The economy of Canada lost 84,000 jobs in February, and the unemployment rate has increased to 6.7 per cent, whereas Statistics Canada said on Friday, a blow to the labour market and one of the worst monthly job losses in years, which was not during the pandemic.

A decrease in full-time jobs and in the private sector employment greatly contributed to the fall in employment, which was nullifying a temporary rise recorded previously in the fall.

The key areas where employment was lost were in the goods and services-producing industries, where 18,000 lost their jobs in the wholesale and retail trade, 12,000 lost their jobs in construction, and 9,200 lost their jobs in manufacturing. The drop adversely affected men between the ages of 25 and 54, as well as young people between the ages of 15 and 24.

Some of the indicators remained relatively the same as they were in the same period last year, such as the rate of unemployment (which remained at 6.6 per cent in February 2025), the rate of employment and people working full-time or part-time.

The rate of participation (or the number of individuals who had a job or were seeking one) declined by 0.1 per cent to 64.9 per cent in February. The increase in average hourly wages recorded was 3.9 per cent, or $1.42 an hour, which amounted to $37.56 an hour against the same year.

Katherine Judge, executive director and senior economist at CIBC Capital Markets, said the labour market made an ominous shift in February, especially in the case of the loss of full-time, privately-based jobs.

The decline in employment and the increase in the unemployment rate were contrary to the expectations of the analysts that the labour market would have attracted 10,000 jobs and the rate of unemployment would have increased at a lower figure than it did, she wrote.

“It is obviously a very alarming report to the [Bank of Canada] indicating that labour market slack has risen and activity has been frozen in the face of trade uncertainty,” said Judge.

The last significant economic data release that the central bank can consider is the inflation figures due on Monday, as it prepares to have its next interest rate decision on Wednesday. By Friday afternoon, most economists were forecasting that the Bank would retain its rates at their current levels.

Deeply pathetic report, according to the economist

Statistics Canada reported that the rate of unemployment increased or remained steady in nine out of 13 provinces and territories in the last month.

The unemployment rate of the youth aged between 15 and 24 years increased to 14.1 per cent, another hit to a generation that has continued to experience a high rate of joblessness over the past two years. The statistics on racialised young people were significantly higher than those of the non-racialised, non-Indigenous young people, the data agency said.

“The calculation that the unemployment rate has been nearly the same as it was a year ago does soften my apprehension of this outcome to some degree,” said Douglas Porter, chief economist at the Bank of Montreal, in an interview with CBC News.

“Nevertheless, I believe the overall message here is that it was quite weak at the beginning of the year. We have noticed virtually no employment gain at all in the past 12 months. And that does not augur well for the economy. “

“The fact that the report was exceptionally weak should kill any discussion on increasing interest rates, which had been being marketed in the second half of the year,” said Porter.

“In fact, I believe that the bank should also be contemplating the probability of doing rate cuts in case this sort of weakness in the economy persists in the coming months,” he said.

“In addition to the fact that we are about to load consumers with the blow to their disposable income caused by a rise in oil prices, there is the uncertainty of the USMCA, not to mention that we are not adding any jobs to the economy. I do not expect the Bank of Canada to hike in such an environment.”