Investing.com -- Canada's labor market softened further in August, with employment declining by 66,000 jobs and the unemployment rate rising to 7.1%, according to data released Friday by Statistics Canada. The report marks the second consecutive month of job losses, adding to signs of a cooling labor market amid a period of broader economic uncertainty.
The increase in the jobless rate, above economists' expectations of 7.0%, was largely attributed to a drop in part-time work, which fell by 60,000 positions. Meanwhile, full-time employment held steady after a slight contraction in July, suggesting firms are hesitant to hire amid persistent inflation and higher borrowing costs.
Core-aged Canadians, those between 25 and 54, bore the brunt of the August losses, with employment among men falling by 58,000 jobs and 35,000 among women. This pushed their respective unemployment rates to 6.4% and 5.7%, both increasing by 0.3 percentage points month-over-month.
Industry-level data highlighted sharp job contractions in professional, scientific and technical services (-26,000), transportation and warehousing (-23,000), and manufacturing (-19,000). The construction sector was a rare bright spot, adding 17,000 jobs, its strongest gain since January and a partial rebound from losses in July.
Regionally, Ontario saw the largest employment decline, shedding 26,000 positions, followed by British Columbia (-16,000) and Alberta (-14,000). Unemployment rates in these provinces were above the national average, with Alberta recording the steepest increase, up 0.6 percentage points to 8.4%.
The national participation rate edged down 0.1 percentage points to 65.1%, indicating a slight retreat from the labor market. Broader indicators of slack also worsened, with 8.8% of employed Canadians saying they wanted to work more hours -- highlighting a rise in underemployment, particularly in provinces hit hardest by layoffs.
The labor market remains especially challenging for young people and returning students, who face some of the highest unemployment rates this summer since the 2009 financial crisis. In August, the jobless rate for returning students hit 16.9%, and even higher at 17.9% for the full summer average.
Multiple jobholding remains relatively steady, with 5.4% of Canadians holding more than one job in August. However, the reasons behind that trend underscore ongoing financial pressure -- 33.6% cited the need to pay for essential needs, while another third pointed to the desire for extra income.
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