or business lays off workers, other companies in the area may see sales drop as people have less to spend.
Communities that depend on steady paychecks from manufacturing jobs feel the stress most.

Why Ontario 🇨🇦 Matters to the National Story

Ontario 🇨🇦 is not just the most populous province in Canada 🇨🇦; it is a key producer of cars, machinery, and high-value exports. When its manufacturing sector takes a hit, the effect ripples out across the country.

Ontario 🇨🇦’s unemployment rate jumped to 7.8% in April, well above the Canadian average.
Layoffs in Ontario 🇨🇦 can send ripples to other industries, including trucking, logistics, food service, and even housing.

As reported by VisaVerge.com, economic troubles in Ontario 🇨🇦 have far-reaching effects, sometimes shaping national policy and budget decisions. When the unemployment rate in Ontario 🇨🇦 grows, leaders in Ottawa must act, whether by adjusting support programs or discussing trade policies.

Responses and Possible Policy Changes

With the job market under pressure, many people are watching to see what steps the government will take. Changes may include:

New support programs for laid-off workers, such as retraining or help with job searches.
Incentives for businesses to hire, especially in struggling industries.
Possible changes in immigration policy, such as tweaking work permit rules or attracting skilled workers to sectors with job shortages.

Leaders are also keeping an eye on talks with U.S. officials to see if there is any way to ease the tariffs that have hit Canadian 🇨🇦 exports so hard.

Looking Ahead: What Does This Mean for Immigrants and Newcomers?

For people hoping to move to Canada 🇨🇦, the changes can mean both challenges and opportunities. Some industries, like manufacturing and retail, are slower for hiring right now, especially in Ontario 🇨🇦. However, fields like public administration, real estate, and finance are still adding jobs. Immigrants with skills in these sectors may find better chances.

Because Canada 🇨🇦 uses immigration programs that often match newcomers to labor market needs, shifts like these can change which types of workers are welcomed most.

Those with skills in health care, technology, or finance may still find strong demand.
People trained in manufacturing may want to research the current job climate and consider retraining, if possible.

For more information about work permits, labor market needs, and skills matching in Canada 🇨🇦, check the official Government of Canada jobs and employment page.

The Big Picture: What to Watch in 2025

The rest of 2025 could be a bumpy ride for Canada 🇨🇦 as the country deals with shifting trade patterns, a soft job market, and a potential interest rate cut.

If the Bank of Canada lowers interest rates, borrowing and investment may pick up.
If trade talks with the United States 🇺🇸 do not improve, more job losses could follow, especially in exporting industries.
Wages may rise more slowly if businesses feel unsure about the future.

Key Points to Remember

Canada’s unemployment rate is now at 6.9%, the highest since January 2017 if you ignore the pandemic.
Manufacturing lost 31,000 jobs in April, with Ontario 🇨🇦 hit hardest.
The number of unemployed people is growing faster than the number of jobs created.
Some sectors, like public administration and real estate, added jobs, but not enough to balance the losses elsewhere.
Trade tensions, especially tariffs from the United States 🇺🇸, are a key reason for trouble in the manufacturing sector.
Economists expect the Bank of Canada to cut interest rates soon to help boost the economy.
Job seekers, especially in the manufacturing sector and Ontario 🇨🇦, face a tougher search.
Immigrants and new workers with skills in growing sectors may still find good prospects.

Next Steps for Readers

If you are worried about job security or thinking about moving to Canada 🇨🇦 for work, keep a close eye on the latest labor market data and industry news. Consider seeking skills in sectors that continue to grow. Employers should watch for government announcements on support and possible policy changes in hiring and training.

To keep up with Canada’s 🇨🇦 employment trends, visit the StatCan monthly unemployment data for direct updates from the government. For news about changing immigration policies and labor market needs, VisaVerge.com provides in-depth analysis to help you make informed decisions about work, hiring, or moving to Canada 🇨🇦.

In this shifting environment, understanding the labor market’s ups and downs is key for everyone—from job seekers in Ontario 🇨🇦’s manufacturing sector, to business owners, to newcomers planning a future in Canada 🇨🇦. By staying informed and prepared, all can make better choices as the Canadian economy continues to adapt in the months ahead.

Learn Today

Unemployment Rate → The percentage of people in the labor force who are actively seeking work but unable to find a job.
Manufacturing Sector → Industry segment involved in producing goods and materials in factories, often crucial to regional economies like Ontario’s.
Tariffs → Government-imposed taxes on imports or exports, affecting prices and international trade competitiveness, especially between Canada and the U.S.
Participation Rate → The share of people of working age who are either employed or actively looking for work.
Public Administration → Government-run sector employing workers in various official, regulatory, and administrative roles, often providing job stability.

This Article in a Nutshell

Canada’s unemployment rate hit 6.9% in April 2025, its highest since early 2017 outside the pandemic. Manufacturing, particularly Ontario, saw big job losses due to U.S. tariffs. While sectors like public administration added positions, job seekers face a tougher market, and wage growth slowed, deepening economic concern.
— By VisaVerge.com

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