Economic commentary provided by Alberta Central Chief Economist Charles St-Arnaud.
Bottom line
Employment surged by 83.1k in June, significantly better than expected. This is the strongest job gain since the beginning of 2025. As a result, the unemployment rate eased to 6.9%. The details show a strong increase in employment in the trade industry, reversing the job losses seen since the beginning of the year. Similarly, there was a small increase in manufacturing jobs, after four consecutive months of declines.
Wage growth for permanent workers slowed to 3.2%, its slowest since early 2022. However, we estimate that the 3-month annualized change of the seasonally-adjusted series was 4.6%, suggesting that wage growth remained robust in recent months.
Overall, today’s number shows a labour market that is much more resilient than expected. However, it remains unclear whether the strong job gains seen in June are sustainable. Nevertheless, the stronger-than-expected labour data suggests that the negative impact of the US tariffs on the Canadian economy is likely smaller than initially thought. This could be due to the fact that the effective tariff rate on Canadian exports to the US is lower than initially feared, due to the CUSMA exemption, leading to a gradual reduction in uncertainty and improvement in sentiment in recent months. This likely means that the economy was no longer deteriorating in June. However, with new tariffs on copper and a potential increase in tariffs for non-CUSMA-compliant items to 35%, the Canadian economy continues to face strong headwinds in the second half of the year.
The resilience of the labour market in June will provide some confidence to the BoC that it took the right decision to pause at the June meeting and to wait for more information. Moreover, the BoC has made it clear that inflation is its primary focus currently. Unless underlying inflationary pressures ease, it would require a significant deterioration of the economy for them to cut rates. With this in mind, next week’s CPI report will be an important input for the BoC’s decision in July. However, with the resilience in the labour market, it seems likely the central bank will choose to be patient and keep its policy rate unchanged.
Alberta saw a surge of 30.0k job losses in June, reversing the weakness in the labour market since the beginning of the year and bring the province’s unemployment rate closer to the national average. The weakness in the labour market since the beginning of the year was somewhat surprising given Alberta’s exports were much less impacted by the US tariffs than the rest of the country.
Wage growth in Alberta accelerated to 4.8% y-o-y from 1.3% y-o-y and outperformed significantly the rest of the country. The 3-month annualized change of the seasonally-adjusted series, at 11.6%, suggests a sharp rise in average wages in June. Wages in Alberta have generally underperformed relative to the rest of the country in recent years (see Why are Albertans so grumpy? It’s about falling behind economically for some explanations).
Employment increased by 83.1k in June, much higher than expected. This is the largest increase since the beginning of the year, leading to a decrease in the unemployment rate to 6.9%. The participation rate rose to 65.4% and the employment rate, the share of the population holding a job, edged higher to 60.9%. However, both the participation rate and the employment rate remain close to their lowest levels since the late 1990s.
Wage growth for permanent workers eased to 3.2% y-o-y, after 4.1% in May. However, the 3-month annualized change in seasonally-adjusted wages shows that wages grew 4.6% from 3.6%, suggesting stronger wage pressures in recent months.
The details show that the job gains were in part-time jobs (+69.5k) and full-time jobs (+13.5k). The higher employment in June was mostly in the public sector (+23.4k), the private sector (+46.6k), and self-employed (+13.1k). Over the past year, almost a third of job creation was in the public sector. Hours worked increased in June (+0.5% m-o-m), suggesting that economic activity improved this month.
On an industrial level, there were job gains in both the service sector (+73.1k) and the good-producing sector (+10.1k).
The details in the goods-producing sector show that the job gain were mainly in manufacturing (+10.5k), and construction (+7.6k). They were partly offset by decreases in agriculture (-6.0k) and utilities (-1.7k).
The increase in the service industries (+73.1k) was led by trade (+33.6k), health care (+16.7k), professional, scientific & tech (+11.9k), and culture and accommodation and food services (+8.1k). These increases were partly offset by decreases in other services (-8.5k), and transport and warehousing (-3.4k).
At a provincial level, the increase in employment was concentrated in AB (+30.0k, +1.2% m-o-m), Quebec (+23.4k, +0.5% m-o-m), Ontario (+21.2k, +0.3% m-o-m), and BC (+5.0k, +0.2% m-o-m). There were some job losses in three provinces, led by Newfoundland (-3.5k, -1.4% m-o-m), Nova Scotia (-3.4k, -0.6% m-o-m), and New Brunswick (-1.2k, -0.3% m-o-m).
The unemployment rate eased slightly at the national level but saw some slight increases in some provinces, led by Saskatchewan (+0.7pp), Quebec (+0.5pp), PEI (+0.4pp), Nova Scotia (+0.2pp), and Newfoundland (+0.2pp). BC (-0.8pp), AB (-0.6pp), Manitoba (-0.4pp), and Ontario (-0.1pp) saw a decline in the unemployment rate.
