Canada’s job market continued to expand in January, adding 76,000 jobs (+0.4%), according to the latest Statistics Canada report.¹ The employment rate rose by 0.1 percentage points to 61.1%, marking the third consecutive month of growth. The unemployment rate declined slightly to 6.6%, down 0.1 percentage points from December.

Employment gains in January follow increases in both December (+91,000) and November (+44,000), bringing total job growth over three months to 215,000. While full-time employment rose by 147,000 (+0.9%), part-time jobs also increased by 64,000 (+1.7%).

The employment rate increased to 61.1%, reversing a previous downward trend where population growth outpaced job creation. The unemployment rate declined for the second month, down from its recent peak of 6.9% in November 2024.

Demographic Breakdown

• Youth (15-24): +31,000 jobs (+1.1%)
• Core-aged women (25-54): +36,000 jobs (+0.5%)
• Core-aged men (25-54): +28,000 jobs (+0.4%)
• Men 55 and older: -20,000 jobs (-0.8%)
• Women 55 and older: Little change

Private sector employment saw 57,000 new jobs (+0.4%), continuing December’s growth trend. Public sector employment remained stable, while self-employment increased by 27,000 (+1.0%).

 Industry Breakdown

January’s job gains were led by manufacturing (+33,000 jobs, +1.8%), continuing its growth from December. Professional, scientific, and technical services added 22,000 jobs (+1.1%), reflecting strong demand for skilled workers. Construction (+19,000 jobs, +1.2%) and hospitality (+15,000 jobs, +1.3%) also saw notable increases, while transportation and warehousing (+13,000 jobs, +1.2%) benefitted from steady logistics activity. The only major decline came from personal and repair services (-14,000 jobs, -1.8%), signaling reduced demand in non-essential services.

Ontario led with 39,000 new jobs (+0.5%), followed by British Columbia (+23,000, +0.8%) and New Brunswick (+2,900, +0.7%). In New Brunswick, the unemployment rate fell 1.3 percentage points to 6.4%, driven by fewer people in the labor force. Unemployment held steady in Ontario (7.6%) and British Columbia (6.0%), despite job growth. Other provinces saw minimal change, keeping January’s employment gains largely concentrated in key economic hubs.

Feb 7, 2025: Featured Insight & Analysis on the Jobs Market

Will Tariffs Affect Candidate Searches in Canada?

While Canada may have won a reprieve from U.S. tariffs, the threat still looms, creating economic uncertainty.

“It’s universally accepted that tariffs would hurt our economy,” says Henry Goldbeck, President of Goldbeck Recruiting.² Goldbeck suggests that this uncertainty may cause companies to hesitate when it comes to expansion. However, he remains confident that candidate searches will persist.

“It will reduce new hires,” Goldbeck explains. “But if you need people, you need people. If you’re an established company and your sales manager or top accountant retires, these people will need to be replaced.”

Canada’s Response to Tariff Threats

Goldbeck acknowledges that while the ideal Canadian response strategy is unclear, it is essential to take a firm stance.

“We must communicate our importance to the U.S. economy and be tough at the same time,” he advises.

Goldbeck is particularly concerned about the long-term effects of U.S. tariffs, especially on foreign investment.

“Is Volkswagen going to invest in a plant in Ontario if the U.S. isn’t going to be an open market?” he asks.

In his view, Canada may need to consider adopting more protectionist policies, akin to the pre-NAFTA era, if access to the U.S. market becomes limited.

Challenges in Engineering Recruitment

In the short term, Goldbeck notes a cooling demand for project managers and site supervisors in the construction sector. However, he predicts an emerging engineering talent crunch, particularly in construction and manufacturing.

Intermediate and senior engineers in these industries are aging out, creating a skills gap. According to Goldbeck, many companies have not adequately prepared younger employees to step into these roles.

“It’s hard for smaller companies to attract intermediate and senior engineers with niche experience,” he says. “In the past month, we’ve seen five or six candidates decline offers because their current employers made very strong counteroffers.”