The unemployment rate is the highest in Newfoundland (+9.9%), PEI (+8.6%), Ontario (+7.8%), New Brunswick (+7.3%) and AB (+6.8%). It is the lowest in Manitoba (+5.5%), and BC (+5.6%).
Wages for permanent workers decreased nationwide. It increased most in AB (+4.8% y-o-y), New Brunswick (+4.6% y-o-y), Newfoundland (+3.9% y-o-y), and Ontario (+3.6% y-o-y). It rose at the slowest pace in PEI (+0.6% y-o-y), and Quebec (+2.0% y-o-y).
Looking at CMAs, Employment grew the most over the past year in Kamloops (+18.0% y-o-y), Red Deer (+13.2% y-o-y), Belleville (+9.5% y-o-y). However, the lowest-performing cities were Guelph (-7.4% y-o-y), Saint John (-5.2% y-o-y), and Sherbrooke (-4.5% y-o-y).
The unemployment rate was the highest in Windsor (+11.2%), Peterborough (+10.0%), Oshawa (+9.3%). While the lowest rates are in Victoria (+3.9%), Saguenay (+4.4%), Quebec (+4.5%) and Saskatoon (+4.6%).
In Alberta, employment increased by 30.0k in June, the strongest monthly gain since December, reversing the weakness seen so far this year. As a result, the unemployment rate dropped to 6.8% from 7.4%, while the participation rate rose to 68.7% from 68.7%. The employment rate, the share of the population holding a job, rose to 64.0% from 63.4%. Wage growth for permanent workers accelerated to 4.8% y-o-y. The 3m/3m annualized wage growth jumped to 11.6%, suggesting a strong increase in average wages for permanent workers in June.
The job gains in Alberta were mainly full-time (+51.3k), while part-time jobs declined (-21.3k). Employment was higher mainly in the private sector (+26.3k) and self-employed (+5.7k), while there was a marginal loss in the public sector (-2.0k).
The employment gains were mainly in the service sector (+30.6k), while the goods-producing sectors was little changed (-0.6k).
The marginal decline in the goods-producing industry was mainly due to job losses in construction (-7.8k), agriculture (-2.6k), and utilities (-1.0k), being almost fully reversed by gains in manufacturing (+6.8k) and natural resource extraction (+4.0k).
The gains in the service sector were relatively broad-based, led by finance, insurance and real estate (+8.3k), health care (+6.7k), business, building and other support services (+5.5k), trade (+4.9k), and transportation and warehousing (+4.7k. There were declines only in other services (-3.6k), public administration (-3.5k), and professional, scientific and technical (-0.7k).
On a regional basis[1], the data is published on a three-month average basis (see table below). Over the past three months, the province gained 12.5k jobs each month on average. There were increases in Calgary (+12.7k), Edmonton (+6.6k), Red Deer (+1.5k), and Wood Buffalo-Cold Lake (+0.9k), while there were job losses in Western Alberta (-1.9k), Camrose-Drumheller (-1.4K), and Lethbridge-Medicine Hat (-0.8k).
The unemployment rate for the province eased to 7.1% on average over the past three months. The unemployment rate decreased in all regions, except in Edmonton (+0.4pp) and Wood Buffalo-Cold Lake (+0.1pp). The biggest declines were in Lethbridge-Medicine Hat (-0.4pp), Calgary (-0.3pp), and Red Deer (-0.3pp).
The unemployment rate is the highest in Edmonton (7.6%), Calgary (7.4%), Western Alberta (6.9%), and Wood Buffalo-Cold Lake (6.7%). It is the lowest in Red Deer (5.4%), Camrose-Drumheller (5.6%), and Lethbridge-Medicine Hat (6.6%).
The employment rate for Alberta rose to 63.7% over the past three months. The employment rate improved in Red Deer (+0.8pp), Wood Buffalo-Cold Lake (+0.7pp), Calgary (+0.5pp), and Edmonton (+0.3pp). It decreased in Camrose-Drumheller (-0.8pp), Western Alberta (-0.7pp), and Lethbridge-Medicine Hat (-0.3pp).
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Independent Opinion
The views and opinions expressed in this publication are solely and independently those of the author and do not necessarily reflect the views and opinions of any organization or person in any way affiliated with the author including, without limitation, any current or past employers of the author. While reasonable effort was taken to ensure the information and analysis in this publication is accurate, it has been prepared solely for general informational purposes. There are no warranties or representations being provided with respect to the accuracy and completeness of the content in this publication. Nothing in this publication should be construed as providing professional advice on the matters discussed. The author does not assume any liability arising from any form of reliance on this publication.